As a governing law, the New York law is second to none in benefiting your foreign trade deals.
Have you ever encountered a cross-border deal?
Remember one of its most crucial legal issues?
You bet, it’s choice of governing law.
Here’s what you’ll now discover:
That is the law that governs the contractual relations of the parties. It can, for example, be the law of a jurisdiction related to either party, the contract, or its subject matter. The parties may, of course, choose such a law as they deem appropriate.
Each party understandably wants to apply the law of its own country, rather than that of the other party’s. That’s because one hardly wants to subject oneself to a foreign, unknown, and unpredictable law. Right? So, this issue may cause a tough debate. It may not only shake your partner’s trust but also hamper your dealmaking.
To help you out, wouldn’t it be nice to choose a law that is internationally accepted and highly regarded? The one that may be a mutually beneficial compromise.
You likely guessed it right. We’re talking about the law that applies in the US financial capital, i.e., New York.
So what are your advantages to using the New York law?
Benefits of New York Law
Applying the NY law, you avail yourself of the following favors:
- Well-developed, stable, and transparent legal framework;
- Clear and user-friendly commercial law;
- Respect for party autonomy, freedom of contract, and choice of law;
- Contract interpretation that conforms to your expectations;
- Recognition of a duty of good faith and fair dealing in contractual performance;
- Adherence to international treaties and commercial standards;
- Well-defined process for judgements to become final;
- Awards and judgements enforceable abroad;
- Enforcement of contractual limits on damages;
- Recognition of third-party beneficiary rights;
- Deference to parties’ choice in allocation of attorneys’ fees;
- Sophisticated courts accessible to foreign parties;
- Effective provisional remedies;
- Counter-party and attorney confidentiality;
- Possibility to waive jury trials;
- Protection of security interests; and
- Reliable and prompt enforcement of arbitration clauses, arbitration awards, and foreign court judgements.
Don’t these benefits suffice for you to select the right governing law?
They are more than enough to satisfy even the most sophisticated dealmakers. As you might particularly suspect, the New York law comfortably accommodates some of the largest global deals.
As you see, the New York law gives you plenty of flexibility, reliability, and predictability in your cross-border business relations. After all, this is the law of the financial center of the world.
Any residual doubt? Then check out this publication by the New York State Bar Association and New York International Arbitration Center.
In conclusion, you now know your top legal option to guide your business relations.
To learn about business incorporation, check out how to open your company in the US.
If you wish to start a business in New York, feel free to download our business setup checklist (infographic).
Good luck with your international deals!