Chapters of the article
Terms and conditions are a document that regulates the mutual rights and obligations of the entrepreneur and the customer in various situations that have not been regulated in the text of the contract itself. They become part of the contract itself when the customer agrees to them (usually by signing a contract that refers to the terms and conditions, or by checking the appropriate option on the e-shop or other website).
Advantages and disadvantages of terms and conditions
Their main advantage is to simplify the process of concluding a contract. If the terms and conditions are sufficiently detailed, many things do not need to be regulated in the contract itself, which greatly facilitates the contractual relationship.
The main disadvantage is the loss of an individual approach to the customer and, as a rule, a take-it-or-leave-it approach where the customer has little chance to influence the contractual relationship. They must therefore either accept the terms and conditions as a whole or refuse to enter into a contract.
If the terms and conditions deviate from the contract, this does not affect the validity of the contract or the terms and conditions. The provisions contained directly in the contract then take precedence over the use of the terms and conditions.
Are you considering writing terms and conditions?
We will draw up new terms and conditions for you or review the existing ones. We guarantee the correctness of the document according to the new Civil Code. We act quickly, throughout the whole territory of the Czech Republic. You will know the price in advance and you can pay only after the service has been provided.
What is essential to focus on in relation to terms and conditions?
1) Familiarising the parties with the terms and conditions before signing the contract
Our first recommendation is not about the content, but about the process of concluding a contract. It is essential to provide the other party with the terms and conditions so that they can become properly acquainted with them. It is not enough to simply mention them. However, if the terms and conditions are annexed to the draft contract, the other party is presumed to have taken due notice of them.
You must keep the terms and conditions and any changes to them in such a way that the customer can view them again or be provided with older versions. It is also recommended that you send customers a link to these terms and conditions in a confirmation email.
2) Who is a party to the contract?
If you sell goods or your services to customers who are consumers, then beware. The Civil Code defines a consumer as “a person who, outside the scope of his business activity or outside the scope of the independent exercise of his profession, enters into a contract with a business”. If you sell to consumers, your terms and conditions will be held to a higher standard and you will need to adapt them to the many requirements of the law.
3) Withdrawal from the contract
As we have discussed above, the terms and conditions form part of the contract and the customer has a right to be told how to withdraw from such a contract and, if applicable, when that right ceases. If you sell goods or provide services outside the usual place of business, which applies in particular to the terms and conditions for an e-shop, the customer who is a consumer must be informed of the right to withdraw from the contract within 14 days from the date of receipt of the goods.
If such a customer does not receive this instruction, the Civil Code provides that he may withdraw from the contract within one year and fourteen days of receipt of the goods. In some cases, you may have to take back the goods and refund the customer’s money, which can be very unpleasant, not least from a cash flow point of view (more than a year after the sale of the goods).
The document should ideally refer to a standardised withdrawal form, which the customer just sends in if they want to end the contract. If you also want to be able to withdraw from the contract, you must specify in the terms exactly how and in what circumstances this can happen.
4) GDPR within the terms and conditions
You must tell the customer how you process their data. The legislation sets out a number of requirements for this, including the scope of information your customers must receive. Generally, if you want to pass on customer data to other parties, you will need to get their consent to do so. Again, you must inform the customer of this in accordance with the law and to the extent of the information required by law.
5) Complaints in case of defects
Your terms and conditions must tell the customer how to proceed if the goods or services are defective. You should also detail the warranty you issue for the goods. From experience, we recommend that you put in place a separate process for these matters, which it is a good idea to describe clearly in your terms and conditions. Firstly this will satisfy the requirement of the law, secondly it will clarify this key area internally for your company and the customer.
The customer has the right to know who to complain to about you. If you are entering into terms and conditions online, which is particularly true for e-commerce, your terms and conditions must include an indication of how consumer complaints about you as a business will be dealt with out of court. This should include the address of the competent authority where the consumer can address such a complaint. For businesses that are not specifically regulated, this body will primarily be the Czech Trade Inspection Authority, but in some cases it may also be other state supervisory authorities.
6) Arbitration clause
The customer has the right to know who to complain to. If your terms and conditions are concluded online, which is especially true for e-shops, your terms and conditions must include an indication of how consumer complaints against you as a business will be settled out of court. This should include the address of the competent authority where the consumer can address such a complaint. For businesses that are not specifically regulated, this body will primarily be the Czech Trade Inspection Authority, but in some cases it may also be other state supervisory authorities.
7) Payment terms, delivery terms, delivery conditions,
What often interests the customer first of all is the practical information relating to the actual delivery of the goods. The customer should therefore find out from your terms and conditions:
- the identity of the seller of the goods or service provider, including their address, registration number and contact details
- the goods or services they are purchasing, including their characteristics,
- the price of the goods or services including all taxes and charges,
- the method of payment for the goods,
- the terms of delivery of the goods (e.g. obligation to pay a deposit), including the cost of delivery of the goods,
- the client’s rights arising from defective performance.
The new Civil Code also introduces a range of provisions that are prohibited. In any case, your terms and conditions should not contain: 1) provisions that exclude the rights of customers – consumers from defective performance, 2) the possibility of the entrepreneur to keep the purchase price if the consumer withdraws from the contract, 3) the right of the entrepreneur to withdraw from the contract without reason, while the consumer does not have this right, 4) the right of the entrepreneur to increase the price without the possibility of the consumer to withdraw from the contract, or 5) the contractual penalty if the customer withdraws from the contract and many others.
The terms and conditions are a fundamental document for your business. They shape your relationships with your customers, so it pays to invest energy in drafting them properly. Do not rely on free downloadable templates of general terms and conditions, as such a document will not effectively protect you.