Should I choose arbitration or German courts for a Franco‑German contract?

It depends on priority. Arbitration suits parties that value confidentiality, neutral proceedings and global enforceability under the New York Convention. German Commercial Courts suit parties seeking lower costs, specialist commercial judges and direct EU‑wide enforceability under Brussels I Recast. Use the decision matrix above to match the mechanism to your deal profile.

Can I have English proceedings in German Commercial Courts?

Yes, where the relevant Landgericht has established a designated Commercial Court under the Justizstandort‑Stärkungsgesetz and both parties agree that proceedings shall be conducted in English. Confirm designation status before drafting, and include an express English‑language sub‑clause.

How do I enforce a German judgment in France?

Under Brussels I Recast (Regulation (EU) No 1215/2012), a German court judgment is directly enforceable in France without an exequatur. Obtain the Article 53 certificate from the German court, provide a French translation if required, and file with the competent French enforcement officer.

How do I enforce an arbitral award between Germany and France?

Enforcement proceeds under the New York Convention (1958). File an exequatur application before the Tribunal judiciaire in France with a certified copy of the award, the arbitration agreement and a French translation. French courts apply a pro‑enforcement standard; refusal is limited to the grounds in Article V of the Convention.

What must a modern dispute resolution clause include after Germany's 2026 reforms?

At minimum: the specific forum or arbitral institution, the seat or venue city, language of proceedings, choice of substantive law, escalation steps and timelines, an interim‑relief mechanism, costs allocation, and provisions for consolidation where multiple contracts are involved. See the clause drafting checklist above for the complete mandatory‑fields list.

Is arbitration confidential in Germany?

Arbitration proceedings seated in Germany are not automatically confidential by statute. Confidentiality arises from the applicable institutional rules (DIS Rules contain confidentiality provisions) and from express party agreement. By contrast, German state‑court proceedings and judgments are public. If confidentiality is important, include an explicit confidentiality clause alongside the arbitration clause.

Can a jurisdiction clause be severed from the rest of the contract?

Yes. Under both German and French law, dispute resolution clauses, whether arbitration agreements or jurisdiction clauses, are treated as procedurally autonomous from the underlying contract. The invalidity or termination of the main contract does not automatically invalidate the dispute resolution clause. This principle of separability (Trennbarkeit / autonomie de la clause compromissoire) is well established in the case law of the Bundesgerichtshof and the French Cour de cassation.

Dispute Resolution Clause Germany

Every dispute resolution clause Germany practitioners draft for Franco‑German commercial contracts must now reckon with a fundamentally altered litigation landscape. The Justizstandort‑Stärkungsgesetz, Germany’s landmark statute to strengthen the country as a venue for commercial dispute resolution, has introduced specialised Commercial Courts (Commercial Courts), opened the door to English‑language proceedings in certain matters, and reshaped the cost‑benefit analysis that once pushed cross‑border parties reflexively toward arbitration. At the same time, proposed amendments to Germany’s arbitration law signal further change ahead.

This guide walks GCs, in‑house teams and external counsel through the new decision framework, provides annotated bilingual clause templates, and maps the enforcement routes between Germany and France so that your next jurisdiction clause is fit for purpose under the 2026 regime.

Executive Decision Framework, Arbitration, German Courts or Hybrid?

The threshold question in any Franco‑German deal is forum selection Germany counsel must resolve early: should the contract commit the parties to arbitration, to the German state courts, or to a hybrid mechanism? The answer depends on five variables, speed, cost, enforcement reach, confidentiality and subject‑matter expertise. Below are three worked scenarios that illustrate how these variables interact in practice.

SME share‑purchase agreement (value under €5 million). Cost sensitivity is high, and both parties want a binding outcome within twelve months. A specialised Commercial Court chamber in Frankfurt or Hamburg, where English proceedings Germany reforms now apply, typically delivers faster first‑instance resolution at lower cost than institutional arbitration. Enforcement in France is streamlined under Brussels I Recast (Regulation (EU) No 1215/2012).
Long‑term industrial supply contract (recurring disputes likely). Confidentiality matters, and the French supplier wants a neutral forum. Institutional arbitration under DIS or ICC rules, seated in a German city, offers confidential proceedings, party autonomy on procedure, and global enforceability under the New York Convention.
Franco‑German joint venture (multi‑party, multi‑contract). A hybrid or multi‑tier escalation clause, mediation first, then arbitration, allows the parties to preserve the commercial relationship before escalating to binding resolution. Consolidation mechanics in the DIS Rules simplify multi‑contract disputes.

Quick Decision Matrix, Arbitration vs German Courts

Criterion	Arbitration (typical outcome)	German Commercial Courts (typical outcome)
Interim relief speed	Fast, emergency arbitrator available under DIS and ICC rules	Fast in specialised Commercial Court chambers (post‑2026 reforms)
Enforceability in France	Enforceable under the New York Convention (1958)	Enforceable under Brussels I Recast, direct recognition, no exequatur
Cost profile	Higher upfront (institution fees + arbitrator fees)	Court fees calculated by statutory schedule; generally lower, but procedural length varies
Confidentiality	Proceedings and award confidential (subject to institutional rules and party agreement)	Court hearings and judgments are public
Language flexibility	Full party autonomy, English, French or German	English permitted in designated Commercial Courts; otherwise German
Appellate review	Very limited grounds for setting aside (§ 1059 ZPO)	Full appeal on law and (limited) facts to the Oberlandesgericht

Industry observers expect the new Commercial Courts to attract mid‑market Franco‑German disputes that would previously have defaulted to arbitration solely because German courts could not conduct proceedings in English. That dynamic is worth monitoring as case volumes build through 2026 and 2027.

Germany’s 2025–2026 Reforms That Change the Calculus

The Justizstandort‑Stärkungsgesetz (Act to Strengthen Germany as a Venue for Dispute Resolution), published in the Bundesgesetzblatt (BGBl), represents the most significant overhaul of Germany’s commercial litigation infrastructure in decades. Its core objective is to make German state courts a competitive alternative to London, Paris and international arbitration for high‑value cross‑border commercial disputes.

What Changed for Venue, Language and Interim Measures

The reforms operate on three axes. First, designated Landgerichte (Regional Courts) may now establish Commercial Courts, specialised chambers with jurisdiction over international commercial matters exceeding certain value thresholds. Second, parties may agree that proceedings before these Commercial Courts will be conducted in English, removing the long‑standing language barrier that deterred foreign claimants. Third, interim‑measures procedure in commercial matters has been streamlined, with tighter timelines for oral hearings on urgent applications.

Reform element	Effective date	Clause drafting implication
Creation of Commercial Courts at designated Landgerichte	Provisions effective from 2025 (staggered roll‑out by Land)	Specify the exact court (e.g., Landgericht Frankfurt am Main, Commercial Court) in the jurisdiction clause; confirm the court is designated
English‑language proceedings by party agreement	Provisions effective from 2025 (subject to each Land designating courts)	Add a bilingual language‑of‑proceedings sub‑clause and confirm that both parties expressly consent to English
Streamlined interim‑measures timetable	Effective upon respective Land designation	Consider whether a split clause (courts for interim relief, arbitration for merits) is still necessary
Concentration of international commercial expertise in specialist judges	Ongoing as judicial appointments fill designated positions	Evaluate the maturity of the chosen court’s Commercial Court bench before committing in the clause

General counsels negotiating a jurisdiction clause for a Franco‑German transaction should verify which Landgerichte have formally established Commercial Courts and whether the chosen seat offers proceedings in English. The Federal Ministry of Justice (Bundesministerium der Justiz) publishes implementation updates on its website. A dispute resolution clause Germany practitioners draft today must therefore name the specific Commercial Court and include an express language agreement.

What Is ADR in Germany?

Alternative dispute resolution (Alternative Streitbeilegung) in Germany encompasses mediation, conciliation, expert determination and arbitration. Mediation is governed by the Mediationsgesetz (Mediation Act). Arbitration is primarily regulated by §§ 1025–1066 of the Zivilprozessordnung (ZPO), which closely follows the UNCITRAL Model Law. ADR mechanisms are frequently combined in multi‑tier dispute resolution clauses for Franco‑German contracts.

Arbitration in Germany, Seat, Institution, Rules and Interim Relief

Arbitration remains the preferred mechanism for high‑value or confidentiality‑sensitive Franco‑German disputes. Germany’s arbitration law, codified in Book 10 of the ZPO, provides a modern, Model‑Law‑aligned framework. The choice of seat determines the procedural law (lex arbitri) and the courts available for support and challenge, making it a critical clause variable.

When weighing arbitration vs German courts, practitioners should note that an arbitral award seated in Germany benefits from enforcement in over 170 jurisdictions under the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York Convention, 1958). Both France and Germany are contracting states. By contrast, a German court judgment is directly enforceable within the EU under Brussels I Recast but may require separate treaty routes outside Europe.

Institutional arbitration under DIS (Deutsche Institution für Schiedsgerichtsbarkeit) rules is the most common choice for Germany‑seated proceedings. The DIS Rules provide for an emergency arbitrator mechanism, expedited proceedings, multi‑party and multi‑contract consolidation, and a structured costs regime. For Franco‑German contracts where the French party prefers a pan‑European institution, ICC arbitration seated in Germany is a credible alternative.

DIS Model Clause, Annotated

The DIS publishes recommended model clauses on its website. A standard DIS arbitration clause for a Franco‑German contract might read:

“All disputes arising out of or in connection with this contract or its validity shall be finally settled in accordance with the Arbitration Rules of the Deutsche Institution für Schiedsgerichtsbarkeit e.V. (DIS) without recourse to the ordinary courts of law. The arbitral tribunal shall consist of [one / three] arbitrator(s). The seat of the arbitral proceedings shall be [Frankfurt am Main / another German city]. The language of the arbitral proceedings shall be [English / German]. German law shall apply to the merits of the dispute.”

Seat. Choose a city with an active Commercial Court for parallel interim‑relief applications. Frankfurt, Hamburg and Munich are common.
Language. English is standard for Franco‑German contracts. A bilingual clause (langue de la procédure / Verfahrenssprache) avoids later disputes over interpretation.
Emergency relief. DIS Rules provide an emergency arbitrator. If the parties also want access to German state‑court interim measures (§ 1033 ZPO), confirm this expressly.

Proposed Arbitration‑Law Amendments, Drafting Implications

The Federal Ministry of Justice has published a draft bill to modernise Germany’s arbitration law (§§ 1025 ff. ZPO). As of mid‑2026, the proposals remain at the legislative‑consultation stage and have not yet been enacted. Key proposals include express provisions on remote hearings, updated rules on arbitrator challenges, and enhanced court‑support mechanisms. Early indications suggest the reform will align German arbitration law more closely with recent UNCITRAL guidance and may attract additional Franco‑German disputes to German‑seated arbitration once enacted.

Litigation in German Commercial Courts, Language, Procedure and Tactical Considerations

The newly established Commercial Courts Germany now offers represent a genuine alternative to arbitration for mid‑market Franco‑German disputes. Their competitive advantages include lower costs (court fees are calculated on a statutory scale rather than ad valorem arbitrator fees), specialist commercial judges, and direct enforceability across the EU.

Proceedings in Commercial Courts follow the Zivilprozessordnung (ZPO), with several adaptations for international commercial disputes. Evidence is taken in accordance with German procedural rules, meaning limited pre‑trial discovery compared to common‑law jurisdictions, but structured document‑production upon request. Cost risk follows the loser‑pays principle (Kostentragungspflicht), which materially affects litigation strategy.

English proceedings Germany reforms introduced by the Justizstandort‑Stärkungsgesetz allow the designated Commercial Courts to conduct proceedings in English where both parties agree. The judgment itself may be issued in English. However, the scope of this reform is limited to courts that have been specifically designated by the respective Land. In practice, counsel should confirm designation status and include an express English‑language provision in the jurisdiction clause for international commercial matters.

How to Draft Jurisdiction and Choice‑of‑Court Clauses for Germany

A well‑drafted jurisdiction clause franco‑german counsel can rely on should specify the exact court, confirm exclusivity, and address language. A sample exclusive‑jurisdiction clause might read:

“The parties irrevocably submit to the exclusive jurisdiction of the Commercial Court (Kommerzgericht) at the Landgericht [city], Germany, for all disputes arising out of or in connection with this contract. The parties agree that proceedings shall be conducted in the English language pursuant to the Justizstandort‑Stärkungsgesetz. The law applicable to the merits shall be German law.”

Drafting trap, non‑exclusive clauses. A non‑exclusive clause allows the French party to commence parallel proceedings in France under Brussels I Recast’s lis pendens rules. Unless strategic optionality is intended, make the clause exclusive.
Drafting trap, naming the wrong court. Specify the Landgericht and confirm it has a designated Commercial Court. A generic reference to “the courts of Germany” may result in proceedings before a non‑specialist chamber.
Fallback if no dispute resolution clause exists. Under Brussels I Recast, the defendant’s domicile determines jurisdiction (Article 4). For contractual claims, Article 7(1) provides jurisdiction at the place of performance. Without a clause, a Franco‑German contract may be litigated in either country, creating uncertainty that a well‑drafted clause eliminates.

Drafting the Dispute Resolution Clause, Clause Bank and Bilingual Templates

The clause bank below provides six templates covering the most common Franco‑German scenarios. Each template includes annotations identifying mandatory fields and common red‑line issues encountered during contract negotiation.

Template A, Pure Arbitration (DIS). “All disputes arising out of or in connection with this contract shall be finally settled under the DIS Arbitration Rules. The tribunal shall consist of three arbitrators. The seat shall be Frankfurt am Main. The language of the proceedings shall be English. The substantive law of the Federal Republic of Germany shall govern the merits.” Annotation: three arbitrators are appropriate for disputes above approximately €2 million; below that threshold, a sole arbitrator reduces cost.

Template B, Exclusive German Court Jurisdiction. “The parties submit exclusively to the Commercial Court at the Landgericht Frankfurt am Main. Proceedings shall be conducted in English. German law applies.” Annotation: confirm that the named Landgericht has a designated Commercial Court; add an express waiver of objections to venue.

Template C, Escalation (Mediation → Arbitration). “The parties shall first attempt to resolve any dispute through mediation administered by [DIS / ICC]. If mediation fails within 60 days of the request, the dispute shall be referred to DIS arbitration under Template A above.” Annotation: specify a hard time limit for mediation to prevent delay tactics; confirm that urgent interim measures remain available during the mediation window.

Template D, Split/Forked Clause (Courts for Interim Relief, Arbitration for Merits). “All disputes on the merits shall be resolved by DIS arbitration per Template A. Either party may apply to the Commercial Court at the Landgericht Frankfurt am Main for interim or conservatory measures at any time before or during the arbitral proceedings.” Annotation: this structure works well where speed of interim relief is critical (e.g., IP or supply‑chain injunctions) but the merits require confidential resolution.

Template E, Multi‑Tier with Step Procedure. “(1) Senior management meeting within 14 days of written notice. (2) If unresolved, mediation under DIS Mediation Rules within 30 days. (3) If unresolved, binding DIS arbitration per Template A.” Annotation: each tier must have a defined duration and a trigger mechanism; avoid “condition precedent to arbitration” language that French courts may interpret strictly.

Template F, Choice‑of‑Law + Jurisdiction Fallback (Parties Disagree on Forum). “This contract shall be governed by German law. Disputes shall be submitted to [DIS arbitration seated in Frankfurt am Main / the Commercial Court at the Landgericht Hamburg], [delete as applicable during negotiation]. If neither option is deleted, DIS arbitration shall apply.” Annotation: the fallback mechanism prevents a pathological clause if negotiators fail to choose; insert a clear default.

Clause Drafting Checklist, Mandatory Fields and Red Lines

Forum/institution. Name the specific court or arbitral institution and its rules version.
Seat (arbitration) / venue (litigation). Identify the city; do not leave blank.
Exclusivity. State whether the jurisdiction clause is exclusive or non‑exclusive.
Language of proceedings. Specify English, German or French, and confirm agreement of both parties.
Choice of law. Separate the substantive law from the procedural law and the law of the arbitration agreement.
Number of arbitrators. State one or three; include a default if the parties cannot agree.
Escalation steps and timelines. If multi‑tier, define each stage’s duration and trigger.
Interim measures. Confirm whether state‑court interim relief is available alongside arbitration (§ 1033 ZPO).
Costs allocation. State whether the loser‑pays principle applies or costs follow a different regime.
Consolidation and joinder. Address multi‑party and multi‑contract scenarios expressly.

Enforcement France Germany, Practical Steps to Enforce Judgments and Awards

The enforceability of a judgment or award in the counterparty’s home jurisdiction is the ultimate test of any dispute resolution clause. Franco‑German enforcement benefits from two powerful regimes: Brussels I Recast for court judgments, and the New York Convention for arbitral awards.

Enforcing a German Judgment in France, Step‑by‑Step Checklist

Under Regulation (EU) No 1215/2012 (Brussels I Recast), a judgment rendered by a German Commercial Court is directly enforceable in France without an exequatur (declaration of enforceability). The practical steps are as follows:

Obtain a certified copy of the German judgment and the certificate under Article 53 / Annex I of Brussels I Recast from the issuing German court.
If required by the French enforcement authority (huissier de justice), provide a certified French translation of the judgment and certificate.
File the certificate and judgment with the competent French enforcement officer to commence execution.
The debtor may apply to refuse enforcement only on the limited grounds set out in Articles 45–46 of Brussels I Recast (e.g., public policy, default of service).

The likely practical effect of this streamlined process is enforcement within weeks rather than months, a material advantage over New York Convention enforcement in non‑EU jurisdictions.

Enforcing an Arbitral Award in France, New York Convention Path

An arbitral award seated in Germany is enforceable in France under the New York Convention (1958). France, as a Convention signatory, applies a pro‑enforcement regime. The practical steps are:

Obtain the original award (or a certified copy) and the original arbitration agreement (or a certified copy).
File an application for recognition and enforcement (exequatur) before the Tribunal judiciaire of the place of enforcement.
Provide a certified French translation of the award if it is in English or German.
The French court grants exequatur unless one of the limited grounds for refusal in Article V of the New York Convention applies (e.g., invalidity of the arbitration agreement, public policy, lack of due process).
Once exequatur is granted, enforce through standard French execution mechanisms.

French courts have a well‑established track record of enforcing foreign arbitral awards. The exequatur process typically takes several months. Counsel should factor this timeline into the dispute resolution clause when advising clients on the relative merits of arbitration vs German courts for enforcement purposes.

Tactical Negotiation Tips and Red Flags in Franco‑German Drafting

Experienced practitioners recognise several pressure points in Franco‑German clause negotiations that deserve attention beyond the core templates above.

Costs clauses as bargaining chips. The French party may prefer each side bearing its own costs (frais irrépétibles), while the German side expects the loser‑pays principle. Clarify this in the clause to avoid post‑award satellite disputes.
Security for costs. If one party’s assets are primarily in a non‑EU jurisdiction, consider including a provision for security for costs or a pre‑arbitration deposit, particularly in arbitration, where recovery of costs against a losing party outside the EU can be difficult.
Multi‑contract coordination. Franco‑German joint ventures often involve multiple interrelated contracts (shareholders’ agreement, licence agreement, supply agreement). Ensure each contract’s dispute resolution clause is compatible and permits consolidation. Inconsistent clauses create parallel proceedings and conflicting outcomes.
Pathological clauses. Ambiguous or contradictory dispute resolution clauses (clauses pathologiques), for example, naming an arbitral institution that does not exist or combining exclusive court jurisdiction with mandatory arbitration, are litigated frequently in both French and German courts. Clear, tested language avoids this.

Conclusion, Recommended Dispute Resolution Clause Germany Picks by Scenario

The 2025–2026 reforms have expanded the options available to parties drafting a dispute resolution clause Germany contracts must now incorporate. The right choice depends on deal characteristics, enforcement needs and party appetite for confidentiality. As a practical summary:

Mid‑market transactions (under €5 million). Consider exclusive jurisdiction in a designated German Commercial Court with English‑language proceedings (Template B). Lower cost, direct EU enforcement, specialist judges.
High‑value or confidentiality‑sensitive deals. DIS arbitration seated in a major German city (Template A). Global enforceability under the New York Convention, full party autonomy, confidential proceedings.
Joint ventures and long‑term relationships. Multi‑tier escalation (Template E) with management negotiation, mediation and arbitration. Preserves the commercial relationship before binding resolution.
IP‑heavy or supply‑chain contracts requiring urgent interim relief. Split clause (Template D). Courts for speed, arbitration for confidential merits resolution.

Whatever the structure, every Franco‑German dispute resolution clause should specify the forum, seat, language, governing law, escalation steps, interim‑relief mechanism and costs allocation. The lawyer directory at Global Law Experts can connect you with counsel experienced in cross‑border Franco‑German commercial litigation and arbitration.

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This article was produced by Global Law Experts. For specialist advice on this topic, contact Götz Gaiser at Prelia PartG mbB Rechtsanwälte Avocats, a member of the Global Law Experts network.