International software project disputes are conflicts regarding IT projects between client and supplier in different countries — concerning scope, deadlines, quality, or payment. At Musch Legal, we regularly handle IT disputes regarding ERP implementations, SaaS platforms, and custom development. Figures show: 40-60 percent of large IT projects run over schedule; 25 percent fail completely. Clear contracts and structured dispute resolution significantly limit damage.
What is the legal problem? (What software disputes arise?)
Software disputes range from scope creep, late delivery, defects, performance issues, and security incidents to termination disputes. For Dutch clients with international suppliers (often India, Poland, Ukraine): jurisdiction and choice-of-law clauses are crucial. Standard contracts such as NLdigital provide suppliers with extensive protection through limitations of liability. For clients: renegotiation crucial for critical projects.
What does the law say? (Which frameworks apply to IT?)
Under Dutch law, Articles 7:400-7:445 BW (contract for services), Article 7:758 BW (contract for work if custom development). For SaaS: often a hybrid contract-lease-license. For digital products, Directive 2019/770 and the Act implementing directives on the sale of goods and delivery of digital content since 27 April 2022 (Articles 7:50aa et seq. BW). For B2B: TTBER (Regulation 316/2014) for licenses. For security: NIS2 (Directive 2022/2555) and Cyber Resilience Act (Regulation 2024/2847). For data: GDPR.
For source code escrow: Article 254 of the Dutch Code of Civil Procedure for release by default supplier.
Type of dispute
Main cause
Approach
Scope creep
Unclear specifications
Activate change control
Late delivery
Underestimation + breakdowns
Notice of default, Article 6:82 of the Dutch Civil Code
Defects
Bugs, performance, integration
Acceptance test, hold-back
Security incident
Data breach or cyber attack
GDPR + cyber policy
Termination dispute
Breach of contract or convenience
Cure period + exit data
Type of dispute
Main cause
Approach
Scope creep
Unclear specifications
Activate change control
Late delivery
Underestimation + breakdowns
Notice of default under Article 6:82 of the Dutch Civil Code
Defects
Bugs, performance, integration
Acceptance testing, hold-back
Security incident
Data breach or cyberattack
GDPR + cyber policy
Termination dispute
Breach of contract or convenience
Cure period + exit data
What risks do companies face? (What threatens in the event of IT failure?)
Lost investments often millions, business operations can grind to a halt. For public organizations: political damage and procurement problems. For suppliers: reputational damage and fines. Supplier terms and conditions often limit liability to 6-12 months' compensation — minimal versus actual damages. Source code access difficult without escrow. For SaaS: data portability at exit is crucial.
Practical example from our practice (How do we save a 4 million euro ERP project?)
Musch Legal represented a Dutch logistics company whose 18-month ERP implementation by an Indian supplier had run over schedule by 9 months, resulting in a 4 million euro budget overrun. We conducted a structured escalation: notice of default under Article 6:82 of the Dutch Civil Code, expert report on defects, suspension of payment under Article 6:262 of the Dutch Civil Code. NAI arbitration (chosen via dispute resolution clause): supplier ordered to complete the project without additional payment plus 1.2 million euros in damages. The project was successfully completed after all; the client saved an estimated 6 million euros compared to the replacement process.
What can you do? (Which IT dispute strategy are you building?)
Negotiate a strong contract with clear acceptance criteria, scope management, SLAs with penalties, source code escrow, and an exit data clause. Formally implement change control. Document all changes and defects. Conduct acceptance tests with clear criteria. In case of problems: early escalation via a formal notice of default. Choose arbitration with IT experts (NAI, ICC). Source code escrow with Escrow Europe or NCC Group. Engage Musch Legal for IT disputes.
Disputes regarding AI solutions