Preparation of Standard Contract for Smart Farm Exports and Orders... Includes Key Clause Details and Negotiation Points

The government has prepared a standard contract for smart farm exports and orders to support the smooth overseas expansion of Korean smart farm companies.

The Ministry of Agriculture, Food and Rural Affairs (MAFRA) published the standard contract for smart farm exports and orders on the 6th in collaboration with the Korea Smart Farm Industry Association and the law firm Jipyong.

An official from MAFRA stated, "At several export company meetings held last year, many smart farm companies mentioned that due to a lack of experience in exports and orders as well as related legal knowledge, a lot of time and cost were incurred until actual contract signing, and there was a concern about concluding unfavorable contracts. Therefore, MAFRA directly addressed these field difficulties by publishing the standard contract for smart farm exports and orders together with Jipyong, a law firm with strong international capabilities."

MAFRA expects that smart farm companies will be able to reduce time and costs during negotiations and prevent damages arising from contract clauses in advance by utilizing the standard contract.

This standard contract consists of two types: equipment supply contract and turnkey order contract, each prepared in both Korean and English. The turnkey order contract reflects the characteristics of smart farm orders that require construction, operation, and aftercare, covering the entire export and order process including ▲installation ▲inspection ▲approval ▲operation and maintenance ▲warranty ▲service and repair. Additionally, to enable even novice exporting companies to easily use the standard contract, explanatory notes are included for each clause highlighting important points, negotiation tips, and alternative provisions.

Park Seong-cheol, a partner lawyer at Jipyong, explained, "Since smart farm contracts vary greatly depending on the specific circumstances of the parties involved, we included as many variables as possible in the explanatory notes to enhance usability."

The standard contract for smart farm exports and orders and its explanatory notes can be accessed as an e-book on the Korea Smart Farm Industry Association website. Going forward, MAFRA plans to hold online briefings on the standard contract for smart farm companies in cooperation with Jipyong, including Q&A sessions.

Lee Sang-man, Director of Agricultural and Food Innovation Policy at MAFRA, said, "We expect that even smart farm companies attempting overseas expansion for the first time will be able to conclude contracts easily and conveniently through the publication of this standard contract. We will continue to prepare multifaceted support measures to resolve difficulties faced by companies in the field."