What are payment terms and conditions?

What are payment terms and conditions?

Terms of payment in quotations

In the case of a sale, the payment and how such payment is to be made is part of the object of the contract, since the buyer assumes as the main obligation of the contract to pay the agreed price in the agreed manner (art.1273 of the Civil Code), and it is also part of the cause of the contract, the sale contract is made, by the seller, with the purpose of collecting its price as it is an onerous contract (art. 1274 of the Civil Code).

Once fixed, in one way or another, the term and form of payment must be respected; art. 61 of the Commercial Code prohibits terms of grace, courtesy or which, by any other name, imply a postponement of the performance of the obligation unless they are expressly agreed in the contract or ordered by law.

For the purposes of this prohibition, the Law considers payment in cash both payment in bills and coins and payment by check or bank check and electronic means of payment provided that they are made as payment to bearer.

Payment terms and conditions examples

Direct payment represents a certain form of anticipation with the variant that it is the buyer who receives all the advantage, leaving the seller in absolute inferiority, since he must send the goods and wait for payment until they have arrived at their destination.

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It may happen that the importer withdraws the goods and deliberately and unduly delays payment, or finally fails to make payment, with serious losses for the exporter who, in the best of cases, will have to return the goods to their destination, assuming unforeseen costs, thus suffering an effective loss. In this modality there are no guarantees, the intervention of a bank is limited to facilitating a draft under instructions from the client.

Documentary collection is used when the level of confidence that the exporter has in the importer is optimal and therefore does not require more guarantees than those of his own conduct and credit. It assumes a high level of knowledge between both and has the advantage of lower costs than a letter of credit.

Types of payment terms sat

1.1 Within the meaning of § 13 BGB (German Civil Code), the following terms of payment and delivery shall apply exclusively to all our deliveries and services vis-à-vis companies.

1.2 Contrary conditions of purchase or other terms and conditions of business of the customer shall not apply, even if we have not expressly objected to them. Any regulations to the contrary shall only be valid if they have been agreed in writing.

1.3 These terms of delivery and payment shall apply to all future contractual relations between the contracting parties, without it being necessary to refer to them again in each individual case.

2.1 Our offers are not binding unless we have expressly designated them as binding. An effective contract shall only come into existence with our confirmation of the customer’s order; this may be effected by the delivery of the ordered goods or by the performance of the agreed service.

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Cash payment terms

In general, a website/app should have a valid and accurate Terms of Service document whenever complex issues are at stake, such as e-commerce, where sensitive information such as payment details are involved.

On e-commerce websites, the Terms of Service is usually the document containing information related to the terms of sale and means of payment, shipping, delivery, cancellation and withdrawal conditions, etc., as required by consumer protection regulations. European B2C (sale of goods/services) service providers must also include, among other things, information on online dispute resolution (ODR) to explain the mandatory online dispute resolution process.