Beware of unfair clauses in your B2B contracts!

For business-to-business contracts concluded, renewed or amended as from 1 December 2020, stringent contract drafting requirements will apply in Belgium. This applies to your online and offline contracts. To avoid that one or more contractual clauses would be deemed “unfair” and therefore null and void, your B2B contracts will need close scrutiny.

With effect as from 1 December 2020, companies will need to have reviewed their B2B agreements, both online and offline. In April 2019 the Belgian legislator adopted an act aiming to protect companies with regard to their B2B relationships, much to the example of what exists for example in Germany already for several years.

One of those protective measures relates to agreements concluded between companies (“B2B agreements”), and more in particular the sanctioning of clauses in B2B agreements which are considered “unfair”.

Unfair in this context means that the contractual clause (alone or jointly with others) creates a material imbalance between the two (or more) professional parties.

A similar set of rules applies to B2C contracts already for many years, and the Belgian legislator has opted to apply a similar (though more limited) set to B2B agreements.

Much like its B2C counterpart, several types of clauses are automatically considered unfair (e.g. a unilateral right to interpret the agreement, etc.) whilst other types of clauses are “deemed” to be unfair bar proof to the contrary (e.g. a unilateral right to amend the agreement, certain liability limitations, etc.).

To consider whether a B2B clause is (un)fair, the act clarifies that the surrounding circumstances between the parties should be taken into account. This seems to indicate that the economic/bargaining position of a company vis-à-vis the other will be a relevant factor in this assessment. However, this will also lead to a level of uncertainty as concrete circumstances vary in each case.

In any event, a clause determined unfair shall be considered null and void (hence not applicable), but the act clearly stipulates that the (remaining) clauses of the contract continue to be binding between the parties.

Great care is thus to be advised! For example, in case a liability clause would be declared null and void, the company having limited its liability through the unfair clause, will suddenly be faced with an open-ended liability under common law. It remains to be seen to which extent judges will be prepared to apply “severability” clauses which are common in B2B agreements and which might remedy an “unfair clause” sanction to some extent.

For more information, please contact Antoon Dierick. MDP lawyers can assist you with any type of online and offline contractual work.