Terms and conditions

The following terms correspond to the non-binding recommendation governing general business conditions of the Gesamtverband Kunststoffverarbeitende Industrie e.V, issued April 29, 2002. In addition to this terms the latest version of the Incoterms are valid.

Scope

The following terms and conditions shall be applicable only to business persons, legal entities under public law or a public separate estate.

I. Application

  1. Purchase orders shall become binding only after the supplier has confirmed the order. Any alterations and amendments shall be made in writing. All offers are subject to alterations, unless they are designated as firm offers.
  2. If regular business relations are maintained, these terms shall also apply to future business transactions, even if no express reference is made to them, provided that the customer has been advised of these terms at the occasion of an earlier purchase order that has been confirmed by the supplier.
  3. Any terms and conditions of business on the part of the customer shall not be applicable, unless expressly accepted by the supplier.
  4. Should individual provisions of these general terms and conditions be or become ineffective, the remaining conditions will not be affected thereby.

II. Prices

  1. In case of doubt, prices shall be considered to be ex works, excluding freight, customs duty, ancillary import charges and packing, plus VAT at the statutory rate.
  2. Should relevant cost factors vary considerably after submission of the offer or between confirmation of the order and delivery, supplier and customer shall come to an understanding in order to adjust prices and proportions of costs for molds accordingly.
  3. If the price has been agreed to be related to the weight of parts, the final price shall be calculated by the weight of the approved type samples.
  4. In the case of new purchase orders (follow-up orders), the supplier shall not be bound to previous prices.

III. Obligation to deliver and to take delivery

  1. Delivery periods shall commence after receipt of all documentation required for the execution of the order, of down payment and timely provision of materials, if such were agreed upon. Should shipment be impossible or be delayed without any fault on the part of the supplier, the delivery time shall be considered to be adhered to upon notification of the supplier’s readiness to deliver.
  2. If an agreed delivery time is not adhered to due to a fault of the supplier, but the latter has not acted with gross negligence or intent, the customer, after lapse of a reasonable period of extension and to the exclusion of further claims, shall be entitled to claim compensation for loss occasioned by the delay or to withdraw from the contract. Compensation of loss occasioned by delay shall be limited to no more than 5% of the portion of the delivery that has not been completed in conformity with the contract. Rescission of the contract shall be excluded, if the customer, on his part, is in default of acceptance. The customer retains the right to furnish proof of higher damages.
  3. Adequate partial deliveries as well as reasonable deviations from order quantities up to plus/minus 10% shall be allowed.
  4. If blanket orders are placed without agreement of any duration, manufacturing lot sizes and acceptance dates, the supplier may demand a binding commitment as to these details three months after acknowledgement of the order at the latest. Should the customer not comply to make such commitments within three weeks, the supplier shall be entitled to grant an extension of two weeks, and, after lapse of this extension period, to withdraw from the contract and/or claim compensation.
  5. If the customer fails to duly take delivery of the item, the supplier, without prejudice to any other rights, shall not be bound by any regulations on self-help sale and rather may freely sell the delivery item on the open market after prior notification of the customer.
  6. Cases of force majeure shall authorize the supplier to delay delivery for the duration of the impediment including a reasonable start-up period, or to rescind the contract wholly or in part because of the not yet completed part of the delivery. Cases of force majeure shall include strikes, lockouts or unforeseeable and unavoidable situations, such as operational disruptions, which, notwithstanding all reasonable efforts, render in-time delivery by the supplier impossible; proof of the above is to be furnished by the supplier. The same shall also apply, if the aforementioned impediments occur during default or at the facility of a sub-supplier.The customer may request the supplier to declare within two weeks whether he wants to withdraw from the contract or wants to supply the goods within a reasonable period of extension. If the supplier does not respond to the request, the customer may rescind the remaining, not yet completed part of the contract.The supplier shall inform the customer without delay when a case of force majeure, as defined in clause 1, has occurred. The supplier shall be obliged to minimize any adverse effects on the customer as far as possible, if necessary, by handing over the molds for the duration of the impediment.

IV. Packaging, Dispatch, Passing of Risk, Default of Acceptance

  1. Unless otherwise agreed, the supplier shall choose the packaging, mode of dispatch, and shipping route.
  2. The risk shall, even in the case of carriage-paid shipments, pass to the customer upon the goods leaving the supplier premises. If shipment is delayed due to reasons for which the customer is responsible, the risk already passes to the customer when notification of readiness for dispatch is given.
  3. When requested in writing by the customer, the goods will be insured at the expense of the customer for the risk coverage requested by him.

V. Retention of title

  1. Deliveries remain the property of the supplier until all claims held by the supplier against the customer have been met; even if the purchase price for specially designated claims has been paid. With current accounts, retention of title to the delivered goods (goods subject to retention of title) is deemed to be security for the balance owed to the supplier. If, in connection with payment of the purchase price, liability of the supplier is established under a bill of exchange, the retention of title will not expire until the bill of exchange has been honored by the purchaser as the drawee.
  2. Processing or treatment of supplied goods by the customer may only be carried out on behalf of the supplier to the exclusion of acquisition of title under § 950 of the BGB (German Civil Code). The supplier becomes co-owner of the thus produced item/object in a proportion equivalent to the ratio of the net invoice value of his goods to the net invoice value of the goods to be processed, which, as goods subject to retention of title, serve to secure the claims of the supplier as per clause 1.
  3. In the event of any processing (combining/mixing) by the customer with goods not owned by the supplier, the provisions of §§ 947, 948 BGB (German Civil Code) shall apply with the consequence that the supplier’s co-owned share in the new item/object is then deemed to be goods subject to retention of title within the meaning of these present terms.
  4. 4.The customer shall only be allowed to resell goods subject to retention of title in his ordinary course of business and with the proviso that the customer also agrees on a retention of title with his customers as per clauses 1 to 3. The customer shall not be entitled to dispose of the goods subject to retention of title in other ways, in particular by pledging, chattel mortgaging, and assignment for security purposes.
  5. In the event of resale, the customer, hereby and already now, until all claims of the supplier have been met, assigns to the supplier all receivables owed to said customer and any other justified claims against the customer’s own customers including all ancillary rights which may result from the resale of the goods. At the supplier’s request, the customer has to provide the supplier immediately with any information and documentation required to assert the rights of the supplier against the customers of the customer.
  6. If goods subject to retention of title are re-sold by the customer after they have been processed in combination with other goods not owned by the supplier, as outlined in clause 2 and/or 3 above, the assignment of the purchase price claim according to clause 5 shall apply only to the amount of the invoice value of the supplier’s goods subject to retention of title.
  7. If the value of the securities existing for the supplier exceeds the latter’s total claims by more than 10%, the supplier shall be obliged, at the customer’s request, to release securities to this extent; the supplier shall decide which securities are to be released.
  8. The supplier must be notified without delay of any confiscation or seizure by a third party of goods subject to retention of title. All intervention costs incurred in this connection shall at any rate be borne by the customer unless such costs are borne by third parties.
  9. Should the supplier, taking action according to the above clauses, make use of his right to take back goods which have been delivered subject to retention of title, the supplier shall be entitled to sell such goods on the open market or to put them up for auction. Laying claim to goods subject to retention of title and, in particular, the request for return of such goods constitute a rescission of the contract. The goods subject to retention of title will be taken back at the amount of the proceeds obtained, but at no more than the agreed delivery prices. Further claims for damages, in particular compensation for loss of profit, shall remain reserved.

VI. Liability for Material Defects

  1. Relevant for the quality and condition/workmanship of the products are the type samples, which, at the customer’s request, are submitted by the supplier to the customer for examination purposes. Any reference to technical standards serve as an aid to describe the performance of the product or work performed and is not to be interpreted as a guarantee as to the quality or condition of the product or work performed.
  2. If the supplier has provided the customer with advisory services going beyond his contractual obligation, the supplier warrants the functionality and suitability of the delivery item only after prior express assurance.
  3. Defects are to be notified in writing without delay; hidden defects are to be notified immediately after detection. In either case, all claims of the customer based on defects shall become statute-barred twelve months after passing of the risk, unless otherwise agreed or unless the statutory limit of § 438 section 1 No. 2, § 479 section 1, and § 634a section 1 No. 2 of the BGB (German Civil Code) prescribes longer warranty periods as mandatory.
  4. If the notice of defects is justified – with the type samples approved in writing by the customer being the criterion for the quality and condition to be expected – the supplier shall be obliged to remedy the defects complained of. The customer shall be entitled to reduce the purchase price or rescind the contract, if the supplier does not fulfil his obligation to remedy the defects complained of within a reasonable period of time or if rectifications of defects fail repeatedly despite several attempts. Further claims, in particular claims for reimbursement of expenses or for damages due to harm or consequential harm caused by a defect shall only be allowed as provided for under the regulations of section VII. Replaced parts are to be returned to the supplier at his request and expense.
  5. Unauthorized reworking and improper treatment or handling of defective parts shall result in the loss of any right to claim for compensation due to defects. Only in order to avoid disproportionately large damage or if the supplier fails to remove the defects on time, shall the customer be entitled, after prior consultation with the supplier, to remedy the defects and to demand compensation for appropriate costs.
  6. Normal wear and tear caused by usage according to contract shall not imply any rights to make warranty claims.
  7. Claims under a right of recourse according to §§ 478, 479 of the BGB (German Civil Code) shall exist only if the claim by the consumer was justified and only to the extent provided by law, but they shall not exist for good will provisions not agreed upon with the supplier and they require that the party having the right to recourse duly observes its duties, in particular the duty to make a complaint in respect of defects.

VII. General Limitation on Liability

In all cases in which the supplier – in deviation from the conditions outlined above – is obligated by reason of contractual or statutory rulings to pay compensation or reimbursement, his liability shall be limited only to cases in which he, his executive employees or vicarious agents are guilty of culpable intent, gross negligence or injury to life, body or health. Strict (no-fault) liability pursuant to the product liability law as well as liability in respect of the legal fulfilment with regard to any guarantee as to the quality or condition of the product or work performed shall remain unaffected; as shall the liability for culpable breach of material contractual obligations, which is, however, limited to predictable damage typical of this type of contract, except for cases outlined in s. 1. However, the above rule does not imply a reversal of the burden of proof, putting the customer at a disadvantage.

 

VIII. Terms of Payment

  1. Payment is to be made in € (EURO) and is to go exclusively to the supplier.
  2. Unless otherwise agreed, the purchase price for supplies or other services is to be paid as follows: 2% discount within 14 days, net (without deduction) within 30 days from the date of the invoice. Granting of a discount is subject to settlement of all undisputed outstanding invoices which have fallen due earlier.  
  3. If payment is not made within the agreed period allowed for payment, interest to the amount of the legal interest rate of 8 percentage points above the ECB’s base interest rate applicable at the time shall be charged, unless the supplier provides evidence of higher damages. The customer has the right to prove lower damages.
  4. Payment by cheques or bills of exchange may be refused. # Cheques and re-discountable bills of exchange shall be accepted only on account of performance; all associated bank charges are to be borne by the customer.
  5. The customer may offset an account or assert his right of retention only if his claims are indisputable or have become res judicata.
  6. Sustained non-compliance with terms of payment or circumstances, which raise serious doubts as to the credit worthiness of the customer, will result in all supplier’s claims for payments becoming due immediately. In this case, the supplier shall also be entitled to demand pre-payment for deliveries still outstanding and even to withdraw from the contract after a reasonable period of extension has elapsed.

IX. Molds (Tooling)

  1. The price for molds/tools also includes costs for a one-time sampling but not the costs for test and processing equipment nor costs incurred by modifications initiated by the customer. Costs for further sampling required by and attributable to the supplier shall be at his own expense.
  2. Unless otherwise agreed, the supplier shall be and remain the owner of the molds made for the customer by the supplier himself or a third party commissioned by the supplier. The molds are only to be used for orders of the customer for as long as the customer meets his financial obligations and obligations to take delivery punctually. The supplier shall be obliged to replace these molds free of charge only if they are required to fulfil the output quantity guaranteed to the customer. The supplier’s obligation to store the mold shall expire two years after the last delivery of parts produced from the said mold and after prior notification of the customer.
  3. If, as per agreement, the customer is to become the owner of the molds, the ownership in them will pass to him after full payment of their purchase price. Delivery or handing over of the molds to the customer is replaced by the storage of the said molds with the supplier in favour of the customer. Independent of the customer’s legal right to claim for surrender of the molds and the life of the molds, the supplier shall be entitled to exclusive possession of the same until the end of the contract period. The supplier has to identify the molds as ‘outside property’ and insure them at the customer’s request and expense.
  4. The liability of the supplier in respect of storage and maintenance of molds owned by the customer as per clause 3 above and/or molds loaned by the customer to the supplier shall be limited to the amount of care the supplier would use for his own property. Costs incurred in maintenance and insurance shall be borne by the customer. The obligations of the supplier cease when, after completion of the order and a corresponding request by the supplier, the customer fails to collect the molds within a reasonable period of time. The supplier has, at any rate, the right to withhold the molds as long as the customer has not complied with his contractual duties to the full extent.

X. Provision of Materials

  1. If materials are provided by the customer, they are to be delivered at the customer’s own cost and risk, in time and in faultless condition including reasonable excess quantities of at least 5%.
  2. If the above prerequisites are not complied with, the delivery period will extend accordingly. Except for cases of force majeure, the customer shall bear any additional costs, including extra costs incurred due to disruptions of production.

XI. Industrial Property Rights and Defects of Title

  1. If the supplier is to supply goods in compliance with drawings, models, samples or using parts provided by the customer, the customer shall guarantee that no property rights of third parties in the country of destination of the goods are infringed thereby. The supplier will notify the customer of any such rights of which he has knowledge. The customer has to indemnify the supplier against any claims of third parties and pay compensation for any damage incurred. If a third party, by invoking a property right this third party holds, forbids production or supply of goods by the supplier, the supplier shall be entitled to stop all work – without any examination of the legal situation – until the legal situation has been clarified by the customer and the third party involved. If, due to the delay, it is unreasonable to require the supplier to continue the order, the supplier may rescind the contract.
  2. Any drawings and samples made available to the supplier but not leading to an order are to be returned on request; if no such request is made, the supplier shall be entitled to destroy them three month after submission of the offer or quotation. The same obligation applies accordingly to the customer. The party entitled to dispose by destruction has to inform the other party of its intention prior to doing so and in good time.
  3. The supplier retains all copyrights and, if applicable, industrial property rights, in particular all the rights of utilization and exploitation rights in models, molds and equipment, drafts/designs and drawings made or designed by him or by a third party on his behalf.
  4. Should other deficiencies of title exist, section VI shall accordingly apply to them.

XII. Place of Performance and Jurisdiction

  1. The place of performance shall be the location of the supplying plant.
  2. The place of jurisdiction, including proceedings relating to deeds, bills of exchange and cheques, shall be, at the supplier’s option, the competent court at the seat of the supplier or of the customer.
  3. 3.German law shall apply exclusively. The application of the United Nations Convention of 11th April 1980 on Contracts for the International Sale of Goods (BGBl (Federal Law Gazette, Germany), 1989, page 586) as it applies to the Federal Republic of Germany (BGBl 1990, page 1477) shall be excluded.

Version: August 2007

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