Commercial transactions

Commercial law provides for special regulations for commercial transactions: The regulations for commercial purchases apply if both contracting parties are merchants.

Trade purchase

The parties involved in a commercial purchase must observe special legal regulations. The provisions of the Commercial Act change the statutory payment and warranty regulations.

What is a trade purchase in German Law?

A trade purchase is a purchase that is a trade transaction for at least one of the contracting parties involved. A trading transaction is a legal transaction of a merchant or a trading company. So, if a merchant or a trading company is involved in the purchase, the rules on the commercial purchase apply. The rules of commercial purchase are also applied to an exchange contract, the purchase of securities and work supply contracts.

Delay in acceptance of a trade purchase

There are peculiarities in the default of acceptance. The creditor of a service is in default of acceptance if he does not accept the service despite a proper offer from the debtor. As a result, the risk that the goods will perish will pass to the creditor. In the case of a purchase, this means that if the goods are lost, the buyer still must pay the purchase price if the seller has offered him delivery or collection of the goods. If the buyer then does not accept the goods, he bears the risk of loss or damage to the goods.

In a commercial purchase, the seller can deposit the goods in a public warehouse or in any other way at the risk and expense of the buyer. He is also entitled to have the goods auctioned publicly if he has previously informed the seller that he would do so. The seller can instruct a commercial broker to auction the goods publicly.

In Germany, the seller can also effect a  so-called self-help sale of the goods on behalf of the buyer.

Our law firm, which specializes in commercial law, can advise companies on the individual requirements for delayed acceptance when purchasing a trade.

Fixed-trade purchase             

A specialty is the fixed-trade purchase. If it has been agreed between the parties that the service is to be carried out at a fixed time or within a reasonable period, there are special cancellation rights and the right to compensation. A fixed-trade purchase is a business where timely performance is of particular importance to a party. If the service has not been performed within a reasonable period or within the specified period, the contract partner can withdraw from the contract. The other contracting party is in arrears, compensation for non-performance can be requested. Damage can result from the fact that the goods have become more expensive due to the failure to meet the deadline.

A lawyer specializing in commercial law can classify the clauses as a fixed-trade purchase in individual cases and advise them on the rights.

Obligation to examine and notify

The German commercial code regulates in §§ 377-379 HGB the obligation of the buyer to examine and give notice of defects. If the purchase is a commercial transaction for both contractual partners, the buyer must examine the goods immediately after delivery by the seller and, if a defect becomes apparent, notify the buyer immediately. The requirements are met if both contracting parties are merchants or trading companies.

The delivery of the goods is assumed: To do this, the goods must have come into the sphere of control of the buyer or an auxiliary person engaged by the buyer in such a way that he can examine them for defects.

The goods must have a defect. This is the case if the goods do not have the agreed properties or are not suitable for their intended use.

The buyer violates the obligation to give notice of defects if he does not examine the goods after delivery. The law stipulates, for the course and duration of the investigation, that it is based on the normal course of business. If a large quantity is delivered, the buyer must randomly examine the goods. In the case of a small amount, a corresponding thorough check is necessary.

Regarding the timely notice of defects, a distinction is made between an open and a hidden defect. An open defect can often be recognized by a proper inspection of the goods. In this case, the notice period is a few days. In the case of hidden defects, which require a higher level of inspection, the period only begins to run when the defect has been discovered.

If the buyer has violated his obligation to give notice of defects, he can no longer assert his warranty rights. However, the contractual parties can exclude the statutory regulations. This is the case, for example, in general terms and conditions. A lawyer specialized in commercial law can provide targeted advice on the individual cases of violation of the obligation to notify. Our law firm represents both buyers and sellers in the appeal to the exclusion of the guarantee of the obligation to give notice of defects out of court and in court.

Commission business

A commission transaction is a trading transaction in which a principal, a commission agent and another person are involved. A commission agent is someone who takes over commercially to buy or sell goods or securities on behalf of another (the principal) in his own name. A distinction is made between the purchasing commission and the sales commission. With the purchasing commission, the commission agent acts for the buyer. With the sales commission, the commissioner acts for the seller. The commission agent does not act like a commercial agent in a foreign name but becomes a party to the transaction. He is bound by instructions from the principal. This means that he must follow the instructions of the principal.

Commission contract

A commission contract must first be concluded between the commission agent and the principal. The contract stipulates rules regarding the object of purchase or sale and the commission of the commission agent. Further provisions regarding the purchase and sale price, the liability of the commission agent, the duration and termination of the contract can also be made.

Execution of the commission business

The commission business must be carried out between the commission agent and the other person from whom the object is bought or sold. The commission agent is obliged to provide the consideration to this person. In most cases, the principal does the principal does not openly appear to the buyer or seller. Therefore, the commission agent closes the commission business in his own name and for his own account. The commission agent pays the consideration to the third person. He has a claim against the principal on reimbursement of the purchase price of the goods. When the agent receives the goods, he acquires ownership of the goods. However, he is obliged to return the goods to the principal.

Commitments and rights in commission business

The commission agent is entitled to a commission. The commission agent can request payment if the transaction has been carried out between the third party and the commission agent. If the third party provides the commission agent, the commission business is deemed to have been carried out. The commission agent’s entitlement to payment shall remain in effect if the transaction concluded by the commission agent has not been carried out for a reason that is in the person of the principal.

The commission agent is entitled to reimbursement of the expenses, which also include the expenses for the remuneration for the use of the storage rooms and the means of transport of the commission agent.

If the commission agent does not act in accordance with the instructions of the principal, he is obliged to compensate him. In this case, the principal does not have to accept the transaction against himself, so that he can refuse to take delivery of the goods. If the deviation from the instructions is slight, he must however accept the transaction against himself.

In individual cases, it is advisable to have the exact provisions of the commission contract checked by a lawyer specializing in commercial law.