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Which risks do I cover with my general terms and conditions?

With good general terms and conditions, you cover a significant number of business risks: non-payment, liability, force majeure, ownership of delivered goods, and disputes. They therefore constitute one of the cheapest forms of risk management for your company. Risk of non-payment...

Published on April 20, 2020 by MKBjuristen.nl
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With good general terms and conditions, you cover a substantial number of business risks: non-payment, liability, force majeure, ownership of delivered goods, and disputes. They therefore constitute one of the most cost-effective forms of risk management for your company.

Risk of non-payment

In your terms and conditions, you set out payment terms, as well as the consequences of late payment: statutory (commercial) interest, collection costs, and the option to suspend delivery in the event of non-payment. This reduces the risk of an unpaid invoice remaining unpaid.

Liability risk

If something goes wrong, you do not want to be liable without limit. In your terms and conditions, you limit liability within legal limits, for example to the invoice amount or the insured sum, and exclude indirect damage. However, limits apply to consumers.

Force majeure and delivery

With a force majeure clause, you regulate what happens if you are unable to deliver due to circumstances beyond your control. And with a retention of title clause, delivered goods remain your property until they are paid for in full — important protection in the event of your customer's bankruptcy.

Disputes, IP and more

You also determine which law and court apply, how to handle complaints and deadlines, and how to protect your intellectual property. The better your terms align with your business, the more risk you cover.

Frequently Asked Questions

Which risk do I cover the most with general terms and conditions?

Particularly the risk of payment and liability, but also force majeure, retention of title, and disputes.

Do general terms and conditions protect against everything?

No. They limit risks within legal limits; additional restrictions apply to consumers. Combine them with good contracts and insurance.

Do the terms and conditions need to suit my company?

Yes. Standard terms and conditions often cover exactly the wrong risks. Customization aligns with your industry, customers, and working methods.

Cover your risks with strong conditions?

Our legal experts draft custom terms and conditions and perform a terms and conditions scan . View our contract law team or schedule a free consultation .

Please note: an article provides general information, but your legal situation may turn out differently.

A contract, conflict, or legal risk must always be assessed based on the facts, documents, evidentiary position, and interests. Are you in doubt? Have your situation assessed before you act.

Legal question regarding this article?

A blog provides explanation, but your situation often requires a concrete legal choice. MKB Juristen helps entrepreneurs with contracts, terms and conditions, GDPR documents, employment documents, disputes, and customized legal solutions.

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SME Lawyers at the Chamber of Commerce Source: Chamber of Commerce 2019
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