General terms and conditions through website allowed
On June 2, 2023, the Dutch Supreme Court issued a judgment in a case with important implications for the applicability of general terms and conditions (“GTC”). The Supreme Court ruled that wholesale companies should also be considered providers of services within the meaning of relevant EU law.
This is important because service providers may summarily suffice with a reference to their website where the GTC can be easily accessed. This will make it more difficult to annul the GTCs of wholesalers. In this article, I explain why this may be relevant to you as well.
Importance of GTC
Providing the text of applicable T&Cs properly, before or at the conclusion of a contract is very important. GTC contain elements of common agreements. For example, they contain agreements on limiting liability, when payment is due and what happens if payment is not made on time.
Good GTC also really make a difference. Rules in the GTC are often as binding as core clauses. In our practice, we regularly see how big the difference can be. Sometimes the success of an appeal to the GTC is a matter of up or under for a claim of tens, if not hundreds, of thousands of euros. Thus, if the GTC are annulled, it can also be devastating for the chances of a case.
Working with AV is logical and commonplace. It would be impractical to make all the different agreements with all customers and even less so to implement them all neatly. Consequently, many companies rely on their AV for their daily operations.
Case of the judgment
This is also the case for the company in the case that is the subject of the Supreme Court ruling. The case involves a meat wholesaler. Among other things, that wholesaler imported frozen hare offal from Argentina. One of its customers refused to pay invoices because it claimed that it later found out that the offal was contaminated with salmonella, among other things.
The wholesale company invoked a complaint period in the case, a provision in its general terms and conditions based on which the customer was obliged to examine the goods (or have them examined) within 2 days. Such a short period is, in my opinion, well defensible given the perishability of the goods delivered and the risk of subsequent contamination.
The wholesaler claimed payment of its invoices in this case. Those invoices also contained the following reference: “All transactions are subject to our general terms and conditions of sale, which You can view on our [website].”
The customer had annulled the GTC because they had not been provided in the manner stipulated in Article 6:234 of the Dutch Civil Code. To be able to speak of the provision of GTC as referred to in article 6:234 BW, certain requirements apply. Simply having the GTC on the website is not enough. For service providers, the more lenient requirements of Section 6:230c of the DCC apply.
The district court and court of appeal both ruled that the wholesaler was not a service provider and that the stricter requirements of 6:234 of the Civil Code therefore applied to the handover. The wholesaler had not complied with this, and so the district court and the court of appeal ruled that the GTC had been rightly annulled. The Supreme Court chose differently
The concept of service in the EU
The Supreme Court ruled that the wholesaler was a provider of services, and that the district court and the court of appeal had therefore applied the wrong standard. This was because previous rulings by the Court of Justice of the European Union had already shown that the term “service” in EU rules encompassed much more than what is meant by services in normal speech. The 2018 Appingedam judgment of the CJEU already ruled that retail trade in shoes and clothing was a service within the meaning of relevant EU law.
Article 4, introductory phrase and point 1 of the Directive 2006/123/EC of the European Parliament and of the Council of 12 December 2006 on services in the internal market, OJ 2006, L 376/36. (the “Services Directive“) defines a service as “any self-employed economic activity normally provided for remuneration within the meaning of Article 50 EC Treaty [now Article 57 TFEU].”
Art. 57 TFEU states that services are considered to be those normally provided for remuneration, insofar as they are not subject to the provisions on the free movement of goods, capital and persons. This is very broad, much broader than what is meant by services in ordinary language.
Handing out, for service providers easier
The Supreme Court also provided further clarification in the ruling on how offering the general terms and conditions online on the website should be considered sufficient. It ruled that for service providers, “If the general terms and conditions can be found without significant effort on or through the website referred to on the invoices, it must be assumed that the general terms and conditions are readily accessible electronically.”
This hurdle is considerably easier to overcome than how the GTC must be handed over on the basis of the “normal” Section 6:234 of the Dutch Civil Code. Now the question is whether that article still qualifies as normal, now that also the selling of goods in wholesale and retail must be considered a service. The exception of Section 6:230c of the Civil Code for service providers is likely to apply more frequently.
Nevertheless, it remains safer not only to post the GTC on the website, but also to provide it to customers in line with article 6:234 of the Civil Code. In this way, the fact that the GTC have been provided is easier to prove. It sometimes happens in our practice that the link to the GTC of a client or the opposing party does not work, for example because the URL has changed. If that is the case, you will still be without them, with all the attendant consequences.
Questions? Get in touch
Do you have any questions? With our knowledge, we can give you good and targeted advice to avoid potential pitfalls. You can reach us by mail, phone, or via the contact form at the bottom of this page. We will be happy to think along with you.