Business dispute in international business

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Netherlands Enterprise Agency RVO
Netherlands Enterprise Agency RVO

Do you have a difference of opinion (dispute) with a foreign business partner, customer, or supplier? And cannot come to an agreement together? There are ways to resolve the dispute without having to go to court.

Good preparation can make all the difference

Therefore, come to clear agreements about:

Record these agreements legally in an (international) contract, quotation, or general terms and conditions. Read more about legal matters when doing business abroad.

Find out what caused the dispute

You should resolve a business dispute with your customer, supplier, or business partner. For example, try to find out the reason why an invoice is not paid. Was the delivery late, are there quality concerns, or was the contract misinterpreted? You may be able to determine the cause of the conflict and resolve it quite easily.

Take cultural differences into account

Learn about the cultural differences between the Netherlands and the country you do business with. Perhaps a cultural difference is the cause, leading to a misunderstanding. The country information provided by the Netherlands Enterprise Agency (in Dutch) and the Netherlands Chamber of Commerce KVK (in Dutch) offers an overview of the most important dos and don'ts per country.

Request help from the embassy or consulate

Cannot seem to solve the problem together? Then the Dutch embassy or consulate can help with a solution. They know which authorities you can call on abroad. The Dutch embassy and consulate have an advisory role. So they have no means of power to enforce regulations.

Check whether arbitration or mediation is an option for you

Arbitration is a way to resolve a conflict without going to court. Experts then decide on the conflict. Advantages of arbitration include:

  • it is cheaper
  • it is less official
  • it is usually faster
  • arbitration bodies usually have more specialist knowledge than judges
  • you choose which arbitration body makes the decision
  • you choose which language and which law to use
  • the award is often easier to enforce

This procedure is usually faster than legal proceedings. The experts are usually more specialised than judges. You designate an arbitral tribunal in an arbitration clause in your contract.

When you choose mediation, an independent mediator helps to resolve the dispute. You choose this option together with the other party in the conflict. Even when a case has already been brought to court, you can still choose mediation.

Arbitration through special organisations

In many countries, organisations such as the International Chamber of Commerce (ICC) offer arbitration. There are also specialised organisations that do so. Countries often have their own arbitration laws. Therefore, familiarise yourself with the rules of the country you are doing business with.

Arbitration clause in a contract

You can put an arbitration clause in a contract. This states that in the event of a dispute, you and your business partner will go to an arbitrator and not to court. You agree on this in advance. You can then also appoint a national or international arbitration organisation. This will then rule in the event of a dispute.

Do you use the International Chamber of Commerce's standard model contract? Then it is a good idea to name the ICC as the arbitration body in it.

Check if you can get your money back

When products or services are not delivered as agreed, you probably want your money back. A special European procedure makes it easier to seize a bank account in another member state. This is called a European Account Preservation Order. This often gets your money back faster than through the other procedures.

You can also have your dispute resolved in court. You start such legal proceedings by engaging a lawyer who is specialised in international law. In the contract with your customer, supplier, or business partner you have stated whether Dutch or foreign law applies.

The process can sometimes take a long time. In addition, legal proceedings are not cheap. Should you have a conflict with a supplier in the European Union, read about your options here.

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Questions relating to this article?

Please contact the Netherlands Enterprise Agency, RVO