Practice Area
Commercial Contracts
We draft, negotiate and repair the contracts a business runs on: master services agreements, NDAs, SaaS terms, licences, vendor and procurement contracts, and distribution arrangements. The work is done under Pakistani law as it actually operates — the Contract Act 1872, provincial stamping, and courts and arbitrators as they really behave.
Contracts are the operating system of a business, and most Pakistani businesses run on unpatched code: a template from a friend, a foreign form with the names changed, or nothing at all until the first dispute. Our commercial contracts practice exists to replace that with paper that fits — drafted for what the business actually sells, negotiated against what counterparties actually demand, and enforceable in the forums where a Pakistani dispute would actually land.
The core statute is the Contract Act 1872, and it rewards familiarity. Section 27 quietly voids the non-competes that foreign templates scatter through distribution and services agreements. Sections 73 and 74 decide what a liquidated-damages clause is really worth. The Sale of Goods Act 1930 fills gaps in procurement contracts whether or not the parties considered it. The Electronic Transactions Ordinance 2002 makes click-through and e-signed contracting workable, on conditions. And underneath everything sits the provincial stamp regime, which never affects whether a deal is agreed and frequently affects whether it can be proved. Drafting in Pakistan means drafting with all of this in view, as of the current law, and we date our advice accordingly.
The practice covers the full commercial stack. Master services agreements and statements of work for services businesses. SaaS subscription terms, both the self-serve click-through and the negotiated enterprise form with its security and liability schedules. NDAs drafted to be enforced, not just exchanged. Technology and brand licensing, inbound and outbound, with the tax and remittance mechanics thought through. Vendor and procurement frameworks with service levels and exits. Distribution and dealership architecture — territory, targets, pricing within Competition Act 2010 limits, and termination provisions written while everyone is still friendly.
We also think about the end at the beginning. Every contract we draft is tested against the question a litigator would ask: if this goes wrong, what do we point to, in which forum, and how fast? That is why our cross-border contracts usually carry arbitration clauses that work under the 2011 Act rather than exclusive foreign court clauses that do not travel, and why our confidentiality and exclusivity provisions are drafted with interim relief under the Specific Relief Act 1877 in mind.
For clients with volume, the engagement matures into templates and playbooks — a contract stack the sales team can run at speed, with legal involved only where judgment is needed. The measure of a contracts practice is not the elegance of a single document; it is whether the business can sign quickly, sleep soundly and, on the rare bad day, enforce.
When Businesses Need This
The moments this practice exists for.
- 01An enterprise customer has sent you their forty-page MSA and you need it negotiated without losing the deal — or your own paper is a two-page template that no longer matches your business.
- 02You sell SaaS on terms copied from a US company, with Delaware law, auto-renewals and liability language that has never been tested against Pakistani law or your actual customers.
- 03You are appointing distributors or dealers and have no written architecture for territory, targets, pricing rules or — the part that always matters later — termination.
- 04Your production depends on one vendor and the contract has no service levels, no step-in rights and no exit plan.
- 05You are about to share confidential information — with an investor, a partner, a manufacturer — and need an NDA that is more than a ritual.
- 06You are licensing technology or brand in or out of Pakistan and need the IP, payment and enforcement mechanics to survive both tax and dispute.
- 07A dispute just showed you what your contracts were missing, and you want the whole stack repapered before it happens again.
How It Works
The process, stage by stage.
1
Deal understanding
We start with the commercial bargain, not the document: what is being bought, what failure looks like, who carries which risk, and what ending the relationship should cost. Ten minutes on this saves ten drafts. The lawyers who skip it produce contracts that are legally tidy and commercially wrong.
2
Draft or mark-up
We produce the first draft when you hold the pen, or a disciplined mark-up when the counterparty does. Mark-ups are triaged: points that are dangerous, points that are expensive, and points that are merely irritating — so negotiation capital is spent where it matters.
3
Negotiation
We negotiate directly or brief you to, depending on the relationship. On recurring counterparty types — enterprise customers, foreign licensors, public-sector buyers — we know which clauses genuinely move and which requests waste a round.
4
Signing mechanics
We handle the unglamorous part that decides enforceability: stamping under the applicable provincial regime, execution by someone actually authorised, and electronic signature done in a way the Electronic Transactions Ordinance 2002 supports. An unstamped, wrongly signed contract is a problem discovered only in court.
5
Templates and playbooks
For contracts you sign repeatedly, we build the template and a negotiation playbook — the fallback positions, the walk-away points, the clauses sales may concede without calling a lawyer. This is how legal cost per contract falls while quality rises.
The Legal Framework
The law this work runs on.
- Contract Act, 1872
- The foundation of all of it: formation, consideration, performance and breach. Its specific sections shape drafting daily — section 27 renders most restraints of trade void, and sections 73 and 74 govern damages and cap what a liquidated-damages clause can actually deliver.
- Sale of Goods Act, 1930
- Supplies the implied conditions and warranties in contracts for goods — title, description, merchantable quality — and the rules on passing of property and risk. Procurement and distribution contracts are drafted with and against it.
- Specific Relief Act, 1877
- Determines which promises a court will actually enforce in kind — injunctions and specific performance — versus those that resolve only into damages. It is why confidentiality and exclusivity clauses are drafted with interim relief in mind.
- Electronic Transactions Ordinance, 2002
- Gives electronic records and signatures legal recognition, which is what makes click-through SaaS terms and e-signed agreements workable in Pakistan. The recognition has conditions, and signature flows should be designed to meet them.
- Stamp Act, 1899 (as applied provincially)
- Stamping is provincial — in Punjab through the e-stamping system — and an insufficiently stamped instrument faces admissibility objections in evidence until the duty and penalty are made good. Rates and procedure vary by province and instrument type, and we confirm the current position at signing [RATES — TO BE VERIFIED AT EXECUTION].
- Arbitration Act, 1940 and the Recognition and Enforcement (Arbitration Agreements and Foreign Arbitral Awards) Act, 2011
- The 1940 Act governs domestic arbitration; the 2011 Act implements the New York Convention for foreign awards. Together they are why a well-drafted arbitration clause is usually the most enforceable dispute mechanism in a cross-border contract.
- Competition Act, 2010
- Reaches distribution and licensing terms — exclusivity, resale price maintenance, tying — where they restrict competition. Distribution networks of any scale should be designed with the Competition Commission of Pakistan's practice in view.
Statutory references are stated as of the page’s as-of date and flagged where verification is pending; the law moves, and the current position should be confirmed before relying on it.
Common Mistakes
The errors we see most — and their price.
- Signing on unstamped or under-stamped paper, then discovering at trial that the contract faces an admissibility objection before anyone reaches the merits.
- Assuming a liquidated-damages clause pays out as written — under section 74 of the Contract Act 1872 a court awards reasonable compensation not exceeding the named sum, and evidence of loss still matters.
- Imposing non-compete covenants on distributors, vendors or counterparties as if they were enforceable, when section 27 voids most restraints of trade outside narrow exceptions.
- Accepting unlimited liability, or an indemnity with no cap, in a vendor or customer contract because nobody modelled the worst case.
- Choosing foreign courts as the exclusive forum without asking whether their judgment can be enforced in Pakistan — a question with a much less comfortable answer than for arbitral awards.
- Letting auto-renewal and evergreen clauses run the relationship because no one diarised the notice window.
- Using one NDA template for every situation, so the document is too broad to be enforced and too vague to be breached.
- Selling into Pakistan on foreign-template SaaS terms that ignore local tax withholding, stamping and consumer-facing requirements.
Representative Scenarios
The shape of the work.
Illustrative scenarios, not case reports — composites drawn to show how matters of this kind run.
- —A SaaS company landing its first bank customer received a security and liability schedule longer than its own MSA. We negotiated the uptime, audit and breach-notification terms to what the company could actually perform, and capped liability at a level its insurance supported.Illustrative
- —A manufacturer terminated a long-standing dealer and faced a claim built on decades of course-of-dealing because no written agreement existed. We settled the dispute, then papered the entire network with term, territory and termination provisions.Illustrative
- —A company sourcing critical components from a single vendor faced a supply collapse with no contractual remedy. The renegotiated agreement added service levels, staged deliveries, step-in rights and a qualified second source.Illustrative
- —A licensor discovered its Pakistani licensee sublicensing beyond scope. Because the licence had audit rights and a well-drafted arbitration clause, the matter resolved in months on the strength of the paper rather than years on the strength of hope.Illustrative
Questions, Answered
What clients ask about commercial contracts.
Yes, as of mid-2026, under the Electronic Transactions Ordinance 2002, which recognises electronic signatures and records. The practical questions are evidentiary — proving who signed and that the record is intact — so the signing flow matters as much as the legal recognition. Certain instruments still warrant wet ink and stamping as a matter of practice.
Most written instruments attract provincial stamp duty — in Punjab through e-stamping — and an unstamped or under-stamped document faces objection to its admissibility in evidence until duty and penalty are paid. The contract is not void, but its enforcement becomes slower and costlier at exactly the wrong moment. We stamp at signing, not at litigation.
Confidentiality obligations are enforceable as contracts, and interim injunctions are the remedy that matters, since damages for a leak are hard to prove. Enforceability improves with precision: define what is confidential, who may see it, for how long, and what return or destruction means. A vague NDA is signed easily and enforced badly.
Yes — liability caps and exclusions of indirect loss are standard and generally given effect between commercial parties, subject to the Contract Act's limits. The negotiation is really about the exceptions: confidentiality breaches, IP infringement and indemnity claims usually sit outside the cap, and that is where the true exposure lives.
Usually not. Section 27 of the Contract Act 1872 voids agreements in restraint of trade, with narrow exceptions, and Pakistani courts apply it robustly. During the term of a contract, exclusivity and non-solicitation can often be structured to work; a post-termination non-compete is where drafting ambition meets section 27.
Parties to a genuinely cross-border contract can generally choose a foreign governing law, and Pakistani forums have given effect to such choices. The sharper question is forum: a foreign court judgment is enforceable in Pakistan only through limited routes, while foreign arbitral awards travel under the 2011 Act. For cross-border deals we usually pair the chosen law with arbitration.
Within limits. Section 74 of the Contract Act 1872 entitles the innocent party to reasonable compensation not exceeding the amount named, whether the clause is called liquidated damages or penalty. So the clause sets a ceiling and eases proof; it does not guarantee the number. We draft them with a genuine pre-estimate and a record of how it was reached.
The commercial spine — subscription term, renewal, suspension and fee mechanics — plus the parts foreign templates get wrong here: taxes and withholding on payments, data commitments you can keep, a dispute clause that is actually enforceable, and stamping and signature mechanics under local law. For enterprise customers, expect to negotiate security and liability schedules rather than impose click-through terms.
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Prepared by The First Counsel · As of 2026-07-12 · Pending professional review — statements flagged in the text are being verified
This publication is provided for general information only. It is not legal advice, and neither reading it nor corresponding with the firm about it creates a lawyer–client relationship. The position stated must be verified against current law before it is relied upon.