AGB: Everything you need to know about general terms & conditions in Germany

Get a better understanding of AGBs (general terms and conditions) in Germany with our comprehensive guide. Navigate critical clauses and legal compliance with ease.


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AGB: Understanding GT&Cs in Germany

Allgemeine Geschäftsbedingungen, or AGB for short, are what are called general terms and conditions (GT&Cs) in English. They’re basically ready-made rules for contracts.

Officially, they are pre-formulated contractual terms and conditions in accordance with Sections 305 et seq. of the BGB (German civil code). They serve to simplify and standardise mass contracts, as the clauses of the general terms and conditions are not negotiated individually and per person but apply equally to all contracting parties. The general terms and conditions of an internet trader, therefore, apply to all sales contracts unless the trader negotiates a different contract with the contracting party. The inclusion of terms and conditions in contracts is governed by § 305 BGB.

Let’s break it down in simple terms:

GT&Cs are basically pre-written rules for contracts. They’re useful because they make it easier to deal with many contracts at once. Instead of negotiating each detail separately, you’ve got standard rules that apply to everyone involved.

Let’s say you buy something online. The seller’s terms and conditions apply to your purchase unless you agree otherwise with them.

So, when it comes to including terms and conditions in contracts, there are rules to follow. It’s all about making things fair and clear for everyone involved.

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AGB: Are GT&Cs mandatory in Germany?

Do businesses in Germany have to create general terms and conditions (GT&Cs)?

Actually, companies aren’t required to draft GT&Cs. Instead, other laws step in. If there aren’t any GT&Cs, laws like the Fernabsatzgesetz (distance selling act), Handelsgesetzbuch (commercial code), and BGB (civil code) kick in.

Creating GT&Cs is up to you. But there are perks:

1. Standardised contracts: GT&Cs ensure all contracts follow the same rules.
2. Legal safety net: If there’s a contract snag, having GT&Cs can provide legal backup.
3. User-friendly: GT&Cs that serve your business.
4. Level playing field: They help balance out any terms the other party might have.

So, while GT&Cs aren’t a must, they can make for a smoother ride.

GT&Cs are essential for online shops in Germany

Running an online shop? Pay attention to your terms and conditions – they’re pretty important. They’re where you lay down some crucial things for your customers:

1. When is a contract entered into?
2. What payment options are available?
3. How much is the delivery charge?
4. Who handles shipping and delivery?
5. Who pays for returns if the contract is cancelled?

So, if you’re in the online retail game, make sure your terms and conditions are easy to find on your website. That way, your customers can check them before they buy.

What should GT&Cs in Germany contain?

There’s no hard and fast rule about what has to be in GT&Cs, but sellers need to clarify to buyers which clauses apply when they make a deal. Here’s what you might find:

  • Cancellation policy: Customers must know how to cancel a contract, especially for distance purchases.
  • Pricing: Make it clear whether your prices include taxes or not.
  • Reservation of title: It’s wise to retain ownership of your goods until your customer pays in full.

You may also see clauses about liability, disposal instructions or more details about you as the seller. Sometimes, terms and conditions include deadlines for reporting defects, whether apparent or not.

GT&Cs are all about transparency and ensuring everyone’s on the same page.

AGB: What to watch out for when creating GT&Cs

When crafting terms and conditions, thinking about your customers is essential. The law gives more leeway to B2B contracts than B2C ones. That’s because the law assumes that typical consumers may need help understanding complex contract terms, so it aims to protect them more.

You’ll find lots of rules for different terms and conditions in legal jargon. Remember the rule of clarity. Your GT&Cs should be easy to understand without needing extra tools to read the small print, and your customers should be able to read and understand them without difficulty.

AGB: Troubleshooting for GT&Cs

If you run an online shop, general terms and conditions can help you avoid a number of problems from the outset:

Troubleshooting Solution
Conflicting general terms and conditions Use defence clauses to ensure that only your own terms and conditions, not those of the contractual partner, apply after the contract is concluded.
Delivery time calculated too tightly Delay the start of delivery times.
Rising production costs Include price change clauses that allow prices to be changed.
Payment terms were determined imprecisely Define precise rules for payment settlement: Are cash discounts permitted? Is payment by instalments accepted?
The customer doesn’t pay Define payment targets and default damage clauses.
Customer cancels the contract, a reversal is required Establish cancellation clauses that regulate the procedure and consequences of cancellation in a way that is binding for both parties.
Provisions are invalid Include a severability clause.


Are template GT&Cs legally sound?

Many websites offer templates for AGB (GT&Cs) generators, which can quickly create a set for your business.

However, knowing if these templates are legally sound is essential, which might be challenging for non-experts. Using copied terms could leave loopholes or not align with your online store or business model.

It’s wise to have a lawyer review your terms or, ideally, create them from scratch to ensure legal compliance. This approach safeguards against potential legal issues and protects you from legal action.

Copying existing terms from a similar shop is not a good idea! First, the clauses are likely unsuitable for your needs. Secondly, copying may infringe on someone else’s copyright: Intellectual property rights also apply to terms and conditions.

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AGB: When are GT&Cs not valid?

Contrary to popular belief, more than merely linking to GT&Cs or general terms and conditions (GT&Cs) on your online shop is needed for them to be valid. For the AGB to be effective, they need to be integrated into the respective contract for the end customer.

The following criteria must be met for the GT&Cs to be valid:

1. The customer must be explicitly directed to the GT&Cs.
2. The customer must be able to acknowledge the GT&Cs.
3. The customer must confirm agreement with the GT&Cs.

Suppose it’s not possible to explicitly point customers to the AGB. In that case, there must be a clearly visible notice at the end of the contract.

Also, the contracting party must be able to take notice of the contents reasonably, considering any recognizable physical disabilities. Before placing an order, customers must confirm that they have read and accepted the GT&Cs.

In e-commerce practice, this is usually done at the contract conclusion through a checkbox with accompanying text such as “I confirm that I have read and accepted the AGB,” including a link to the AGB. Furthermore, it is advisable to email the GT&Cs along with a statement regarding the right of withdrawal to the buyer along with the order confirmation.

AGB: When do GT&Cs not apply?

In Sections §§ 305 to 310 of the BGB (civil code), numerous special regulations for content control classify specific clauses as inadmissible. In particular, § 309 contains various clause prohibitions. The following provisions are among those deemed inadmissible:

1. Clauses so unusual that the contractual partner would not expect them are invalid (§ 305c).
2. Ambiguous clauses are always interpreted against the entrepreneur who formulated the AGB.
3. The remainder remains valid if an individual AGB is excluded from the contract due to regulations.

Note: If clauses “unreasonably disadvantage the contractual partner of the user contrary to the requirements of good faith” (§ 307 BGB), the respective clause is invalid.

The competent court decides what is considered unreasonable in case of dispute. Since the judge may—but is not obliged to—rely on case law from similar cases, AGB is practically never 100% legally secure.


AGB: General terms and conditions, in a nutshell

Consider whether you really need GT&Cs or if the regulations set by the legislature are sufficient for your project. When creating GT&Cs for your company, it’s crucial to involve a lawyer—this is the only way to ensure high legal security.

However, complete protection is not possible under § 307 BGB, as the courts assess the invalidity of a clause due to ‘unreasonable disadvantage’ to a contractual partner differently.

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