France: International Contracts And Dispute Resolution

Last Updated: 24 March 1997
Dispute resolution clauses in international contracts are not a novel subject. However, with the global nature and increasing technical and legal complexity of international commercial projects, it is clear that in many instances parties to international contracts fail to select dispute resolution methods appropriate to their particular needs and objectives. Sometimes the dispute resolution clause is a rapidly added "afterthought" at the end of tough contract negotiations. In other instances, especially in complex projects, although detailed discussion has taken place on the dispute resolution clause, once the project is underway, the method(s) of dispute resolution chosen turn out to be ill-adapted to the practicalities of the project (e.g., in a construction contract the parties need to be able to obtain a fast decision that will allow them to progress the work). What, therefore, are the main points to be borne in mind when putting in place a dispute resolution clause?

First, dispute resolution clauses should not be confused with clauses that choose the law governing the contract. Whilst this article will not discuss the law governing contracts, it is nevertheless worth noting, for "European" purposes, that the Rome Convention on the Law Applicable to Contractual Obligations (1980) has now been ratified by 15 European countries: it provides that a contract will be governed by the law chosen by the parties and, if the parties have made no choice, by the law of the country with which the contract is most closely connected.

Second, it should be ensured that dispute resolution clauses (which, in complex projects, may contain a hierarchy of dispute resolution steps) include a mechanism capable of finally resolving disputes. Such a mechanism will usually be either a national court or arbitration (the latter being a private procedure where the parties appoint one or more arbitrators to reach a decision on their dispute). If arbitration is chosen as the binding method of dispute resolution, the contract parties will have to make a further choice between institutional arbitration (where an arbitration institution, e.g., the International Chamber of Commerce, undertakes the administrative organisation of the arbitration and the arbitration proceeds in accordance with the rules of the institution) and ad hoc arbitration (organised by the parties themselves and in accordance with their own rules).

Third, it must be pointed out that the choice of dispute resolution forum is project-specific. There may be reasons why parties will not wish to have recourse to national courts: understandably, neither party may be enthusiastic about submitting to the jurisdiction of the national courts of the other party; the parties may not wish their grievances to become public; they may prefer to choose persons with appropriate technical knowledge to resolve their disputes; they may wish to avoid complicated procedure and presentation of their case, including often voluminous documentation, in a foreign language; they may wish to obtain a ruling not in law, but in pure equity or trade usage (e.g., in the Channel Tunnel project, the Canterbury Treaty of 12 February 1986 between the United Kingdom and France provided, in connection with the resolution of disputes regarding the Concession, that, inter alia, "recourse may also be had to the relevant principles of international law, and if the parties in dispute agree, to principles of equity"). If the foregoing are considerations, then arbitration should be considered. However, there may be occasions where the parties have no alternative but to submit to the jurisdiction of the national courts (e.g., in some countries public bodies are not entitled to have recourse to arbitration; in other countries, certain areas of law may not be arbitrated, e.g., certain aspects of intellectual property law in France). On other occasions, the parties may simply prefer to have recourse to national courts: they may wish their case to be publicly heard and judged; in some countries and for some types of disputes the national courts may be the better option from the cost point of view. The foregoing advantages and drawbacks of the national courts and arbitration are not intended to be exhaustive or to favour recourse to one or the other: this decision must be made in the light of each individual contract and its parties.

Fourth, having decided on the appropriate binding method of dispute resolution, consideration may and in some circumstances should be given to including a preliminary, non-binding method of dispute resolution which may assist the parties in reaching settlement of a dispute at an early stage, whilst leaving open the possibility of referring the dispute to arbitration or the national courts if the parties are not satisfied with the settlement proposed. Such preliminary, non-binding methods of dispute resolution are sometimes referred to as Alternative Dispute Resolution ("ADR") and are frequently put forward as being a novel means of resolving disputes. Some of these methods are in fact traditional methods such as straightforward negotiations between the parties or mediation or conciliation(note1), where a neutral third party is appointed to assist the parties and steer them towards a mutually acceptable resolution of their dispute. Others are well-known mechanisms contained in standard terms and conditions of contract published by international organisations, such as the FIDIC Conditions of Contract for Works of Civil Engineering Construction, where disputes initially have to be referred to the Engineer appointed under the contract. Yet others are more recent, such as Dispute Review Boards, now compulsory in certain projects financed by the World Bank. Also becoming popular, particularly in the United States, are dispute prevention (rather than resolution) mechanisms such as partnering, where both parties participate in a programme designed and run by third parties to help them avoid disputes and work towards common aims. Again, the foregoing is not intended to be an exhaustive list of possible preliminary dispute resolution mechanisms, and the need for such a mechanism should be considered in the circumstances of individual contracts.

In conclusion, frequently the dispute resolution clause chosen will contain the above two stages (preliminary non-binding method, followed by binding method), or in an especially complex project, may involve a multiple step clause (e.g., the various actors in the UK railway industry are subject to a hierarchy of dispute resolution mechanisms). No general rules can be made as to which methods should be chosen. The only rule to be borne in mind is that the clause should be tailored to the needs and objectives of the particular contract, with the aim of disposing of disputes as fairly, quickly and cheaply as possible.

Note1:In some countries, dispute resolution methods such as conciliation or mediation may have a particular meaning under national law. Consequently, if reference is made to these methods in a contract, it should be made clear whether the reference is to mediation as understood under a national law or to an ad hoc procedure.

Written by Gillian C. Lemaire, Archibald Andersen, Association d'Avocats, Avocat a la Cour (Hauts-de-Seine Bar, France), Solicitor (Scotland)

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

For further information, please contact Kristine Karsten, Archibald Andersen Association d'Avocats, Partner S.G.Archibald, Tour Gan - Cedex 13 - 92082 Paris La Defense 2 - France. Tel: (331) 55 61 10 10, Fax: (331)55 61 15 15

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Mondaq Advice Centre (MACs)
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.