When you’re putting together General Terms and Conditions it’s important to keep your business needs in mind. The purpose of the general terms and conditions is to reduce your risk as much as possible. While there are lots of terms you can include, consider some of the following:
- Are there going to be consequences for late payment or nonpayment?
- What happens if you’re late delivering product or services?
- What happens if a customer/client is dissatisfied?
- Can refunds be requested? Under what circumstances?
- Is it possible to renegotiate elements of the contract?
- If the contract is broken, what actions will be taken?
These are a good place to start, but it’s important to remember that there are limits to what you can include. Depending on your business needs, local laws, or the local laws of your business partner, certain provisions aren’t allowed. Some might even classify as ‘unreasonable’ and will not be recognised by a court in case of a dispute. This is especially true if your process includes consumers, as there are more consumer protections in EU countries than in the US.
Black and Grey List General Conditions
Depending on the location of your business partner, certain provisions are not permitted or recognised in general terms and conditions. These are called ‘Black List’ conditions. These provisions usually deprive a client or customer of statutory powers and are legally considered unreasonable. In addition to the black list, there is also a ‘gray’ list of rules that, while not necessarily illegal, can be dismissed as unreasonable, or harm your case in a dispute.
Some conditions that won’t be considered valid by a court in the EU include:
- An invoice limitation period of less than 1 year
- The amount can be increased unilaterally, and the counterparty can’t contest the change
- You cannot decide unilaterally whether one party has satisfied the agreement or not
- A web store can’t claim they’re no longer responsible for a package just because they have given it to a delivery service
- A tacit renewal without a notice period of more than one month
Remember, this is just a partial list. It’s very important to do your research before putting together your company’s General Terms and Conditions.
If you want more information on General Terms and Conditions or are looking for legal advice, contact us. We’re passionate about smart, ethical business practices and want to help you!