Contract risk management clauses—checklist


Published by a ÀÏ˾»úÎçÒ¹¸£Àû Commercial expert
Checklists

Contract risk management clauses—checklist


Published by a ÀÏ˾»úÎçÒ¹¸£Àû Commercial expert

Checklists
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Introduction

It is important to ensure that when contracting in a business to business context, there is as much contractual protection for a party as its bargaining position will allow. This Checklist considers how certain key contractual clauses can manage risk in contracts and protect businesses (from the perspective of both supplier and customer) and how these clauses can be negotiated to gain maximum benefit from them.

Key provisionsGeneral comments
Payment
Payment securityCheck that the entity you are buying from or selling to is financially secure by obtaining a credit check.
Consider whether some form of payment guarantee is required, eg:
• A parent company guarantee or
• A letter of credit or performance bond from a bank
CustomerSupplier
• Is the supplier financially able to meet your supply requirements?• Will the customer be able to meet its payment obligations?
• Consider the need for credit insurance.
• Important to continue doing credit checks on the customer throughout the duration of the contract to manage overall exposure to financial risks.
Payment
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Jurisdiction(s):
United Kingdom
Related legal acts:

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