Language Supremacy Clauses in Korean Agreements Governed by Korean Law

Language Supremacy Clauses in Korean Agreements Governed by Korean Law

A language supremacy clause dictates what language governs the interpretation of a contract. Many international contracts are drafted in multiple languages. However, because of the complexity of legal terms, lack of precision in certain languages, the nature of language translation, and other local realities it is best to choose a governing language to avoid the issue of an alleged discrepancy between the Korean and English-language versions of the contract. In most cases, we advise choosing English as the governing language in a Korean contract if one party is not a Korean party. The English language tends to lend itself to more precision than the Korean language and the negotiation of the contract shall, likely, be in the English language, thus, in reality, the Korean version of the agreement shall be a translation of the English.

The, typical, short-form clause utilized in agreements in Korea is a clause such as:
“In case of a discrepancy between the English and Korean versions of this contract, the English version shall prevail.”

A, typical, clause utilized with a Governing Law clause is as follows:
“This Contract shall be governed, construcued and enforced according with the laws of the Republic of Korea, without regard to any conflict of law principles thereof. In the event of any conflcit between the English language version of ths Contract and any translation hereof, the English language version shall prevail.”

The choice of the English language as the governing law is legal, in Korea, in the majority of agreements. Thus, an English-language version of an agreement in Korea, in most cases, is legal and enforceable. However, in many cases, IPG Legal advises the drafting of a Korean-language version of an English-language agreement to avoid the counterparty claiming the lack of a “meeting of the minds.” See Korean Contracting Drafting Issues for details on challenges based on the lack of a meeting of the minds and other contract drafting necessities.

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