This Precedent is a governing law clause, sometimes known as an applicable law clause or a choice of law clause. The governing law clause is categorised as one of the boilerplate clauses of an agreement. It allows the parties to specify the substantive law that will apply to the interpretation of an agreement and, in the event of a dispute, in relation to it.

A governing law clause does not make provision as to how such disputes are to be resolved. Merely choosing Irish law as the proper law of the agreement does not automatically operate as a submission to the jurisdiction of the Irish courts. It is important to note that governing law and jurisdiction are separate issues. For further information on jurisdiction clauses, see Precedent: Ireland—Jurisdiction clause.

It is important that a governing law clause is considered, particularly if the contract in question has an international element. An applicable law clause should make provision for a national system of law to be applied to determine the dispute between the parties. Generally, the parties have the freedom