International Contracts & Agreements
Well-designed contracts help you and your project partners and subcontractors begin a project with clear expectations of costs and your respective roles and responsibilities. If the contract involves services to be rendered overseas, or if one of the contracting entities is foreign, there are steps you can take to avoid surprises and protect Harvard’s interests.
You can start by:
- Considering the unique components of an international contract.
- Identifying the entity with whom you're contracting and which type of contract to sign.
- Identifying who at Harvard needs to review and sign the contract.
And then consult with us or one of the relevant offices identified below to discuss your project.
5 International Contract Considerations
International contracts present unique considerations in addition to the routine tasks of writing and signing contracts.
Foreign exchange rates can affect your project budget. Based on the business need, determine which currency the payments are made in and how the foreign exchange is handled. You should also be precise about how currencies are designated (e.g. "$" may mean dollars or pesos).
Governing Law and Dispute Resolution
Many contracts include a clause identifying the governing law for the contract and the method of dispute resolution. Determine which jurisdiction would see lawsuits resulting from the contract; if it’s outside the U.S., you’ll need to confirm that Harvard is comfortable with the foreign law.
Under University policy, contracts for foreign activities other than simple service agreements should contain non-discrimination provisions. Examples include contracts under which the foreign party is involved in inviting people to events such as conferences, courses, and workshops; providing services to such people; or recruiting individuals to provide services to Harvard.
Certain activities abroad may trigger requirements for a permit, registration to do business, or compliance with foreign legal regulations. Confirm if any Harvard activity under the contract will subject Harvard to such requirements. Additionally, activities conducted by your foreign collaborator—such as human subject research or the use of personal data—could also be subject to specific regulations. Work with the other party to make clear who will be responsible for compliance with these legal requirements.
Although Harvard is tax-exempt in the U.S., it doesn’t automatically receive this exemption from foreign countries. Confirm whether the contract will cause Harvard to be taxed in the foreign jurisdiction or if taxes will be withheld from payment to or from Harvard.
Tip: Consider making the other party responsible for any local taxes, whether Harvard is the payer or the payee. Also consider whether Harvard employees working in country may be subject to local tax on a proportionate share of their income. Learn more about international taxes.
Types of Contracts
There are three common types of non-employment contracts regularly used for Harvard's international projects.
A collaboration agreement or memorandum of understanding (MOU) is typically an agreement between two parties who share administration of a program. Sometimes the MOU articulates a standard arrangement that may apply to many programs. The MOU clarifies the nature of the work, the expectations and obligations of the parties, ownership of the work product, and allocation of costs and liabilities.
OGC reviews these agreements, as does the Vice Provost for International Affairs if the agreement is with a foreign government agency.
A grant subcontract engages a subrecipient (third-party organization) to perform a portion of a sponsored project. Harvard may be the primary recipient overseeing the subrecipient, or Harvard may be a subrecipient on a grant issued to another organization.
This type of contract is often used by Harvard to delegate in-country management to an organization with local knowledge or infrastructure in that country. In some cases, overseas grantors may find it advantageous to award a grant to a local organization but make Harvard a subrecipient for those portions of the grant that require specialized knowledge. The Office for Sponsored Programs (OSP) provides detailed information on subcontracts.
A service agreement or consulting agreement is between Harvard and the other party (a business, university, non-profit, or individual) who, wherever located, agrees to provide a service in the foreign country in exchange for a fee, but does not assume responsibility for a project beyond the deliverables specified in the agreement. The Office of the General Counsel’s (OGC) model consulting agreements provide a good starting point. And because each case is unique, the contacts below can help you create an agreement that meets your specific needs.
Who Can Sign Contracts & Agreements
Any contract, including an MOU, with a foreign government agency must be signed by the relevant Dean and the Provost’s designee. OSP maintains a summary of review and signature requirements.
Contracts should not be signed for Harvard outside of the U.S., unless advised otherwise by OGC, as signing contracts in another country may be seen as doing business in that country.
Contact one or more of the following offices based on your project's needs.
- Contracts relating to grant-funded projects, including service agreements and subcontracts: Office of Sponsored Programs (University area) or Sponsored Programs Administration (Longwood Medical area)
- Vendor agreements: Strategic Procurement
- Agreements involving a foreign government: Office of the Vice Provost for International Affairs
- General advice: GSS or OGC