The conclusion of contracts has mutated from a basic private sector competence into a demanding craft. Formal requirements are the least of the problems here – but there are pitfalls lurking there too. Anyone who wants to avoid the invalidity of a contract or individual contract elements for substantive reasons must be careful and precise in contract drafting. Because laws such as, for example, the German Civil Codethe German Commercial Code (HGB), the Act Against Restraints of Competition (GWB)the Copyright Act (UrhG), the Legal Services Act (RDG) and/or the Foreign Trade Act (AWG) impose strict limits on the freedom of contract of the parties and may impede the validity or enforceability of contractual provisions.
There is even less room for maneuver when contract provisions are "General Terms and Conditions" (AGB). This can be the case, for example, because they are intended for repeated use or a clause has been adopted from a template. In such cases, further statutory prohibitions must be observed. Their outlines are hardly comprehensible for laypersons and are significantly shaped by case law – particularly that of the Federal Court of Justice.
Additional complexity arises when the contracting parties are resident in different states or when a contract is to be performed in whole or in part abroad (international contracts). In such cases, not only numerous laws but also multiple legal systems may have to be observed simultaneously. Furthermore, especially with international contracts, the question of whether and how one's own position can be enforced if necessary must be examined particularly critically.
Economically important contracts should therefore not be concluded without involving professional legal expertise. Economically particularly important contracts are usually
- with significant payment or other performance obligations,
- with long runtime and/or
- whose implementation involves significant risks.
This often applies – especially in an international context – in particular to:
- Framework, cooperation, and project agreements of any kind
- License and franchise agreements
- Purchase agreements for businesses, capital goods, or other high-risk goods (e.g., components and other parts)
- Research and/or Development Contracts (R&D)
- Contracts for the development or customization of software and/or AI systems
- Shareholder agreements and partnership agreements
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