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WARRANTIES IN SUPPLY CONTRACTS: AN INTERNATIONAL PERSPECTIVE

When it comes to negotiating the provision of products and services, whether you are a supplier or a buyer, you will try to limit your responsibility and also secure the most comprehensive warranties.

Belgian lawyers, for example, negotiate a contract by referring to Belgian legal principles pertaining to responsibility or warranty. However, in international contracts, what remains of these principles when the contract cannot be subject to domestic law?

This was the question posed in a high-profile seminar hosted by CMS in Brussels in conjunction with Belgium’s Association of In-House Counsel.

The event, which was so oversubscribed we had to repeat it soon afterwards in Antwerp, gave in-house counsel an overview of the warranty regimes in Belgium’s neighbouring legal systems. CMS lawyers from France, Germany, the Netherlands, Switzerland and the UK attended to provide in-house counsel with the key points to bear in mind when concluding international contracts.

CMS Brussels partner Renaud Dupont said, “The issue of warranties in international supply contracts is significant because there is no harmonisation of these laws in Europe. If contracts are subsequently litigated in different countries, then it is crucial that clients are protected by the terms of the jurisdiction clauses in the original drafting.

Our events proved to be extremely popular with in-house counsel and they seemed to appreciate the practical yet international tone of the discussion.
Renaud Dupont, Partner, CMS Brussels

The events were based on the CMS Guide on Warranties in Supply Contracts which illustrates the legal conditions for supply agreements in several European countries.

The guide deals with supply contracts between companies and, in certain cases, the country chapters refer to specific provisions applicable to consumers. These chapters also address relevant national laws. The United Nations Convention on Contracts for the International Sale of Goods (CISG) often applies to international supply contracts, however, and the guide contains a separate chapter which summarises the main aspects of the CISG.

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