• 2023.01.25
  • International Transaction

A case of preparation of an English language sales agreement for the purchase and sale of machinery with a Taiwanese company.

Outline of the case

Our client has decided to purchase industrial inspection machines from a Taiwanese company, and although the price for one machine is 100 million yen, it has already been confirmed that the machine will be resold to the client for 120 million yen, and if the purchase goes smoothly, the client will earn a gross profit of 20 million yen. On the other hand, since the reseller is a major Japanese company, the reseller has already sent us the reseller’s standard sales contract and has made various claims regarding the terms of the contract. Since our client is a small company, it would be financially difficult for us to pay the Taiwanese company for the purchased machinery first, so we would like to make the payment to the Taiwanese company after receiving the payment from the Japanese company. In addition, if there is a defect in the machines, the Japanese reseller will demand quality assurance responsibility, but if the same quality assurance responsibility cannot be pursued against the Taiwanese company, our advisory client will bear the entire responsibility. Therefore, our client asked us to compare the English contract with the Taiwanese company with the Japanese contract presented by the Japanese reseller, and to modify the terms of the contract so that our company would not be exposed to any risk.

Our Services

We prepared a comparison chart (matrix) between the Japanese contract presented by the Japanese reseller and the English contract (Sale and Purchase Agreement) presented by the Taiwanese company, and clarified what differences there were for each item. We then examined whether the English sales agreement should be amended based on the usual approach to international transactions, or whether it would be more appropriate to amend the agreement with the Japanese company, and clarified where and how the English agreement and Japanese agreement should be amended. We then held an online meeting with the client to clarify, clause by clause, whether or not the client was at risk and whether or not the client, as a party to the transaction, should accept such risk or propose modifications to the contractual provisions. We then drafted and proposed contract clauses in English and Japanese according to the client’s wishes. Our client proposed the amended clauses to both the Taiwanese company and the Japanese counterparty, and both companies were able to basically accept our client’s proposals and agree to amend the contract clauses. Our client was able to complete the transaction as planned, with all risks bearing, quality assurance, and payment in advance eliminated.

Advantages of Our Firm

We offer various types of English service contracts

We have drafted, translated, and reviewed (legal checks) numerous English sales contracts. Although English sales contracts are the basis of transactions, their contents may pose significant risks to your company, such as claims for large amounts of damages. We recommend that you have a legal check performed by an attorney to ensure that your company’s interests are properly protected.

We propose contract clauses according to your requirements

We draft, translate, and legally check various types of sales contracts (in English) according to our clients’ wishes. The various types range from those that set forth the basic framework of a transaction to those that provide arrangements for individual purchases and sales. We are able to handle diverse types of contracts.

We prepare quotations and mandate agreements

In principle, we will prepare a written estimate and present the estimated amount in advance, except in cases where the attorney’s fee will be a small amount. If the client agrees to the estimate, the client is required to sign an engagement. The amount of attorney’s fees is clear, so you can feel secure in your decision.

We protect your rights

It is not safe to say that a sales contract is safe once it is drawn up. Care must be taken to avoid disputes regarding the delivery of goods and payment of the price. In particular, it often leads to various claims, such as failure to pay for goods delivered or defects in the goods delivered. Our firm has a great deal of experience in dealing with these types of claims, and we try to propose appropriate draft clauses to prevent disputes.

We represent your company’s interests in the event of a dispute

Although the most favorable situation is that the promised goods are delivered and the payment is made, in practice, various disputes often arise. Based on our interpretation of the contract, we analyze the client’s risk, propose a solution to the dispute, and represent the client in consultative negotiations with the other party.

Legal fees for English sales contracts (examples)

Comparing the English contract proposed by the Taiwanese company with the Japanese contract of the reseller, we revised the English contract and the Japanese contract

The English sales contract presented by the client was quite long and complex in terms of content. Although it took more time than usual to read the terms and conditions of the agreement, we were able to obtain client’s understanding of most of our recommendations. Since the client is a client of our firm, we are offering a 20% discount from the regular price as an advisory client discount.

Attorney’s fees: 550,000 yen (including tax)

We prepared an English-language basic agreement for sales transaction

We prepared an 8-page English Basic Purchase and Sales Transaction Agreement for a client of our firm in connection with the sale of raw materials to a company in Hong Kong. We prepared the agreement using our standard form and customized it according to the client’s situation. We also prepared a Japanese translation at the client’s request. Since the client is a client of our firm, we offer a 20% discount on legal fees from the regular price as a discount for our clients.

Attorney’s fees: 352,000 yen (including tax)