From the orgalime s2000 conditions to the orgalime s2011 general conditions for the supply of mechanical, electrical and electronic products

The new S 2012-conditions: an overview of the major changes

Revision of the Orgalime-S 2000-Conditions

As the international sale of products represents the core business of companies in the mechanical and
electrical engineering industries in Europe, Orgalime has soon recognised that these companies would
benefit from a set of general conditions for the supply of products, which could be used all over the
world. The first version of the Orgalime-Supply Conditions has been already published in 1992 (S 92-
conditions) and these conditions have ever since been among Orgalime’s most widely-used legal
publications. They are indeed used at a very large scale. Millions of hard copies have been sold
through the years, whereas the electronic use has increased to a very substantial level.
The Orgalime-working group Legal Affairs (consisting of lawyers representing the national member
associations of Orgalime) updates these conditions from time to time to take account of legal
developments and experience. After a first update which resulted in the S 2000-conditions, the
working group has now adopted a new updated text, which results in the S 2012-conditions.
The S 2000-conditions have been reviewed in detail. The Orgalime-working group Legal Affairs
unanimously concluded that the Orgalime-Supply-conditions have been widely accepted and
endorsed in international business and meet the parties’ needs. Thus, the review work could be
restricted to an update of the S 2000-conditions.
Some material changes have been applied. New texts have been inserted and existing texts have
been amended. Apart from these material changes, texts have been amended to clarify the meaning.
These changes have however not changed the well-balanced nature of the conditions. Finally,
definitions of the most important terms have been added in a separate Clause 2. These definitions aim
to increase legal certainty for the user of S 2012 and to avoid misunderstandings between the parties.

Below the material changes in the conditions are listed:
Clause 10 (former Clause 9)

The Incoterms rule EXW (Ex Works) has been replaced by the rule FCA (Free Carrier). Accordingly,
the Supplier is responsible to clear the Contract Products for export. The Supplier is normally in a
better practical position to perform this task, being based in the country of export. He has to bear the
costs of customs formalities, duties, taxes and other fees resulting from the export procedures.
In contrast to the S 2000-conditions partial delivery is basically not permitted.
Clause 11 (former Clause 10)

It is now stated in general terms that a period of time within which the Supplier has to deliver the
Contract Products only starts to run as soon as the Purchaser has fulfilled any preconditions upon
which the parties have agreed. Theses preconditions have to be specified in the Contract. The former
clause was restricted to a limitative enumeration of preconditions.
Clause 13 (former Clause 12)

In the revised version any circumstance which is attributable to the Purchaser entitles the Supplier to
extend the time for delivery. In the former text this extension could only occur if the delay resulted from
Force Majeure or from an act or omission of the Purchaser. The new text broadens the scope for such
Clause 14 (former Clause 13)

In the S 2012-conditions liquidated damages are calculated on each commenced (S 2000: completed)
Clause 21 (former Clause 20)

If the purchaser fails to pay, the S 2012-conditions explicitly provide for a right of the Supplier to claim
recovery costs. Recovery costs shall be 1% of the amount due. The S 2000-conditions did not mention
recovery costs, which could be a reason for disputes.
Clause 36 (former Clause 32)

If the Supplier does not remedy a defect, the final period to be set by the Purchaser shall not be less
than one week. This precise minimal time period was not mentioned in the S 2012-conditions.
Clause 37 (former Clause 33)

If the Product has not been successfully repaired by the Supplier, the Purchaser’s right to terminate
the contract and to be compensated up to a maximum of 15 per cent has been limited to that part of
the contract which can as a consequence of the defect not be used as intended. This amendment
takes account of situations where the defect does not affect the use of other substantial parts of the
Clause 38 (former Clause 36)

The liability period for replaced or repaired parts ends in any case one year from the end of the normal
liability period (in S2000: two years from the beginning of the normal liability period).
Clause 41 (former Clause 39)

Currency and export restrictions, epidemics, natural disasters, extreme natural events and terrorist
acts have been added as examples of Force Majeure-events.


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