Structuring Multi-national Outsourcing Contracts

Outsourcing is increasingly used to help consolidate global businesses, either as part of routine streamlining or after mergers, acquisitions or divestments. By outsourcing on a multi-country basis, businesses can achieve a higher degree of standardisation. However, the outsourcing arrangements must provide for local variations, while ensuring that these operate within the confines of the global deal. Multinational companies use a variety of outsourcing arrangements to achieve this aim. This Alert examines the main contractual structures used in multi-jurisdictional outsourcings and the key issues that arise in such projects.

Multi-country outsourcing occurs where the outsourcing takes place over a number of jurisdictions, outsourcing the services in each jurisdiction to a local supplier or, in some cases, to a shared services centre. The key distinguishing feature of such deals is the complex network of contractual and service delivery relationships.