신규 또는 인상된 관세 비용이 어떻게 할당되는지 상업 계약을 검토하는 것 외에도 평가해야 할 또 다른 핵심 영역은 어느 한쪽 당사자가 계약을 해지할 수 있는 권리가 있는지 여부입니다. 한쪽 당사자가 가격 책정에 대해 불만을 제기하는 경우 해지 권한은 탈출구를 제공할 수 있습니다.
Termination for Convenience and Other Rights to Terminate
Termination for convenience clauses allow one or both parties to walk away, and some suppliers specifically include provisions allowing them to terminate a contract due to cost increases. Therefore, even if the allocation of tariffs is favorable for a party, if the other party has the option to terminate the contract, the parties may ultimately reconvene at the negotiating table in the event of increased tariffs.
Notably, termination rights are not always found in the contract’s “Termination” section—they may appear within other sections, such as those related to pricing adjustments, force majeure, and changes in law.
Effect of Termination Provisions
Finally, when evaluating whether termination is the right move, “effect of termination” provisions should be reviewed. The associated costs—such as cancellation fees or inventory buyouts—could be significant and may outweigh the benefits of walking away.
In addition, depending on the “effect of termination” provisions, the buyer may still be required to purchase products under any order accepted prior to the date of termination, and the supplier may still be required to supply pursuant to any such orders.
Want to learn more about other contract strategies that may mitigate tariff-related risks? Visit our “Tariffs and Your Contracts” series home page here.
For insights on other trending supply chain topics and to get to know our supply chain team, visit Foley’s Supply Chain Team page.
