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What Is A Cross Border Agreement

A German manufacturer of special equipment wanted to buy its American distributor. The American distributor owed a lot of money to the German manufacturer for ordered products. The German manufacturer asked for help and we tried to convert the debt into equity and take over the American distributor. I drafted a Memorandum of Understanding and a share purchase agreement and performed the interim due diligence. Unfortunately, the U.S. dealer filed Chapter 11 and we had to register the claims in the next bankruptcy proceedings. To meet the demands of an ever-changing global market, companies often seek to expand their business through cross-border mergers and acquisitions. In an international transaction, the parties must take into account a unique aspect of the agreement – the legal framework in which the agreement and all contractual agreements must be settled within the framework of the agreement. The American company had for decades distributed world-leading products from a German manufacturer without a written distribution agreement. The American distributor now had to be taken over by a large American company that wanted to see a written distribution agreement. The American distributor contacted me to negotiate a written sales contract with the German manufacturer. Unfortunately, we discovered that the U.S.

distributor had no distribution rights, but only a right to sell as a licensed distributor. The German producer did not wish to conclude a binding distribution agreement and the agreement failed. A U.S. device distributor has entered into a joint venture with a German manufacturer. The joint venture has become the exclusive distributor of the manufacturer`s products in the United States. We have structured the joint venture as a company and I have worked closely with the German tax advisor to structure the agreement so that no tax problems arise. The shareholder and the distribution contract required careful drafting of the product description, territory and non-competition prohibitions for control rights. One of the most important decisions that will be made by the parties to a cross-border transaction is the choice of the right to concentrate.

Most courts in most countries will respect the right of the parties to decide which right to apply. But the choice itself will depend on a number of factors. Again, in the United States, the choice of law will often be a state`s responsibility, as this is where most contract and business law issues are dealt with. A cross-border transaction is in fact any transfer of ownership, goods or services between individuals or companies established in different jurisdictions. The transaction itself can be as simple as buying widgets over the Internet from China or as complex as multi-level joint venture investment structures in another country with complex service and distribution agreements. Each of these types of cross-border transactions can raise a large number of legal issues on both sides. This clause is sufficient for a “national” American country.