International business law: contracts, courts and compliance

International business law is not one body of rules. It is the combination of your contract, the law the parties chose, the court or tribunal they agreed on, and the mandatory rules of every country the transaction touches. For a business trading from or into the Netherlands, four instruments decide most questions: the Rome I Regulation on the law applicable to contracts, the Brussels I bis Regulation on jurisdiction and enforcement within the EU, the Vienna Sales Convention (CISG) for the sale of goods, and the New York Convention for the enforcement of arbitral awards. The main exception is the set of mandatory rules, such as sanctions, export control and data protection, that apply whatever the contract says.

Which law governs an international contract?

Within the EU the answer follows from the Rome I Regulation. Dutch courts apply it to every contract concluded from 17 December 2009 onwards, whether or not the chosen law is that of a member state.

The starting point is freedom of choice. The parties may designate the law of any country, and the choice may be express or clearly demonstrated by the terms of the contract. A clause that simply says Dutch law applies is effective even if neither party is Dutch.

What if the contract says nothing about governing law?

Then the regulation assigns a law by contract type. A contract for the sale of goods is governed by the law of the country where the seller has its habitual residence. A contract for services is governed by the law of the service provider, a distribution contract by the law of the distributor, and a contract relating to immovable property by the law of the country where the property is situated.

Only where the contract is manifestly more closely connected with another country does that other law take over. A Dutch supplier who never addresses governing law will therefore usually find Dutch law applying; a Dutch buyer will usually find foreign law applying.

Where does the freedom of choice stop?

Two limits apply. First, consumer contracts and individual employment contracts remain subject to the protective rules the consumer or employee would enjoy under the law of their own country, whatever the contract says. Second, overriding mandatory provisions of the court seised, and in some cases of the country of performance, apply regardless of the chosen law.

Commercial agency is the clearest example. The Court of Justice ruled in Ingmar (C-381/98, 9 November 2000) that the protection the EU agency directive gives an agent working in the EU, including the payment on termination, cannot be avoided by choosing the law of a non-EU country. In the Dutch Civil Code that payment is the goodwill indemnity (klantenvergoeding). Our overview of the agency agreement under Dutch law sets out those mandatory elements.

Does the governing law clause also cover claims outside the contract?

Not automatically. Non-contractual claims follow a separate instrument, the Rome II Regulation. Under it, the applicable law is in principle that of the country where the damage occurs, with special rules for product liability, unfair competition, infringement of intellectual property rights and environmental damage.

A well drafted clause therefore states that it extends to non-contractual claims arising out of or in connection with the contract.

Which court decides, and can you enforce the judgment?

Between EU member states, the Brussels I bis Regulation decides which court has jurisdiction and makes the judgment enforceable across the EU. Outside the EU, enforcement is far less certain and needs to be planned before you sign.

The general rule is that a defendant is sued in the member state where it is domiciled. For contractual claims there is an alternative: the place of performance of the obligation. For the sale of goods that is the place of delivery, and for services the place where the services were provided. Tort claims can also be brought where the harmful event occurred.

A written choice of court agreement prevails over these rules and is in principle exclusive. The chosen court decides on its own jurisdiction, and any other court seised must stay its proceedings.

How does enforcement work within the EU?

A judgment given in one member state is enforceable in the others without any declaration of enforceability (exequatur). The creditor goes straight to enforcement on production of the judgment and a certificate. The debtor may resist only on limited grounds, such as a manifest breach of public policy or a defect in the service of the document that started the proceedings.

Two EU procedures avoid an ordinary national procedure entirely: the European Order for Payment for uncontested cross border claims, and the European Small Claims Procedure for low value cases. Our article on small claims in the Netherlands explains when the latter is worth using.

What about judgments from outside the EU?

The Netherlands has no general treaty on the recognition of judgments with most non-EU states. A foreign judgment is in principle not enforceable here without fresh proceedings.

Dutch courts will, however, recognise a foreign judgment that meets the conditions developed in case law: jurisdiction on internationally acceptable grounds, a proper procedure, no conflict with public policy and no incompatible Dutch decision.

Two conventions narrow the gap. The Hague Choice of Court Convention obliges the courts of contracting states to respect an exclusive choice of court clause and to enforce the resulting judgment. The Hague Judgments Convention of 2019, in force for the European Union and therefore for the Netherlands since 1 September 2023, gives a broader basis for recognition and enforcement between the states that have joined it. Check which of the two applies, and whether the other party’s country has joined at all, before you draft the clause rather than after judgment.

Does the Vienna Sales Convention apply to your sale of goods?

Usually yes, unless you exclude it. The United Nations Convention on Contracts for the International Sale of Goods has been part of Dutch law since 1992. It applies automatically to sales of goods between parties whose places of business are in different contracting states, and also where the rules of private international law lead to the law of a contracting state.

Choosing Dutch law therefore brings the convention with it, because the convention is part of Dutch law for international sales. Excluding it takes an express clause.

Should you exclude the convention?

That is a commercial decision. Article 6 of the convention allows the parties to exclude it, but it offers a neutral regime with a large body of international case law that neither party has to learn from scratch.

It does differ from Dutch domestic law on points that matter:

• It has no requirement of a written contract.
• It treats a fundamental breach as the threshold for avoiding the contract.
• The buyer must examine the goods within as short a period as is practicable and give notice of a lack of conformity within a reasonable time, with an outer limit of two years from handover.

Domestic Dutch sales law uses the different standard of complaint within a reasonable time. The fixed two month period applies only to consumer sales and not to commercial transactions.

Whose general terms and conditions apply?

Dutch law and the convention pull in different directions here. Under the Dutch Civil Code, a reply that refers to different general terms and conditions than those in the offer does not bring the second set into force unless the first set is expressly rejected. That gives the first set the advantage.

The convention is generally applied as a “last shot” system, in which the terms attached to the final communication prevail. In both systems the terms must have been made available before or at the time of contracting. A foreign counterparty can more easily argue that website terms it never received do not bind it, so attach your terms to the offer, in the contract language.

Should you choose arbitration or the courts?

For contracts with counterparties outside the EU, arbitration is usually the more enforceable option. The New York Convention obliges the courts of over one hundred and seventy states to recognise both the arbitration agreement and the award, with only narrow grounds for refusal.

Within the EU, an ordinary court judgment already circulates freely, so there the balance is different.

Is the Netherlands a good place for arbitration?

The Netherlands offers a well developed seat. Dutch arbitration law is set out in the fourth book of the Code of Civil Procedure and was modernised with effect from 2015. The Netherlands Arbitration Institute (NAI) administers proceedings under its own rules, and The Hague hosts the Permanent Court of Arbitration for disputes involving states.

An award rendered in the Netherlands can be enforced after leave from the preliminary relief judge. It can be set aside only on the grounds listed in the statute, such as the absence of a valid arbitration agreement, a tribunal constituted in breach of the rules, a tribunal that exceeded its mandate, an award without reasons or a conflict with public policy.

What does the Netherlands Commercial Court offer?

The Netherlands Commercial Court (NCC) is a court option designed for international commerce. It is a chamber of the Amsterdam district court, with an appeal chamber at the Amsterdam court of appeal. It hears international commercial disputes in English if the parties have expressly agreed to this.

The NCC applies ordinary Dutch procedural law, and its judgment circulates as a Dutch judgment under the enforcement instruments described above. Its court fees are substantially higher than those of the ordinary courts. The comparison between the routes is set out in our article on international dispute resolution.

Which trade compliance rules apply regardless of the contract?

Customs, export control and sanctions rules apply whatever the parties agree. A commercial agreement can be perfectly drafted and still be unlawful to perform.

Customs and dual use goods

Goods leaving or entering the European Union are subject to the Union Customs Code. The classification, origin and customs value of the goods determine the duty and the documents you need.

Items with a possible military application fall under the EU dual use regulation and require an export authorisation. In the Netherlands the customs administration (Douane) issues it on behalf of the responsible minister. The list includes certain encryption software, sensors and machine tools.

Why are sanctions the sharper risk?

EU sanctions regulations apply directly in the Netherlands and bind every Dutch company and every EU national, wherever they are. Breach is enforced through the Sanctions Act 1977 (Sanctiewet 1977) and is an economic offence. That means criminal rather than administrative liability, with investigation by the Fiscal Intelligence and Investigation Service (FIOD).

The obligations go beyond avoiding listed parties. They extend to the ownership and control test, under which an entity is caught where a listed person holds fifty per cent or more of it or otherwise controls it, and to the prohibition on circumvention. The twenty five per cent figure that circulates in this context belongs to the ultimate beneficial owner (UBO) register. It is a different threshold for a different purpose.

What about sustainability due diligence?

The Corporate Sustainability Due Diligence Directive (CSDDD) was substantially amended in 2026 by the Omnibus I package. The harmonised EU civil liability regime was removed, the ceiling for penalties is three per cent of net worldwide turnover, member states must transpose the directive by 26 July 2028 and companies must comply from 26 July 2029. After the amendment it covers only very large groups.

Until 2029 the directive creates no direct obligations for Dutch companies, but sustainability clauses that larger customers impose in their contracts are enforceable now.

How do you protect intellectual property abroad?

By registering in each market that matters, because intellectual property is territorial.

A Benelux trade mark covers the Netherlands, Belgium and Luxembourg only. An EU trade mark covers the whole internal market, but one earlier right anywhere in the EU can block it. Outside the EU you need national filings or an international registration through the World Intellectual Property Organization (WIPO).

Allocate ownership of what a project creates expressly, because a clause that works under Dutch law may transfer nothing abroad. Unregistered know how is protected as a trade secret only if you took reasonable steps to keep it secret, such as confidentiality agreements and access restrictions. Our guide to intellectual property law in the Netherlands sets out the rights and the registration routes.

How do you enter a foreign market: branch, subsidiary, agent or distributor?

Each route brings its own registration, liability and termination rules.

Branch or subsidiary?

A Dutch private limited company (BV) trading abroad without an establishment keeps its Dutch corporate law, but may acquire tax and employment obligations elsewhere. A branch has to be registered locally. A subsidiary is a separate legal person with its own governance and its own liability.

Foreign businesses entering the Netherlands register a branch or a subsidiary with the Netherlands Chamber of Commerce (KVK). A Dutch subsidiary, such as a BV, must also register its ultimate beneficial owners in the Dutch UBO register. A foreign company that only has a branch here reports its UBOs in the register of its home country, not in the Dutch one.

Agent or distributor?

The choice between an agent and a distributor has consequences that cannot be drafted away. A commercial agent negotiates in the name of the principal and enjoys the mandatory protection of the Dutch Civil Code. That includes notice periods that increase with the length of the relationship, and a goodwill indemnity on termination where the agent has brought new customers and the principal continues to benefit.

A distributor buys and resells in its own name and has no statutory regime. Dutch case law does, however, require a reasonable notice period when a long standing distribution relationship is ended. What is reasonable depends on the duration, the distributor’s dependence and the investments it made at the supplier’s request. Termination without that notice can lead to damages, usually measured by the profit the distributor would have made during the notice period it should have received.

Does competition law limit these agreements?

Yes. Article 101 of the Treaty on the Functioning of the European Union and the Dutch Competition Act (Mededingingswet) prohibit restrictive agreements. The block exemption for vertical agreements gives a safe harbour only within its conditions.

Resale price maintenance and absolute territorial protection remain hard core restrictions. A clause of that kind is void and can trigger an investigation by the Authority for Consumers and Markets (ACM).

What does data protection add to an international operation?

Duties that a contract alone cannot shift. Any international operation moves personal data, and the General Data Protection Regulation (GDPR) follows it.

Transfers to countries outside the European Economic Area require an adequacy decision, standard contractual clauses supported by a transfer impact assessment, or one of the derogations. You cannot shift that responsibility to the recipient by contract. Under the accountability principle, the documentation has to exist before the Dutch Data Protection Authority (Autoriteit Persoonsgegevens) asks for it, not after.

What should you check as a Dutch company contracting abroad?

Check enforcement first: a choice of court in a state where the other party holds nothing is worth less than an arbitration clause under the New York Convention that reaches its bank accounts.

• Does the contract name the governing law, and does the clause also cover non-contractual claims under Rome II?
• Can a judgment or award be enforced in the country where the other party holds its assets?
• Have you decided expressly whether the Vienna Sales Convention applies, and are your general terms attached to the offer in the contract language?
• Have you screened the counterparty and the goods against EU sanctions lists and the dual use regulation before signing, not before shipping?
• Are your trade marks registered in the markets that matter, and are confidentiality agreements signed before the first technical meeting?
• Has a tax adviser reviewed the structure at the same time as the legal choices?

What should you check as a foreign company entering the Netherlands?

Dutch registration and termination rules apply as soon as you set up here or appoint a Dutch intermediary. Most of them cannot be excluded by contract.

• Register your branch or subsidiary with the Netherlands Chamber of Commerce (KVK) before you start trading.
• For a Dutch subsidiary such as a BV, register its ultimate beneficial owners in the Dutch UBO register.
• Check whether your intermediary is a commercial agent, with statutory notice periods and a goodwill indemnity, or a distributor entitled to reasonable notice.
• Check pricing and territory clauses for resale price maintenance and absolute territorial protection, which the ACM treats as hard core restrictions.
• Sign a GDPR processing agreement with every supplier that processes personal data on your behalf.

What can we do for you with international business law?

From Eindhoven and Amsterdam, our lawyers advise Dutch and foreign companies on contracts and disputes with a Dutch connection.

• We review your international contract and general terms against Rome I, Brussels I bis and the Vienna Sales Convention.
• We draft governing law, choice of court and arbitration clauses that fit the country where your counterparty holds its assets.
• We check agency and distribution agreements for the mandatory Dutch rules on notice and the goodwill indemnity.
• We assess whether a counterparty or a shipment is caught by EU sanctions, including the fifty per cent ownership and control test.
• We enforce foreign judgments and arbitral awards in the Netherlands and conduct proceedings before the Dutch courts, the NCC or an NAI tribunal.

Summary

• Rome I lets you choose the governing law; without a choice, the law follows the contract type, but mandatory rules on consumers, employees and commercial agents still apply.
• Within the EU, a judgment is enforceable without exequatur under Brussels I bis; outside the EU, check the Hague conventions or opt for arbitration under the New York Convention.
• The Vienna Sales Convention applies to international sales of goods under Dutch law unless you exclude it expressly.
• Sanctions, export control, customs and GDPR rules apply regardless of the contract; a sanctions breach is a criminal matter in the Netherlands.

Frequently asked questions