General Conditions of Delivery

General Conditions of Delivery

for products and performances of the electrical industry (‘Green Delivery Conditions’ – GDC)
for use in commercial transactions between companies
Non-binding recommended conditions of ZVEI - Zentralverband Elektrotechnik- und Elektronikindustrie e. V. [German Electrical and Electronic Manufacturers' Association]
Version: June 2011

Article I: General provisions
1. These GDC apply exclusively for the legal relationship between supplier and purchaser in connection with the deliveries and/or performances of the supplier (hereinafter: Deliveries). General terms and conditions of the purchaser only apply insofar as the supplier has approved of them expressly in writing. The written declarations to be agreed upon by both parties are authoritative for the scope of Deliveries.

2. The supplier retains ownership, copyright and exploitation rights to cost proposals, drawings and other documents (hereinafter: documents), without limitation. The documents must only be made available to third parties after prior written consent of the supplier and must be returned immediately upon request if the order is not issued to the supplier. Sections 1 and 2 apply accordingly for documents of the purchaser; however, they must be made available to third parties to whom the supplier has permissible transferred Deliveries.

3. The purchaser has the exclusive right of use to standard software and firmware with the agreed performance characteristics in unchanged form on the agreed devices. The purchaser can create a backup copy of the standard software without an express agreement.

4. Partial deliveries are permissible, insofar as they are reasonable for the purchaser.

5. The term ‘claims for damages” in these GDC also include claims to compensation for wasted expenditure.

Article II: Prices, payment conditions and offsetting
1. The prices are to be understood ex works, excluding packaging, plus the applicable statutory value-added tax.

2. If the supplier has assumed setup or assembly and nothing different has been agreed upon, the purchaser shall bear all additional necessary costs, such as travel and accommodations and transport costs, in addition to the agreed remuneration.

3. Payments must be made free of bank transfer charges to the supplier.

4. The purchaser can only offset with such claims that are undisputed or have been ruled legally valid.

Article III: Retention of title
1. The items of Deliveries (goods subject to retention of title) remain the property of the supplier until fulfilment of all claims to which they are entitled from the purchaser from the business relationship. If the value of all security rights to which the supplier is entitled exceeds the amount of all secured claims by more than 20%, the supplier shall, at the purchaser’s request, release a corresponding part of the security rights; the supplier is free to choose which of the different security rights to release.

2. While the retention of title remains in effect, the purchaser is prohibited from pledging the goods as collateral and permitted to resale of the goods in the normal course of business on the condition that the retailer receives payment from their customer or makes the reservation that the property transfers to the customer after they have fulfilled their payment obligations.

3. If the purchaser resells goods subject to retention of title, they hereby assign their future claims from their customers from the resale with all ancillary rights – including any payment balance claims – by way of security to the supplier without the requirement for an additional separate declaration. If the goods subject to retention of title are sold together with other items without agreement on an individual price for the goods subject to retention of title, the purchaser assigns the part of the total price claim to the supplier equivalent to the price of the goods subject to retention of title billed to the supplier.

4. a) The purchaser is permitted to process the goods subject to retention of title or mix or combine them with other items. The processing takes place on behalf of the supplier. The purchaser keeps the resulting new item same for the supplier with the diligence of a prudent merchant. The new item applies as goods subject to retention of title.
b) The supplier and purchaser hereby agree that in case of combination or mixture with other items not belonging to the supplier, the supplier is entitled to co-ownership of the new item in the amount equal to the value of the combined or mixed goods subject to retention of title in proportion to the value of the remaining goods at the time of the combination or mixture. The new item applies as goods subject to retention of title in this respect.
c) The regulation on the assignment of claims according to Section 3 also applies to the new item. However, the assignment only applies up to the amount billed by the supplier for the goods subject to retention of title which have been processed, combined or mixed billed by the supplier.
d) If the purchaser does not combine the goods subject to retention of title with property or movable items, they hereby assign their claim to which they are entitled as payment for the combination, with all ancillary rights, by way of security in the amount of the proportion of the value of the combined goods subject to retention of title to the value of the remaining combined goods at the time of the combination to the supplier.

5. Until revocation, the purchaser is authorised to collect assigned claims from the resale. If important grounds are provided, particularly default of payment, discontinued payment, initiation of insolvency proceedings, bill protest or justified indications of excessive debt or the threat of impending inability of the purchaser to pay, the supplier is entitled to revoke the purchaser's authorisation to collect payment. Moreover, the supplier can disclose the assignment for security after prior warning in observance of a reasonable period,
recover the assigned claims and demand disclosure of the assignment for security by the purchaser towards the customer.

6. In case of pledging as security, seizure or other acts of disposal or intervention by third parties, the purchaser must notify the supplier immediately. With establishment of prima facie evidence of a legitimate interest, the purchaser must immediately provide the supplier with the information required for assertion of their rights towards the customer and to furnish the necessary documentation.

7. In case of breaches of duty by the purchaser, particularly in case of default of payment, the supplier is entitled, after the unsuccessful expiration of a grace period for the performance, to withdrawal from the contract in addition to a return of the goods; the statutory provisions on the dispensability of the setting of a grace period remain unaffected. The purchaser is obligated to surrender the goods. In the return of the goods and/or assertion of the retention of title or the pledging of goods subject to retention of title by the supplier, there is no right of withdrawal from the contract unless the supplier would have expressly declared their withdrawal.

Article IV: Periods for deliveries; default
1. Observance of delivery periods is subject to the timely receipt of all documents to be delivered by the purchaser, necessary authorisations and approvals, particularly of plans, and observance of the agreed payment conditions and other duties by the purchaser. If these requirements are not fulfilled in good time, the periods shall be extended to a reasonable extent; this does not apply if the supplier is responsible for the delay.

2. If non-observance of the periods occurs due to
a) force majeure, e.g. mobilisation, war, acts of terror, insurgency or similar events (e.g. strike, lockout),
b) viruses and other attacks of third parties on the IT system of the supplier, insofar as this has taken place despite observance of ordinary due diligence for protective measures,
c) impediments based on German, United States or other application national, EU or international regulations of international trade legislation or based on other circumstances for which the supplier is not responsible, or
d) delivery of the supplier which does not take place correctly or on time,
the periods shall be extended to a reasonable extent.

3. If the supplier enters into default, the purchaser can, insofar as they can convincingly demonstrate that they have incurred damages as a result – demand compensation for each completed week of default in the amount of 0.5 % each, however not higher than 5 % of the price for the part of the deliveries which could not be used for the intended purpose because of the default.

4. Damage claims of the purchaser due to default of delivery and damage claims instead of performance which exceed the limits specified in Section 3 are excluded in all cases, even after the expiration of a period for delivery set by the supplier. This does not apply in this respect for cases of liability based on intent, gross negligence or based on injury to the life, limb or health. The purchaser can only withdraw from the contract in the scope of the statutory provisions
if the supplier is responsible for the default of delivery. A change to the burden of proof to the detriment of the purchaser is not associated with the preceding regulations.

5. The purchaser is obligated, at the request of the supplier, to declare within a reasonable period whether they intend to withdraw from the contract due to the delay or insist on delivery.

6. If shipment or delivery is delayed by more than one month after notification of readiness for delivery at the request of the purchaser, the purchaser can be billed a storage fee equal to 0.5 % of the price of the items of the deliveries for each additional new week of delay, however a maximum of 5 %. The parties are entitled to furnish proof of higher or lower storage costs.

Article V: Transfer of risk
1. The risk transfers to the purchaser, even with delivery carriage paid, as follows:
a) for delivery without setup or assembly, when it is shipped or has been collected. On request, and at the expense of the purchaser, the delivery will be insured by the supplier against the usual transport risks;
b) for delivery with setup or assembly, on the day of handover on the purchaser's premises or, if agreed upon, after successful test operation.

2. If the shipment, delivery, beginning, performance of setup or assembly, transfer on the purchaser’s premises or test operation is delayed for reasons for which the purchaser is responsible or the purchaser enters into default of acceptance, the risk transfers to the purchaser.

Article VI: Setup and assembly
If nothing different has been agreed upon in writing, the following provisions apply for setup and assembly:
1. The purchaser must carry out and provide, at their own expense:
a) all excavation, construction and other extra work performed by other sectors, including the necessary qualified workers and assistants, construction materials and tools;
b) the items and materials required for assembly and commissioning, such as scaffolding, lifting equipment and other devices, fuels and lubricants;
c) energy and water at the place of use, including connections, heating and lighting;
d) adequately large, suitable, dry and lockable rooms at the assembly site for the storage of machine parts, apparatuses, materials, tools, etc. and suitable work and break rooms for the assembly personnel, including sanitary facilities that are appropriate for the purpose; moreover, the purchaser must take appropriate measures for protection of the property of the supplier and assembly personnel, which they would take for their own property;

e) protective clothing and protective devices which are necessary due to the special circumstances of the assembly site.
2. Prior to the beginning of assembly work, the purchaser must provide the necessary information about the location of concealed electrical, gas, and water lines or similar systems, as well as the necessary statistical information without being prompted to do so by the supplier.

3. Prior to the beginning of setup of assembly, the provisions and items necessary for the assumption of work must be available at the setup or assembly site and all preliminary work must be advanced to the necessary extent prior to the beginning of setup so that the setup or assembly can begin as agreed upon and can be carried out without interruption. Access routes and the setup or assembly location must be level and clear of all obstacles.

4. If the setup, assembly or commissioning are delayed due to circumstances for which the supplier is not responsible, the purchaser must bear the costs, to a reasonable extent, for wait times and additional required travel of the supplier or assembly personnel.

5. The purchaser must promptly acknowledge the duration of the work hours of the assembly staff and the completion of the setup, assembly or commissioning.

6. If the supplier demands acceptance of the delivery after completion, it must be carried out by the purchaser within two weeks. The acceptance applies whether the purchaser allows the two-week period to expire or if the delivery has been utilised – after conclusion of an agreed test phase, if applicable.

Article VII: Receipt
The purchaser must not refuse to receive deliveries due to negligible defects.

Article VIII: Material defects
The supplier is liable for material defects as follows:
1. All parts or performances having material defects are subject to subsequent improvement, re-delivery or re-provision according to the discretion of the supplier, insofar as the cause of said defects already existed at the time of the transfer of risk.

2. Claims to subsequent fulfilment are limited to 12 months from the statutory start of the limitation period; the same applies for withdrawal and price reduction. This period does not apply if the law in accordance with Article 438, para. 1, no. 2 (buildings and building material), 479, para. 1 (right of recourse) and 634a, para. 1, no. 2 (construction defects) of German Civil Code prescribe longer periods, in case of intent, fraudulent concealment of the defects and non-compliance with a quality guarantee. The statutory regulations on expiry suspension and restart of the periods remains unaffected.

3. Complaints of defects by the purchaser must take place promptly in writing.

4. If defects are reported, payments of the purchaser can be repaid in an amount proportional to the appearing material defects. The purchaser can only withhold payments if a complaint of defects is asserted for which there can be no doubt about the legitimacy. The purchaser is not entitled
to a right of retention if their claims for defects have expired. If complaints of defects are reported falsely, the supplier is entitled to demand compensation from the purchaser for the expenses which they have incurred.

5. The supplier must be granted the opportunity for subsequent fulfilment within a reasonable period.

6. If the subsequent fulfilment is unsuccessful, the purchaser can, without prejudice to any damage claims in accordance with Section 10
– withdraw from the contract or reduce the remuneration.

7. Claims for defects do not exist in the case of only negligible deviations from the agreed quality, in case of only negligible impairments to the usability, in case of natural wear or damage which was the result of incorrect or negligent handling after the transfer of risk, excessive stress, unsuitable operating materials, deficient construction work, unsuitable foundations or which arise due to external influences which are not presupposed according to the contract, as well as software errors that cannot be reproduced. If changes or repairs are carried out by the purchaser or third parties, there are not claims for defects for these or the resulting consequences.

8. Claims of the purchaser due to expenses necessary for the purpose of subsequent fulfilment, particularly transport, road, labour and material costs are excluded, insofar as the expenses increase due to a subsequent relocation of the subject of the delivery to a different location than the branch location of the purchaser, unless said relocation corresponds to its intended use.

9. The purchaser right of recourse against the supplier in accordance with Article 478 of German Civil Code (recourse of the merchant) only exists to the extent that the purchaser has not reached any agreements with their buyer exceeding the statutory claims for defects. Moreover, No. 8 applies accordingly for the scope of the right of recourse of the purchaser against the supplier in accordance with Article 478, para. 2 of German Civil Code.

10. Damage claims of the purchaser based on material defects are excluded. This does not apply in case of fraudulent concealment of the defect, non-compliance with a quality guarantee, injury to the life, limb or health and in case of intentional or grossly negligent breach of duty on the part of the supplier. A change to the burden of proof to the detriment of the purchaser is not associated with the preceding regulations. Additional or different claims of the purchaser than those regulated in Art. VIII based on material defects are excluded.

Article IX: Commercial property rights and copyright; defect of title
1. If nothing different has been agreed upon, the supplier is obligated to provide the delivery exclusively unencumbered by commercial property rights and copyrights of third parties (hereinafter: property rights) in the country of the delivery location. If a third party raises entitled claims against the purchaser based on a violation of property rights by the supplier, the supplier is liable towards the purchaser within the period defined in Art. VIII, Section 2 as follows:
a) For the affected deliveries, the supplier shall, according to their own discretion, arrange for a right of use, change said deliveries so that they do not violate the property right or exchange the deliveries. If this is not possible for the supplier
under reasonable conditions, the purchaser shall be entitled to the statutory rights of withdrawal and reduction in price;
b) the duty of the supplier to provide compensation for damages is based on Art. XII;
c) The aforementioned obligations of the supplier only exist insofar as the purchaser has promptly informed the supplier of the claims asserted by the third party, has not recognised a violation and all measures of defence and settlement negotiations remain at the supplier’s disposal. If the purchaser discontinues use of the delivery due to mitigation or other important reasons, they are obligated to inform the third party that the discontinuation of use does not equate to recognition of a violation of property rights.

2. Claims of the purchaser are excluded insofar as they are responsible for the violation of property rights.

3. Moreover, claims of the purchaser are excluded insofar as the violation of property rights is caused by the special specifications of the purchaser, a use that is unforeseeable for the supplier or caused by said use such that the delivery is changed by the purchaser or used together with products not delivered by the supplier.

4. In case of a violation of property rights, the provisions of Art. VIII, Section 4, 5 and 9 apply accordingly for the remainder of claims of the purchaser regulated in Section 1a).

5. If other defects of title are present, the provisions of Art. VIII apply accordingly.

6. Further claims or claims of the purchaser other than those regulated in Art. IX against the supplier and their vicarious agents other based on defects of title are excluded.

Article X: Fulfilment of title
1. The contractual fulfilment is subject to the reservation that there are not obstacles based on German, United States or other applicable national, EU or international regulations of international trade legislation and no embargoes or other sanctions opposed to said fulfilment.

2. The purchaser is obligated to provide all information and documentation required for the export, shipment and storage.

Article XI: Impossibility, contractual amendment
1. If the delivery is impossible, the purchaser is entitled do demand compensation for damages, unless the supplier is not responsible for the impossibility. However, the purchaser's damage claims are limited to 10 % of the value of the part of the delivery which cannot be used for the intended purpose because of the impossibility. This limitation does not apply in cases of intent, gross negligence or due to an injury to the life, limb or health; this does not entail a change of the burden of proof to the detriment of the purchaser. The right of the purchaser to withdraw from the contract remains unaffected.

2. If events as defined in Art. IV, Section 2 a) to c) significantly change the financial importance or the content of the delivery or have a considerable influence on the operations of the supplier, the contract shall be adapted appropriately in observance of goodwill. If this is not economically viable, the supplier shall be entitled to withdraw from the contract. The same applies if necessary export approvals are not issued or usable. If the supplier utilises this right of withdrawal, they must notify the purchaser promptly after recognising the extent of the event and, specifically if an extension of the delivery period had been agreed upon with the purchaser.

Article XII: Other damage claims
1. If nothing different is regulated in these GDC, damage claims of the purchaser, regardless of the legal basis, particularly due to a breach of duty from the contractual obligation and from tortious liability, are excluded.

2. This does not apply in the case of liability for the following reasons:
a) in accordance with the German Product Liability Act;
b) in case of intent;
c) in case of gross negligence of owners, legal representatives or managing employees;
d) in case of fraudulent intent;
e) in case of non-compliance with an assumed guarantee;
f) due to a culpable injury to the life, limb or health; or
g) due to a culpable breach of cardinal contractual duty.
The claim for damages for the breach of a cardinal contractual duty is, however, limited to the typically foreseeable damage for the relevant type of contract, insofar as none of the other cases mentioned above applies.

3. A change to the burden of proof to the detriment of the purchaser is not associated with the preceding regulations.

Article XIII: Jurisdiction and applicable law
1. If the purchaser is a merchant, for all disputes arising directly or indirectly from the contractual relationship the sole jurisdiction is the location of the registered office of the supplier. However, the supplier is also entitled to file suit in the registered domicile of the purchaser.

2. This contract and its interpretation are subject to Germany law to the exclusion of the United Nations Convention on Contracts for the International Sale of Goods (CISG).

Article XIV: Binding nature of the contract
In the case of the invalidity of individual provisions, the remaining parts of the contract remain binding. This does not apply if adherence to the contract would entail an unreasonable hardship for a party.