Terms and Conditions

GENERAL CONDITIONS
FOR THE SUPPLY OF PRODUCTS AND SERVICES
OF THE ELECTRICAL AND ELECTRONICS INDUSTRY (“GL”)*

for commercial transactions between businesses
recommended by ZVEI - Zentralverband Elektrotechnik- und Elektronikindustrie e. V.
– as of June 2005 –
* “Grüne Lieferbedingungen”. The original German text shall be the
governing version.


I. GENERAL PROVISIONS
1. Legal relations between Supplier and Purchaser in connection with supplies
and/or services of the Supplier (hereinafter referred to as “Supplies”) shall be
solely governed by the present GL. The Purchaser’s general terms and con-
ditions shall apply only if expressly accepted by the Supplier in writing. The
scope of delivery shall be determined by the congruent mutual written decla-
rations.
2. The Supplier herewith reserves any industrial property rights and/or copy-
rights pertaining to its cost estimates, drawings and other documents (her-
einafter referred to as “Documents”). The Documents shall not be made
accessible to third parties without the Supplier’s prior consent and shall,
upon request, be returned without undue delay to the Supplier if the contract
is not awarded to the Supplier. Sentences 1 and 2 shall apply mutatis mut-
andis to the Purchaser’s Documents; these may, however, be made accessi-
ble to those third parties to whom the Supplier has rightfully subcontracted
Supplies.
3. The Purchaser has the non-exclusive right to use standard software and
firmware, provided that it remains unchanged, is used within the agreed per-
formance parameters, and on the agreed equipment. Without express agree-
ment the Purchaser may make one back-up copy of standard software.
4. Partial deliveries are allowed, unless they are unreasonable to accept for the
Purchaser.
5. The term „claim for damages” used in the present GL also includes claims
for indemnification for useless expenditure.

II. PRICES, TERMS OF PAYMENT, AND SET-OFF
1. Prices are ex works and excluding packaging; value added tax shall be
added at the then applicable rate.
2. If the Supplier is also responsible for assembly or erection and unless other-
wise agreed, the Purchaser shall pay the agreed remuneration and any inci-
dental costs required, e. g. for traveling and transport as well as allowances.
3. Payments shall be made free Supplier’s paying office.
4. The Purchaser may set off only those claims which are undisputed or non-
appealable.

III. RETENTION OF TITLE
1. The items pertaining to the Supplies (“Retained Goods”) shall remain the
Supplier’s property until each and every claim the Supplier has against the
Purchaser on account of the business relationship has been fulfilled. If the
combined value of the Supplier’s security interests exceeds the value of all
secured claims by more than 10 %, the Supplier shall release a correspon-
ding part of the security interest if so requested by the Purchaser; the
Supplier shall be entitled to choose which security interest it wishes to
release.
2. For the duration of the retention of title, the Purchaser may not pledge the
Retained Goods or use them as security, and resale shall be possible only for
resellers in the ordinary course of their business and only on condition that
the reseller receives payment from its customer or makes the transfer of pro-
perty to the customer dependent upon the customer fulfilling its obligation to
effect payment.
3. The Purchaser shall inform the Supplier forthwith of any seizure or other act
of intervention by third parties.
4. Where the Purchaser fails to fulfil its duties, fails to make payment due, or
otherwise violates its obligations the Supplier shall be entitled to rescind the
contract and take back the Retained Goods in the case of continued failure
following expiry of a reasonable remedy period set by the Supplier; the sta-
tutory provisions providing that a remedy period is not needed shall be unaf-
fected. The Purchaser shall be obliged to return the Retained Goods.
The fact that the Supplier takes back Retained Goods and/or exercises the
retention of title, or has the Retained Goods seized, shall not be construed
to constitute a rescission of the contract, unless the Supplier so expressly
declares.

IV. TIME FOR SUPPLIES; DELAY
1. Times set for Supplies shall only be binding if all Documents to be furnished
by the Purchaser, necessary permits and approvals, especially concerning
plans, are received in time and if agreed terms of payment and other obliga-
tions of the Purchaser are fulfilled. If these conditions are not fulfilled in time,
times set shall be extended reasonably; this shall not apply if the Supplier is
responsible for the delay.
2. If non-observance of the times set is due to force majeure such as mobiliza-
tion, war, rebellion or similar events, e. g. strike or lockout, such time shall be
extended accordingly. The same shall apply if the Supplier does not receive
its own supplies in due time or in due form.
3. If the Supplier is responsible for the delay (hereinafter referred to as “Delay”)
and the Purchaser has demonstrably suffered a loss therefrom, the
Purchaser may claim a compensation as liquidated damages of 0.5 % for
every completed week of Delay, but in no case more than a total of 5 % of
the price of that part of the Supplies which due to the Delay could not be put
to the intended use.
4. Purchaser’s claims for damages due to delayed Supplies as well as claims
for damages in lieu of performance exceeding the limits specified in No. 3
above are excluded in all cases of delayed Supplies, even upon expiry of a
time set to the Supplier to effect the Supplies. This shall not apply in cases
of mandatory liability based on intent, gross negligence, or due to loss of life,
bodily injury or damage to health. Rescission of the contract by the
Purchaser based on statute is limited to cases where the Supplier is respon-
sible for the delay. The above provisions do not imply a change in the bur-
den of proof to the detriment of the Purchaser.
5. At the Supplier’s request, the Purchaser shall declare within a reasonable
period of time whether it, due to the delayed Supplies, rescinds the contract
or insists on the delivery of the Supplies.
6. If dispatch or delivery, due to Purchaser’s request, is delayed by more than
one month after notification of the readiness for dispatch was given, the
Purchaser may be charged, for every additional month commenced, storage
costs of 0.5 % of the price of the items of the Supplies, but in no case more
than a total of 5 %. The parties to the contract may prove that higher or, as
the case may be, lower storage costs have been incurred.

V. PASSING OF RISK
1. Even where delivery has been agreed freight free, the risk shall pass to the
Purchaser as follows:
a) if the Supplies do not include assembly or erection, at the time when the
Supplies are shipped or picked up by the carrier. Upon the Purchaser’s
request, the Supplier shall insure the Supplies against the usual risks of
transport at the Purchaser’s expense;
b) if the Supplies include assembly or erection, at the day of taking over in
the Purchaser’s own works or, if so agreed, after a fault-free trial run.
2. The risk shall pass to the Purchaser if dispatch, delivery, the start or perfor-
mance of assembly or erection, the taking over in the Purchaser’s own
works, or the trial run is delayed for reasons for which the Purchaser is
responsible or if the Purchaser has otherwise failed to accept the Supplies.
 

VI. ASSEMBLY AND ERECTION
Unless otherwise agreed in written form, assembly and erection shall be subject
to the following provisions:
1. The Purchaser shall provide at its own expense and in due time:
a) all earth and construction work and other ancillary work outside the
Supplier’s scope, including the necessary skilled and unskilled labor, con-
struction materials and tools,
b) the equipment and materials necessary for assembly and commissioning
such as scaffolds, lifting equipment and other devices as well as fuels and
lubricants,
c) energy and water at the point of use including connections, heating and
lighting,
d) suitable dry and lockable rooms of sufficient size adjacent to the site for
the storage of machine parts, apparatus, materials, tools, etc. and ade-
quate working and recreation rooms for the erection personnel, including
sanitary facilities as are appropriate in the specific circumstances; further-
more, the Purchaser shall take all measures it would take for the protec-
tion of its own possessions to protect the possessions of the Supplier and
of the erection personnel at the site,
e) protective clothing and protective devices needed due to particular con-
ditions prevailing on the specific site.
2. Before the erection work starts, the Purchaser shall unsolicitedly make avai-
lable any information required concerning the location of concealed electric
power, gas and water lines or of similar installations as well as the necessa-
ry structural data.
3. Prior to assembly or erection, the materials and equipment necessary for the
work to start must be available on the site of assembly or erection and any
preparatory work must have advanced to such a degree that assembly or
erection can be started as agreed and carried out without interruption.
Access roads and the site of assembly or erection must be level and clear.
4. If assembly, erection or commissioning is delayed due to circumstances for
which the Supplier is not responsible, the Purchaser shall bear the reasona-
ble costs incurred for idle times and any additional traveling expenditure of
the Supplier or the erection personnel.
5. The Purchaser shall attest to the hours worked by the erection personnel
towards the Supplier at weekly intervals and the Purchaser shall immediate-
ly confirm in written form if assembly, erection or commissioning has been
completed.
6. If, after completion, the Supplier demands acceptance of the Supplies, the
Purchaser shall comply therewith within a period of two weeks. In default
thereof, acceptance is deemed to have taken place. Acceptance is also dee-
med to have been effected if the Supplies are put to use, after completion of
an agreed test phase, if any.
 

VII. RECEIVING SUPPLIES
The Purchaser shall not refuse to receive Supplies due to minor defects.
 

VIII. DEFECTS AS TO QUALITY
The Supplier shall be liable for defects as to quality (“Sachmängel”, hereinafter
referred to as “Defects”,) as follows:
1. Defective parts or defective services shall be, at the Supplier’s discretion,
repaired, replaced or provided again free of charge, provided that the reason
for the Defect had already existed at the time when the risk passed.
2. Claims for repair or replacement are subject to a statute of limitations of 12
months calculated from the start of the statutory statute of limitations; the
same shall apply mutatis mutandis in the case of rescission and reduction.
This shall not apply where longer periods are prescribed by law according to
Sec. 438 para. 1 No. 2 (buildings and things used for a building), Sec. 479
para. 1 (right of recourse), and Sec. 634a para. 1 No. 2 (defects of a building)
German Civil Code (“BGB”), in the case of intent, fraudulent concealment
of the Defect or non-compliance with guaranteed characteristics
(Beschaffenheitsgarantie). The legal provisions regarding suspension of the
statute of limitations (“Ablaufhemmung”, “Hemmung”) and recommence-
ment of limitation periods shall be unaffected.
3. Notifications of Defect by the Purchaser shall be given in written form without
undue delay.
4. In the case of notification of a Defect, the Purchaser may withhold payments
to an amount that is in a reasonable proportion to the Defect. The Purchaser,
however, may withhold payments only if the subject-matter of the notification
of the Defect involved is justified and incontestable. The Purchaser has no
right to withhold payments to the extent that its claim of a Defect is time-bar-
red. Unjustified notifications of Defect shall entitle the Supplier to demand
reimbursement of its expenses by the Purchaser.
5. The Supplier shall be given the opportunity to repair or to replace the defec-
tive good (“Nacherfüllung”) within a reasonable period of time.
6. If repair or replacement is unsuccessful, the Purchaser is entitled to rescind
the contract or reduce the remuneration; any claims for damages the
Purchaser may have according to No. 10 shall be unaffected.
7. There shall be no claims based on Defect in cases of insignificant deviations
from the agreed quality, of only minor impairment of usability, of natural wear
and tear, or damage arising after the passing of risk from faulty or negligent
handling, excessive strain, unsuitable equipment, defective civil works, inap-
propriate foundation soil, or claims based on particular external influences
not assumed under the contract, or from non-reproducible software errors.
Claims based on defects attributable to improper modifications or repair
work carried out by the Purchaser or third parties and the consequences the-
reof are likewise excluded.
8. The Purchaser shall have no claim with respect to expenses incurred in the
course of supplementary performance, including costs of travel, transport,
labor, and material, to the extent that expenses are increased because the
subject-matter of the Supplies has subsequently been brought to another
location than the Purchaser’s branch office, unless doing so complies with
the normal use of the Supplies.
9. The Purchaser’s right of recourse against the Supplier pursuant to Sec. 478
BGB is limited to cases where the Purchaser has not concluded an agree-
ment with its customers exceeding the scope of the statutory provisions
governing claims based on Defects. Moreover, No. 8 above shall apply muta-
tis mutandis to the scope of the right of recourse the Purchaser has against
the Supplier pursuant to Sec. 478 para. 2 BGB.
10. The Purchaser shall have no claim for damages based on Defects. This shall
not apply to the extent that a Defect has been fraudulently concealed, the
guaranteed characteristics are not complied with, in the case of loss of life,
bodily injury or damage to health, restrictions to liberty and/or intentionally or
grossly negligent breach of contract on the part of the Supplier. The above
provisions do not imply a change in the burden of proof to the detriment of
the Purchaser. Any other or additional claims of the Purchaser exceeding the
claims provided for in this Article VIII, based on a Defect, are excluded.
 

IX. INDUSTRIAL PROPERTY RIGHTS AND COPYRIGHT;
DEFECTS IN TITLE
1. Unless otherwise agreed, the Supplier shall provide the Supplies free from
third parties’ industrial property rights and copyrights (hereinafter referred to
as “IPR”) with respect to the country of the place of delivery only. If a third
party asserts a justified claim against the Purchaser based on an infringe-
ment of an IPR by the Supplies made by the Supplier and used in conformity
with the contract, the Supplier shall be liable to the Purchaser within the time
period stipulated in Article VIII No. 2 as follows:
a) The Supplier shall choose whether to acquire, at its own expense, the
right to use the IPR with respect to the Supplies concerned or whether to
modify the Supplies such that they no longer infringe the IPR or replace
them. If this would be impossible for the Supplier under reasonable con-
ditions, the Purchaser may rescind the contract or reduce the remunera-
tion pursuant to the applicable statutory provisions.
b) The Supplier’s liability to pay damages is governed by Article XI.
c) The above obligations of the Supplier shall apply only if the Purchaser (i)
immediately notifies the Supplier of any such claim asserted by the third
party in written form, (ii) does not concede the existence of an infringe-
ment and (iii) leaves any protective measures and settlement negotiations
to the Supplier’s discretion. If the Purchaser stops using the Supplies in
order to reduce the damage or for other good reason, it shall be obliged
to point out to the third party that no acknowledgement of the alleged
infringement may be inferred from the fact that the use has been discon-
tinued.
2. Claims of the Purchaser shall be excluded if it is responsible for the infringe-
ment of an IPR.
3. Claims of the Purchaser are also excluded if the infringement of the IPR is
caused by specifications made by the Purchaser, by a type of use not fore-
seeable by the Supplier or by the Supplies being modified by the Purchaser
or being used together with products not provided by the Supplier.
4. In addition, with respect to claims by the Purchaser pursuant to No. 1 a)
above, Article VIII Nos. 4, 5, and 9 shall apply mutatis mutandis in the event
of an infringement of an IPR.
5. Where other defects in title occur, Article VIII shall apply mutatis mutandis.
6. Any other claims of the Purchaser against the Supplier or its agents or any
such claims exceeding the claims provided for in this Article IX, based on a
defect in title, are excluded.
 

X. IMPOSSIBILITY OF PERFORMANCE; ADAPTATION OF CONTRACT
1. To the extent that delivery is impossible, the Purchaser is entitled to claim
damages, unless the Supplier is not responsible for the impossibility. The
Purchaser’s claim for damages is, however, limited to an amount of 10 % of
the value of the part of the Supplies which, owing to the impossibility, can-
not be put to the intended use. This limitation shall not apply in the case of
mandatory liability based on intent, gross negligence or loss of life, bodily
injury or damage to health; this does not imply a change in the burden of
proof to the detriment of the Purchaser. The Purchaser’s right to rescind the
contract shall be unaffected.
2. Where unforeseeable events within the meaning of Article IV No. 2 substan-
tially change the economic importance or the contents of the Supplies or
considerably affect the Supplier’s business, the contract shall be adapted
taking into account the principles of reasonableness and good faith. To the
extent this is not justifiable for economic reasons, the Supplier shall have the
right to rescind the contract. If the Supplier intends to exercise its right to
rescind the contract, it shall notify the Purchaser thereof without undue delay
after having realized the repercussions of the event; this shall also apply even
where an extension of the delivery period has previously been agreed with
the Purchaser.
 

XI. OTHER CLAIMS FOR DAMAGES; STATUTE OF LIMITATIONS
1. The Purchaser has no claim for damages based on whatever legal reason,
including infringement of duties arising in connection with the contract or
tort.
2. The above shall not apply in the case of mandatory liability, e. g. under the
German Product Liability Act (“Produkthaftungsgesetz”), in the case of
intent, gross negligence, loss of life, bodily injury or damage to health, or
breach of a condition which goes to the root of the contract (“wesentliche
Vertragspflichten”). However, claims for damages arising from a breach of a
condition which goes to the root of the contract shall be limited to the fore-
seeable damage which is intrinsic to the contract, unless caused by intent or
gross negligence or based on liability for loss of life, bodily injury or damage
to health. The above provision does not imply a change in the burden of
proof to the detriment of the Purchaser.
3. To the extent that the Purchaser has a claim for damages, it shall be time-
barred upon expiration of the statute of limitations pursuant to Article VIII No.
2. The same shall apply to the Purchauser’s claims in connection with
actions undertaken to avoid any damage (e. g. callback). In the case of
claims for damages under the German Product Liability Act, the statutory
statute of limitations shall apply.

XII. VENUE AND APPLICABLE LAW
1. If the Purchaser is a businessman, sole venue for all disputes arising direct-
ly or indirectly out of the contract shall be the Supplier’s place of business.
However, the Supplier may also bring an action at the Purchaser’s place of
business.
2. Legal relations existing in connection with this contract shall be governed by
German substantive law, to the exclusion of the United Nations Convention
on contracts for the International Sale of Goods (CISG).

XIII. SEVERABILITY CLAUSE
The legal invalidity of one or more provisions of this Agreement in no way affects
the validity of the remaining provisions. This shall not apply if it would be unrea-
sonable for one of the parties to be obligated to continue the contract.

© 2005 ZVEI - Zentralverband Elektrotechnik- und Elektronikindustrie e. V., Stresemannallee 19, 60596 Frankfurt am Main. All rights reserved.