20 May A revolution in B2B contracts

On 21 March 2019, Parliament adopted a new piece of legislation subjecting business-to-business (B2B) contracts to restrictions similar to those already applying to consumers (B2C). This new piece of legislation will have a significant impact on business relationships. B2B conventions and interactions will from now on be more closely monitored.

In order to tackle abusive behavior in unbalanced B2B relationships, abuse of a relation of economic dependency has been made henceforth punishable by law. The legislator provides examples for this, among which providing economic partners with the same services, but under very distinct conditions. The provisions relating to the abuse of economic dependency will enter into force 1 year after the forthcoming publication of the law in the Belgian Official Gazette.

The legislator has also decided to introduce a system of unfair terms in B2B transactions. From now on, any clause in a contract between companies is deemed to be unfair when it creates a clear imbalance between the rights and obligations of the parties.

In addition to this general definition, the law contains a « black list » of four terms deemed to be unfair in any circumstance (in particular, the provision of an irrevocable commitment by one of the parties, while the performance of the other party’s services hangs solely on its will).

A « grey list » of eight presumed (unless proven otherwise) unfair terms has also been drawn up. Examples include: the possibility of having a fixed-term contract tacitly renewed without prior specification of a reasonable period of notice of termination; or exonerating a company beforehand from any liability for willful misconduct, gross negligence or misconduct on the part of any of its employees.

These provisions will apply 18 months after the publication of the law, to new contracts as well as to contracts renewed after that date.

Finally, much of the regulation on unfair, misleading and aggressive market practices in consumer contracts has been extended to B2B relationships. These provisions relating to market practices will be applicable 3 months after the publication of the law in the Belgian Official Gazette.

For more information on this topic, please feel free to contact Guillaume RUE (guillaume.rue@cairnlegal.be).

Best regards,

The Cairn Legal team.