General terms and conditions of purchase and sale
You have your collection made by a workshop in Porto and sell it to forty shops in the Netherlands, Belgium and Germany. You want the manufacturer to deliver what you approved, in time for the season, and you want the shops to pay or else give your clothes back. Those are two sets of arrangements with two kinds of party. Each asks something different of your terms and conditions.
General terms and conditions of purchase and sale are the standard clauses a business uses with its suppliers (terms of purchase) and with its customers (terms of sale), such as delivery periods, payment, deadlines for complaints, liability and retention of title.
A template from the internet rarely covers what goes on in fashion, design or manufacturing. Think of a collection that moves with the season and designs that have to stay yours, with customers and manufacturers abroad.
Need terms and conditions drafted, or a customer’s purchasing terms reviewed? Call 020 675 88 21 or get in touch. You will have a reply within one working day.
What belongs in your terms of sale for customers
Terms of sale are written for the party that buys from you: the boutique, the department store, the distributor. Payment is at their heart. Set the payment period and what happens once it has passed. Include a retention of title clause as well, so that unpaid clothes stay yours until the invoice has been settled.
Then comes delivery. A winter coat no longer sells in February, so a shop will want a final delivery date. Set out when a delivery counts as late and what the customer may then do: cancel, ask for a discount or simply wait. Agree too how quickly the shop has to report that a delivery is not right. The law only says that the buyer has to complain within a reasonable time after discovering the problem (Article 7:23(1) of the Dutch Civil Code). A specific period in your terms prevents an argument about what counts as reasonable.
Don’t forget the images. A shop will want to use your campaign photos and product copy in its own webshop and on Instagram. Provide that it may do so for as long as it sells your collection, and that it stops afterwards. Finally, limit your liability to the value of the delivery, with an exception for intent and deliberate recklessness, because a court will almost never uphold a limitation that also covers those cases.
More about retention of title →
Terms of purchase for your manufacturer or workshop
When you buy, the roles are reversed. Now you are the one who wants certainty that you get what you ordered. Record that production matches the approved sample and the specifications for fabric, sizing and finish, and what happens to a batch that departs from them.
Late delivery by a manufacturer costs you a season. A penalty for every day of delay and the right to cancel after a final date are customary in terms of purchase. A penalty like that puts pressure on the manufacturer to give your order priority.
The most important part concerns what you show the manufacturer. Designs, patterns, moulds and technical drawings remain yours. Set out that the manufacturer uses them only for your orders, does not show them to anyone else and returns them at the end. Agree in writing as well that whatever the manufacturer adds to your design becomes yours. Read more about protecting a clothing design and assigning copyright.
Whose terms apply when your customer refers to its own
If a department store sends an order referring to its purchasing terms and you confirm it referring to your terms of sale, the terms mentioned first apply in principle. The second reference only works if it expressly rejects the first set (Article 6:225(3) of the Dutch Civil Code). The advantage often lies with whoever writes first. So a quotation or price list that refers to your own terms, sent before the order comes in, is worth the effort.
When a court sets aside a clause in your terms and conditions
The other party can have a clause annulled if, in all the circumstances, it is unreasonably onerous (Article 6:233(a) of the Dutch Civil Code). Not every other party has that option. A legal entity that has published its annual accounts does not have it, and nor does a business employing fifty people or more. They also cannot rely on terms not having been provided to them (Article 6:235(1)). So a large retail chain cannot brush your terms of sale aside on that ground.
The same applies to you the other way round, even if you are a small label. If your private limited company (bv) has filed its annual accounts, you cannot have a department store’s purchasing terms annulled because they are unreasonably onerous. All that remains is the general test: a clause does not apply to the extent that applying it would, in the circumstances, be unacceptable by the standards of reasonableness and fairness (Article 6:248(2)). That bar is high. So read a large customer’s purchasing terms before you confirm the first order, rather than only once there is a problem.
Terms and conditions in international purchasing and sales
If your manufacturer or customer is based outside the Netherlands, the Dutch rules on general terms and conditions do not apply. That remains so if you have declared Dutch law applicable to the contract (Article 6:247(2) of the Dutch Civil Code, in Dutch). With the workshop in Porto and the customer in Antwerp, you therefore cannot have a clause annulled because it is unreasonably onerous or because you did not receive the terms in time (Articles 6:233 and 6:234). Nor can they do so against you.
Where goods are sold between businesses in different contracting states, the UN Convention on Contracts for the International Sale of Goods (CISG) applies as well (Article 1), unless you exclude it (Article 6). The convention has its own rules on how a sale is concluded. An order confirmation with different terms on price, payment, delivery or liability does not count as acceptance under the CISG but as a counter-offer (Article 19). Across borders, the rule that the terms mentioned first prevail does not simply work. So write your terms for customers and manufacturers abroad in English, with a choice of law and a choice of court, and decide deliberately whether or not you want the CISG to apply.
Webshop terms for consumers are a separate set
If you also sell direct to consumers, your webshop needs a set of terms and conditions of its own. Different rules apply to consumers, such as fourteen days to change their mind and information you have to give before the order is placed. E-commerce law explains what that involves. Keep the two sets apart. A business customer needs different arrangements from someone ordering a coat.
A lawyer for your terms and conditions of purchase and sale
We at Liaise find that brands and designers often have a single set of terms, once written for the webshop and since then applied to shops and manufacturers as well. We draft terms and conditions of purchase and sale that fit the way you produce and deliver, in English and Dutch. If a department store or distributor puts its purchasing terms in front of you, we read them before you sign and tell you which clauses to push back on.
Want your terms and conditions drafted, or a customer’s terms reviewed? Get in touch or call 020 675 88 21.
