General terms and conditions: why they make sense

You do not have to draw up general terms and conditions, but they can save you a lot of trouble. General terms and conditions set out the rules you have for doing business. For example, whether your quotation is binding. And your delivery time. You can refer to them, should you have a difference of opinion with a customer or client. But there is more to it than drawing up a set of rules. Read what you can and cannot include in your general terms and conditions, and how you use them correctly.

Jaap van der Meulen provides customer service for several clients with his company Chatkracht. He can relate to the importance of general terms and conditions. “A large webshop asked for our support during a campaign. A huge assignment, for which I had to hire 25 extra people. The client's condition was that we would use their software.” In the first week of the campaign, things went badly wrong. “The software didn't work. Fortunately, I have included this kind of contingency in my general terms and conditions. If something happens beyond our control, such as a software failure like this, Chatkracht still gets paid. After all, I still have to pay the people I hired.” Thanks to Van der Meulen's clear agreements set down in writing, he was able to avoid further problems.

Drawing up general terms and conditions

What exactly you put in your general terms and conditions depends on the work you do. Many sector organisations have drawn up their own general terms and conditions. If you are a member, you can use those as a basis. Some sector organisations require members to use the organisation's own general terms and conditions. Insurers sometimes also require you to include certain things in your general terms and conditions. If you have business liability insurance, for example.

Almost all general terms and conditions contain rules about:

  • Quotation: how long is it valid?
  • Transport: who pays for transport, insurance, and import duties?
  • Delivery time: how long is the delivery time and when does force majeure apply? (Force majeure is a term used to describe unforeseeable circumstances that prevent someone from fulfilling a contract. For example, natural disasters or a pandemic).
  • Payment: what is the payment term and what about collection costs and interest for late payments?
  • Retention of title: if the customer does not pay, the seller retains ownership of the product and can therefore reclaim it.
  • Warranty: is there a warranty and if so, what are the conditions
  • Difference of opinion: how to deal with a dispute?
  • Liability: who is responsible for damage if you or your customer makes a mistake?

Include the most important agreements and those specific to a particular assignment In the quotation or contract. This prevents disputes. 
Take note: If you do business internationally, draw up the general terms and conditions and the contract in the same language.

Drawing up terms and conditions yourself

You can also draw up your own general terms and conditions. Many entrepreneurs use the terms and conditions of other companies in their sector as an example. Make sure not to directly copy another company’s general terms and conditions. This is not allowed because of copyright. Other entrepreneurs' terms and conditions may also contain things that are not relevant to you. Or there may be important subjects missing.

If you want to be sure your terms and conditions are correct, ask a lawyer to draw them up or check them. 

Unreasonable terms and conditions

You may not include any agreements in your general terms and conditions that are unreasonable. There is also no point in doing so because unreasonable terms and conditions are not legally valid. You can check what the law considers unreasonable on the blacklist in the Civil Code (in Dutch). This is a list of agreements prohibited in general terms and conditions between companies and consumers. The blacklist says, among other things, that you cannot stipulate that customers can only undo the purchase through the courts. There is also a grey list (in Dutch). On this list you will find borderline cases. For example, that as a business owner, you are not liable in case of damage. If a condition on the grey list is unreasonable in your case depends on your situation and business.

The black and grey lists only apply for consumers but of course you must also comply with the law for business customers. Small entrepreneurs, such as sole traders, general partnerships, or small private limited companies, are in some cases protected by the ‘reflex effect’. This means that consumer rules apply to a small entrepreneur.

Consumer or business customer

The law protects consumers better than business customers. You can expect business customers to be better informed about their rights and obligations than consumers. If you work with both businesses and consumers, it is useful to create a different general terms and conditions document for each group. 

Using general terms and conditions

Using good terms and conditions can save you time and trouble, but you do have some obligations:

  • Your general terms and conditions must be public.
  • Your customer or business partner must agree to your general terms and conditions before or during the conclusion of the contract.

If you do not comply with these requirements, the general terms and conditions do not apply. The contract you concluded is valid, but your general terms and conditions are not.

KVK adviser Albert Koerts regularly speaks to entrepreneurs who have a dispute with a customer. “My first question always is whether the entrepreneur has communicated their general terms and conditions to the customer. Usually, the answer is no. So then they don't have a leg to stand on.”

Written or oral

You can send the general terms and conditions to your customer or attach them to the contract or quotation. In that case, do refer to the general terms and conditions in the contract or quotation so that your client does not overlook them. Do you often work for the same client? Then it is enough to send the general terms and conditions with the first assignment. Do include a text such as: ‘All our transactions are subject to the general terms and conditions as provided to you. You can always ask for a new copy to be sent to you.’

Annetta Hoekstra-Bootsma has her own child and family coaching practice, Jongbrein. She also sells parenting-related products online, such as reward posters. “I always send my terms and conditions to my clients and ask them to read them carefully. Occasionally, it happens that clients disagree with paying travel costs, for example. Or a customer returns a product that has been opened and damaged so that I can no longer sell it. Then it is good to be able to refer to the general terms and conditions, that helps prevent disputes.”

Sometimes it is not possible to send your terms and conditions in advance or during the agreement. For example, because you do business over the phone. In that case, before the agreement is concluded you must agree:

  • That you have general terms and conditions.
  • Where your customer can view them.
  • that you will send the general terms and conditions free of charge if the customer wants them.

Online agreements

For online contracts, you must also notify in advance that general terms and conditions apply. You can do this in various ways:

  • Enclose them with your offer or quotation.
  • Put them on your website as a PDF. On the product pages, with your offer, or in the order form.

Customers must be able to download your general terms and conditions. Want to make sure your customer is aware of your general terms and conditions? Have them check a box during the ordering process to indicate they agree to your terms and conditions.

Exception for service providers

There is an exception for service providers. They may also make their general terms and conditions available by referring to their website. However, the general terms and conditions must be easy to find on that website. The most convenient way is to refer your customers to the page where the general terms and conditions can be found, such as www.nameofcompany.nl/termsandconditions. Legally, service providers are defined as parties that ‘normally perform economic activities for remuneration outside employment’. Examples of service providers include lawyers, travel agencies, accountants, and ICT service providers.

Filing general terms and conditions

You can also file your terms and conditions with KVK or the court. Filing general terms and conditions | KVK Your customers and business partners can then request the general terms and conditions there. Filing them can be especially useful in situations where you cannot send your general terms and conditions to your customers, such as in telephone sales. 

Do you still have questions about what you can put in your general terms and conditions? Or about how to use them? Contact the KVK Advice Team: 088 585 22 22.