All available in:
- Trade practices are not defined by law, but are standards of behavior in business transactions that have developed over many years of practice.
- In the German Commercial Code (HGB), the term "commercial practice" is mentioned in § 346 and emphasizes legal certainty and predictability.
- Trade practices offer flexibility and adapt to changing market conditions.
- Examples include payment terms, trade discounts and delivery terms that are industry-specific.
- A custom must be generally known and regularly applied in order to be recognized.
- Trade practices may be unclear or outdated and need to be reviewed regularly.
- They offer legal certainty, but must comply with applicable law.
Introduction
In business, there are certain behaviors and practices that are recognized and accepted over time. These practices are referred to as trade customs. In Germany, commercial customs are anchored in the German Commercial Code (HGB). In this article, we will take an in-depth look at the concept of trade customs under the HGB.
Definition of commercial practice
A commercial custom is a rule that has developed in business transactions and is regarded as binding by the merchants involved. These are norms of behavior that are not laid down by law but have evolved through many years of practice and shape business behavior in specific industries or regions.
Trading customs in the HGB
In the German Commercial Code, the term “Handelsbrauch” is mentioned in § 346 HGB. According to this provision, commercial customs and customary law are to be taken into account insofar as they apply to merchants and do not violate mandatory statutory provisions.
Importance of trade customs
Trade customs are important because they:
- Provide legal certainty and predictability by setting uniform standards for certain business practices.
- Allow flexibility as they evolve over time and adapt to changing market conditions.
- Promote efficiency by being accepted practices that reduce the need for formal agreements in certain areas.
Examples of trade customs
- Payment periods: In certain industries, it may be customary for invoices to be paid within a certain period, e.g. 30 days.
- Trade discounts: granting discounts for bulk orders or early payment.
- Delivery terms: In certain industries, certain delivery terms, such as “free domicile”, may be standard.
Recognition of trade practices
For a commercial practice to be recognized, it must be generally known and regularly applied. In addition, it must not violate any legal requirements. Courts may recognize trade customs as part of the applicable law if they are relevant in the specific case.
Challenges and criticism
Trade customs can sometimes be unclear or outdated. In addition, they may conflict with modern business practices or legal regulations. It is therefore important that trade practices are regularly reviewed and adjusted as necessary.
Conclusion
Trade customs play an important role in business transactions by establishing norms of behavior and practices that have been developed over time. They provide legal certainty and efficiency, but must be handled with care to ensure they are in compliance with applicable law and modern business practices.
