The Legal Foundation of Service Agreements
An international service agreement, viewed through Georgian law, rests on the general concept of obligation: by virtue of an obligation the creditor is entitled to demand from the debtor the performance of an action, and performance may also consist in the omission of an action. Moreover, by its content and character an obligation may impose on each party special good faith towards the rights and property of the other — a general foundation that embraces service contracts as well.
The principle of freedom of contract is decisive for international services too: subjects of private law may, within the limits of the law, freely conclude contracts and determine their content, including contracts not envisaged by law but not contrary to it. At the same time, a party holding a dominant position on the market bears an obligation to conclude contracts and may not unjustifiably offer a counterparty unequal terms — a limit that protects the weaker side of cross-border service relationships.
Essential Terms and the Form of the Contract
A contract is considered concluded where the parties have agreed on all its essential terms in the form provided for that purpose. Terms are essential where agreement on them must be reached at the request of one of the parties, or where they are deemed such by law. For international services this means that the description of the services, quality criteria and the measurement of results must be defined in advance — otherwise the contract's very existence may be contested.
A contract may also give rise to an obligation to conclude a future contract — a preliminary contract to which the form provided for the main contract extends. This instrument allows complex projects to be structured in stages: first the framework of cooperation, then the full contract. For cross-border engagements, the preliminary stage is where the parties test commercial terms without yet assuming the full scope of obligations.
Standard Terms in International Services
International service agreements frequently contain standard terms — clauses pre-formulated for repeated use, which one party imposes on the other and through which rules differing from or supplementing the law are established. Under the law, terms defined in detail by the parties themselves are no longer regarded as standard, and terms individually negotiated by the parties take precedence over standard ones — a rule protecting the client from useless points imposed through forms.
Standard terms become an integral part of the contract only where the offeror makes a clearly visible inscription at the place of conclusion and indicates the terms, and the other party has the opportunity to familiarise itself with their content and, if it agrees, to accept them. Towards an entrepreneur counterparty it is sufficient that the terms were to be considered upon showing the necessary diligence — a business partner is expected to pay closer attention. Knowing these rules helps to challenge unfair clauses in time.