German Commercial Contract Law — Legal Advisory
Commercial contract law covers the full B2B agreement spectrum — supply contracts, distribution and agency agreements, framework agreements, and AGB review. Poorly drafted contracts are a common starting point for B2B disputes. We advise German Mittelstand companies and international counterparties on drafting, review, and negotiation, in German and English.
Contents
Contract Drafting — B2B Agreements
The starting point in commercial contract advisory is whether the contract accurately reflects the actual agreement between the parties and adequately allocates risk. Standard contracts from generic templates have two recurring weaknesses: they are designed for the average case, and they often do not reflect current obligations. For domestic B2B transactions, companies must be able to receive structured electronic invoices from 1 January 2025; issuing obligations are phased in under transitional rules.
We draft and review commercial contracts that are structurally clear, legally sound, and adapted to the specific business relationship and industry context — in German and English.
Supply and Delivery Contracts
Supply contracts in German commercial law engage the HGB inspection and notification obligations under § 377 HGB: where the contract is a commercial transaction for both parties, the buyer must inspect delivered goods without undue delay and notify defects promptly. Hidden defects must be notified without undue delay after discovery. Where notification is not made in time, the goods may be deemed approved in relation to the defect. In international supply chains, this deadline is regularly missed.
Standard supply contract provisions cover delivery conditions (INCOTERMS, risk transfer, delivery deadlines), simple, extended and expanded retention of title structures (einfacher/verlängerter/erweiterter Eigentumsvorbehalt), defect notification and warranty periods, force majeure and adaptation clauses, and liability limitations.
Distribution Agreements
Distribution agreements govern the terms on which a manufacturer or supplier grants a distributor the right to sell products in a defined territory. Key provisions cover exclusivity (exclusive, selective, or open distribution), minimum purchase obligations, territorial restrictions, marketing support, pricing, confidentiality, and termination.
Under German and EU law, vertical agreements may be subject to competition-law assessment, in particular under the Vertical Block Exemption Regulation (VBER). We advise on the commercial structure and identify competition-law interfaces where separate or more detailed competition-law assessment may be required.
Agency Agreements — § 84 HGB
A commercial agent (Handelsvertreter) under § 84 HGB is an independent intermediary who solicits business for a principal. The legal framework for commercial agents is partly mandatory. The compensation claim under § 89b HGB arises only where the statutory requirements are met, in particular where the principal continues to derive substantial benefits from customers acquired or expanded by the agent and payment is equitable. The claim is capped at one year’s average annual commission or remuneration, generally calculated on the basis of the last five years or the shorter contract period. The claim cannot be excluded in advance. Post-contractual non-compete obligations (§ 90a HGB) require compensation and must meet statutory limits.
Distributors or authorised resellers (Eigenhändler), who purchase and resell in their own name and for their own account, are in principle not commercial agents. However, commercial-agent rules, including aspects of § 89b HGB, may be applied by analogy in specific constellations, especially where the distributor is integrated into the supplier’s sales organisation and obliged to transfer customer data.
We draft and review agency and distribution agreements with attention to the mandatory statutory framework, the compensation exposure on termination, and the practical commercial terms.
General Terms and Conditions — AGB Review
General terms and conditions (Allgemeine Geschäftsbedingungen, AGB) allow a company to apply uniform contractual terms across all business relationships. They save negotiation time but create legal risk where individual clauses fail the review under §§ 305 ff. BGB.
In B2B transactions, the standard is less strict than in consumer contracts, but the rules still apply: surprising clauses under § 305c(1) BGB do not become part of the contract; clauses that unreasonably disadvantage the counterparty or lack transparency are void under § 307 BGB. Liability limitations, especially for gross negligence, bodily injury, essential contractual obligations and wilful misconduct, require careful drafting. Exclusions of liability for wilful misconduct are prohibited under § 276(3) BGB.
We review existing AGB for problem clauses, advise on AGB negotiation strategy between parties with conflicting standard terms (the “battle of forms”), and draft new AGB — for domestic B2B relationships and for international counterparties, in German and English.
Framework Agreements
Framework agreements (Rahmenverträge) establish the general terms for a business relationship, with individual orders or call-offs executed against the framework. They are used in supplier-customer relationships with recurring transactions. The framework agreement covers pricing, quality standards, delivery conditions, liability, and termination; individual orders incorporate the framework terms.
The relationship between framework terms and individual order terms, and the question of which terms prevail in case of conflict, should be addressed expressly rather than left to uncertain battle-of-forms rules.
Pre-Contract Negotiation Support
We advise at the pre-contract stage: reviewing term sheets and letters of intent, identifying risk allocation issues before drafting begins, and providing input during negotiation to avoid provisions that create litigation risk later. Early legal input can be more cost-efficient than advice only after a dispute has arisen.
How We Advise
We advise German Mittelstand companies and international counterparties on the full range of commercial contracts — from drafting and review through to negotiation support and dispute prevention. For cross-border commercial contracts, see our international contracts page. For general contract law and civil contracts, see our contract law page. Our firm advises in German and English.
Advice by Alexander Kagan, Attorney at Law, admitted to the Hanseatic Bar Association Hamburg. As of: June 2026.
The contents of this page are for general information only and do not constitute legal advice. A mandate is established only upon express acceptance.
Frequently Asked Questions — German Commercial Contract Law
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Standard contracts serve the average case. Where the transaction has specific risk allocation needs — unusual payment terms, significant liability exposure, cross-border elements, or long-term supply relationships — a bespoke contract is the more robust solution. Standard templates can be a useful starting point but should be reviewed against the actual transaction before being relied upon.
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The main areas: surprising clauses under § 305c BGB that may not become part of the contract; clauses that unreasonably disadvantage the counterparty under § 307 BGB; liability limitations for gross negligence (limited enforceability in B2B); and prohibited liability exclusions for wilful misconduct. In B2B contracts, AGB review is less consumer-protective than in B2C, but transparency and unreasonable-disadvantage control still matter. In international contexts, proper incorporation under the applicable law is an additional question.
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Exclusivity and territorial scope, minimum purchase obligations, pricing and rebate structures, marketing support, sub-distribution rights, termination provisions (notice, post-termination obligations), and confidentiality. Where the arrangement is actually structured as a commercial agency relationship under § 84 HGB, the mandatory compensation rules under § 89b HGB must be addressed. For distributors or resellers, analogous application may become relevant in specific constellations.
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On termination of a commercial agency agreement, the agent may have a statutory compensation claim under § 89b HGB where the principal continues to derive substantial benefits from customers acquired or expanded by the agent and payment is equitable. The claim is capped at one year’s average annual commission or remuneration, generally calculated from the last five years or the shorter contractual period. It cannot be excluded in advance.
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That depends on the choice-of-law clause, Rome I and — for international sales of goods — the CISG. The CISG may apply where the parties have their places of business in different Contracting States, or where conflict-of-law rules lead to the law of a Contracting State, unless excluded or modified by agreement. Rome I often points to the law of the habitual residence of the characteristic performer, subject to exceptions and mandatory rules. Choice of law and choice of jurisdiction are separate questions. Further detail is on our international contracts page.
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Key elements: clear definition of obligations and deliverables, measurable performance standards, unambiguous payment terms and default provisions, express notice requirements, a workable termination mechanism, a dispute resolution clause with specified jurisdiction, and a governing law clause checked against §§ 307 ff. BGB and realistic risk exposure.
Commercial Contracts — Request Advice
We advise on B2B commercial contracts — drafting, review, negotiation, AGB, distribution, agency, and supply agreements.
Please outline your situation briefly. Useful details include contract type, counterparty location, governing law, and the specific question.
