Commercial Agreements: Drafting, negotiating and reviewing
Ensure your commercial agreements protect your interests
Commercial contracts are private agreements between one or more parties for the purpose of creating rights and obligations for all involved.
They fulfill the function of guaranteeing and complying with the agreed conditions. These agreements can be with customers, suppliers, partners and other interested parties, and allow transactions, business and all kinds of operations to be delivered.
The first thing to do when drafting or revising a commercial agreement is to be clear about the services to be provided under the contract. This will frame the document in one of the following forms and purposes:
- Agency Contract
- Distribution Agreement
- Confidentiality Agreement
- Lease Agreement
- Partnership Agreement
- Sale and purchase Agreement
- Franchise Agreement
- Leasing Agreement
- Service Provider Contract
- Guarantee Contract
- Loan and Credit Agreement
- Terms and Conditions
Once this has been defined, the team at Lexidy LegalTech Boutique will know which standard clauses to include and how to draft them according to the preferences and interests of our client. Importantly, the client will always have the last word and final decision on contractual matters.
What are the requirements?
To engage into a valid commercial agreement, the signatory parties must ensure that the following are met:
- Consent must be given by both parties.
- Both parties must have the legal capacity to exercise their rights.
- The type of performance must be lawful and in accordance with the law.
Process of getting a Commercial Agreement
Every commercial agreement is different and the approach is flexible but generally speaking it follows the below steps.
- Meet with the client to understand and clarify the contract’s purpose and the services to be provided.
- We create a first draft that is algined with the client’s intersts and respects current legislation. The exact form depends on the client’s position in the contractual relationship.
- The first draft is presented to the client, who may suggest modifications and/or additions they would like included.
- If necessary, we will assist or even represent the client in any negotiations regarding te contract with the other parties. This will continue until the final version of the document is produced.
How can a lawyer help me?
Contracts are important in commercial matters. They are a written document that reflects the obligations and responsibilities assumed by each of the parties involved. It is essential that the agreements are drafted in a clear and logical manner so that there are no doubts about the terms and conditions.
On the other hand, many contracts have a specific framework and therefore specific clauses must be included and terms or provisions must be considered, like INCOTERMS in transport or supply contracts. There’s also the contractual consideration given to time, quantity or indemnity limits.
Moreover, drafting a commercial contract is usually not a task reserved for just one party: often there is a negotiation process in which different versions are drafted, according to the preferences of each signatory.
At Lexidy, our corporate lawyers have the technical and legal knowledge to prepare this type of document, in accordance with the necessary standards and, of course, with the client’s best interest as the reference point.
A lawyer will be the appropriate professional to support the client’s claims during a negotiation process and will have the legal expertise to answer, and if necessary rebuff, the opposing party’s amendments.
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Frequently Asked Questions
You should never sign a contract without having a lawyer reading it first. It’s unlikely you will have in-depth specialist knowledge of the contract or the country where it applies. It is much better to have the help of a professional.
Terms and conditions that are found on the Internet are very general and are not adapted to the specific services of any specific person. Much less, they are very unlikely cover all the possible scenarios that your business may face.
We would always always recommend the counsel of a legal expert.
Spanish law provides for the following contractual remedies:
- Unilateral termination of the contract if the breach is essential to the contract and is intentionally breached.
- Remedies of imposed conduct. For example, in consumer sales this incldues repairs and replacements.
- Remedies of money, such as damages or price reduction.
- Remedies of ineffectiveness, even if it’s temporary.
With damages, usually there is a payment of a sum of money that’s sufficient enough to compensate the injured party for breach of contract.
The amount of compensation depends on the lost incurred during the breach of contract or the time taken to restore the situation to normal.
In the event of breach of contract and termination of the contract, both the expenses incurred and even, sometimes, the profit that was lost, are considered as damages and are fully recoverable.