In brief
B2B relationships, particularly in the retail sector, are often characterized by an economic imbalance between the contracting parties, resulting in one party being able to impose contractual terms that would not be possible under normal market circumstances. Therefore, on 21 March 2019, the Belgian Parliament passed a new act on the abuse of economic dependence, unfair terms and unfair practices in B2B relationships (the ‘Act’).
With regard to abusive clause, this Act introduces:
- A general prohibition for companies to insert unfair clauses in their contracts with other companies. Whilst the unfair character of a clause must be assessed on a case-by-case basis, it is, in principle, meant to include any clause that creates, alone or in conjunction with other clauses, a clear imbalance between the rights and obligations of the parties.
- A black list of clauses, which are considered unfair and prohibited in all cases without the need for any further evaluation; this list notably includes potestative clauses, clauses giving a party the unilateral right to interpret any clause of the contract, clauses whereby one party must waive any remedy against the other in case of dispute (which may, in certain cases, include arbitration clause), etc.
- A grey list of clauses, which are presumed to be unfair unless proven otherwise; this list notably includes clauses authorizing a party to unilaterally change the price or other terms of the contract without a valid reason, limit the means of evidence that a party may use, clause providing excessive damage in the event of non-performance or delay in the performance of a party’s obligations, etc.
Sanctions. The unfair clause will be considered as null and void but the contract itself will remain binding upon the parties, provided it can continue to exist without the clause. In addition, interested parties may claim financial compensation in case they suffered damage related to the clause. Lastly, under certain conditions (such as bad faith), criminal sanctions could also be imposed.
Scope of application and entering into force. These new rules will apply to any agreement entered into, renewed, extended or amended as from 1 December 2020. Financial services or public procurement contracts are however expressly excluded from the application scope of the Act.
In addition, those rules qualifying as ‘overriding mandatory provisions’ pursuant to Article 9 of the Rome I Regulation, it must be noted that they will apply to all contracts performed in Belgium, this notably irrespective of the parties’ localisation or of any ‘choice of law’ clause in favour of the laws of another jurisdiction.
