ICC Model Contracts for Start-ups

What are the main features of this model?

An international business transaction requires a precise and detailed underlying contract. However, it can be expensive and time-consuming to draft such a contract oneself. The ICC Model Contracts for Start-ups respond to the market’s need for a set of reliable and equitable templates, providing clear and concise standard provisions for the various agreements common to a new business that will save parties time and money in the negotiation process.

Entrepreneurs and their start-up ventures are drivers of today’s economy, and allow creators and businesspeople across the globe to share their innovative ideas with the world. But a great idea and enthusiastic partners are not enough—to create the best conditions for success, entrepreneurs need to ensure their businesses start off with a strong legal foundation.

The majority of today’s innovative developments and initiatives come from either the research and development departments of big companies or from young entrepreneurs. In the last decade, the number of start-ups has increased rapidly and a new legal consultancy speciality has emerged to support these entrepreneurial ventures. One of the biggest problems start-ups face is the legal fees that come along with the desired legal services. Most start-ups have very limited resources, which they intend to direct to their development costs; legal fees are often considered to be a burden. In this spirit, many young entrepreneurs do not avail themselves of law firms, and instead try to move forward using online sources or without obtaining any legal support at all. This can cause significant problems later in the life of the business; small problems when disregarded at the beginning risk turning into major legal issues.

To help entrepreneurs avoid such problems and build a strong formal foundation for their new ventures, and in keeping with ICC’s mission to facilitate international trade, ICC has prepared this package of model documents that address key issues related to the formation of a corporate entity.

The package comprises:

• Model Term Sheet
• Model Shareholders Agreement
• Model Directors’ Services/Management Agreement
• Model Employment Agreement
• Model Confidentiality Agreement
• Checklist on intellectual property assignment and licensing

This package provides start-ups with a reliable set of model contracts that have been drafted by practicing international experts for new businesses that intend to operate internationally. The models have therefore been drafted without reference to any particular national law, but rather to internationally-accepted standards of international business-to-business practice. As with all model contracts, users will need to consult legal counsel to ensure that any needed adjustments are made to bring the models into compliance with the requirements of the particular applicable law.