A contract is an agreement which is enforceable by law. It can be long or short, formal or informal, simple or complicated, and verbal or written. Without a contract or agreement to bind the contracting parties, any international business or transaction would be impossible. Long age, people exchanged promises in making bargains and binding the conduct of others. This exchange of promises came to be known as agreement and became more and more important in the fields of business. A promise or agreement is reached as a result of the process of offer and acceptance. When an agreement is reached, a contract is formed. Once a contract is officially signed by the concerned parties, it creates legal obligations in the sense of law.

A contract is the only document between the parties to which they may refer for clarification of mutual responsibilities, it should not be viewed as merely a document that initiates transaction and then filed and forgotten by the contracting parties. It must be drafted with an awareness of the background of the law in which the transaction takes place. It is proper to obtain legal advice as to the best set of contractual terms appropriate to the product and type of business.

Though mast of the contracts have many provisions in common, each is different from the others owing to the nature of the goods, Whether we are dealing with a long or pro printed form of the contract, there are certain key provisions that every contract should contain to avoid ambiguity and possible future conflicts. Whether to include other specific provisions depends on the type of goods, shipping and insurance complexities, and degree of trust and mutual confidence existing between buyer and seller.