Abstract

In the nuanced realm of international research partnerships, particularly between U.S. and European institutions, one of the most complex issues is deciding on the governing law for agreements. We will explore this challenge, highlighting fundamental differences internationally, using the U.S. common law system and the civil law traditions of most European countries as a case study. These differences can lead to divergent interpretations of contractual terms and enforcement mechanisms, making it challenging to agree on a single governing law.

The preferred strategy for U.S. institutions typically involves adhering to the laws of the state where the institution is based, minimizing financial risk and legal complexities. This local approach helps avoid the need for external counsel and ensures compliance with familiar regulations. Conversely, European partners often advocate for their legal frameworks, which they consider better suited for handling the intricacies of international collaborations.

We will evaluate the potential pitfalls of selecting a governing law, which can create uncertainties and slow down negotiations. We will also explore negotiation strategies such as a neutral jurisdiction or the inclusion of comprehensive dispute resolution mechanisms to mitigate risks. The unique approach of “remaining silent” on the governing law in a research agreement, which means deferring the decision until a dispute arises, will be closely examined. Specifically, we will delve into the implications of remaining silent, which, while reducing immediate barriers to agreement, introduces significant legal and financial uncertainties, especially if litigation in foreign courts becomes necessary.

The grey area of remaining silent suggests a more proactive dialogue might be beneficial, as there may be more common ground between U.S. and European institutions than initially perceived. We will discuss communication strategies to support this proactive dialogue.