For decades, the relationship between a hospitality operator and a brewery was one of legal inequality. Contract law was based on the principle that two professional companies know perfectly well what they are signing. In practice, however, an economically powerful brewery submits a complex, legally rigged ‘standard contract’ to a (start-up) operator, who is often in a vulnerable position and in need of capital. The message was “sign by the cross.”.
Those days are over. Recent and fundamental changes in Belgian business and contract law have given the hospitality operator a powerful legal shield. You are no longer supposed to simply accept any clause, no matter how unreasonable.
The rules in the Code of Economic Law relating to B2B contracts and the introduction of the new Book 5 in the Civil Code (on obligations) have fundamentally changed the rules of the game. They provide concrete tools to combat unfair, unclear or unbalanced clauses in your brewery contract challenge. Below we explain how this modern protection works in Belgium.
The first protection: The pre-contractual information duty
Even before the rules on unfair B2B clauses apply, your protection begins before signing. A brewery contract may be legally considered a “commercial cooperation agreement” in certain cases.
Articles X.26-X.33 of the Code of Economic Law impose a strict pre-contractual information requirement on the party granting the rights (the brewery).
- What does this mean? The brewery must provide the operator with a draft of the contract, along with a document summarizing specific contractual provisions, at least one month prior to signing.
- What is the goal? This one-month ‘cooling off’ period is intended to give the operator a chance to study the contract thoroughly (or have it studied), understand the financial implications and, crucially, seek legal advice.
- What is the sanction? If the brewery does not (correctly) comply with this duty of disclosure, the operator can invoke the nullity of the contract. This is an extremely powerful weapon if you have been pressured to sign quickly.
The bottom line: The rules for B2B contracts
The rules relating to contracts concluded between enterprises (Article VI.91/1-VI.91/10 of the Code of Economic Law) is the center of gravity of modern protection. It applies to all contracts between “enterprises,” so also between a brewery (NV or BV) and a hospitality operator (sole proprietorship or partnership).
The law has one central purpose: any term that, whether combined with other terms or not, creates a “manifest imbalance” between the parties' rights and obligations is unlawful.
The sanction is clear: any illegal clause is prohibited and void. The clause is removed from the contract, but the rest of the agreement (e.g., the loan, the lease) basically remains as is. The law provides for three levels of control.
1. The general open standard: the “manifest imbalance”
This is the general catch-all provision. Even if a clause is not explicitly on one of the lists (see below), it can still be considered unlawful if it manifestly upsets the contractual balance. This looks at all the circumstances surrounding the conclusion of the contract, the clarity of the clauses and the general economy of the contract.
2. The “blacklist”: always prohibited
The law contains a ‘black list’ of clauses that are so problematic that they are always and in all circumstances prohibited and void. A brewer can never justify why such a clause would still be valid.
Relevant examples for brewery contracts:
- Irrevocable commitment: A clause that binds you as an operator immediately and irrevocably, while the brewery still gives itself an (unreasonably) long time to confirm or not confirm the contract.
- Unilateral right of interpretation: A clause stating that “the brewery has the sole right to interpret the meaning of this contract.”.
- Waiver of claim: A clause that makes you waive in advance any possible legal remedy (e.g., “the operator waives any right to claim the termination of the contract, even in case of serious fault of the brewery”).
- Irrefutable evidence: Clauses that state that you irrefutably accept certain facts (e.g., “signing the delivery note shall constitute irrefutable proof that the delivery is complete and conforming”).
3. The “gray list”: an important weapon in practice
The ‘gray list’ is the most important part. This list lists clauses that are presumed to be unfair. It is up to the brewer to provide rebuttal evidence that the clause, in the specific context of the contract, does not creates a manifest imbalance. This is a very heavy burden of proof on the brewery.
These are the most common clauses in brewery contracts that are now on the gray list:
- Unilateral change in price or conditions:
- The clause: “The brewery reserves the right to unilaterally change its prices and rates at any time.”
- The impact: This is presumably unfair. A price adjustment is only valid if the contract specifies a valid and objective reason for it (e.g., a clear indexation formula, a reference to demonstrably increased raw material prices). A ‘blank check’ to arbitrarily increase prices is void.
- Tacit renewal of long contracts:
- The clause: “This contract, entered into for 5 years, in the absence of notice 6 months before the expiration date, is tacitly renewed for another 5-year period.”
- The impact: This is presumed to be unfair. The law seeks to protect business owners from “perpetual” contracts. The brewery must show that the clause is reasonable and provides a clear termination option.
- Excessive damage clauses (penalty clauses):
- The clause: “In case of failure to meet the minimum volume to be taken, the operator shall be liable for liquidated damages of EUR 150 per hectoliter not taken.”
- The impact: This is the battleground par excellence. Such a clause is presumed to be unfair if it is manifestly disproportionate to the dammage actually suffered by the brewery. If the brewery normally makes €50 profit on a hectoliter, a €150 fine is probably unfair.
- Limitation of liability (exoneration clauses):
- The clause: “Under no circumstances can the brewery be held liable for late deliveries, nor for any consequential damages (e.g. loss of sales) resulting from this.”
- The impact: This is presumed to be unfair. The brewery cannot simply absolve itself of its own wrongdoing, especially when it comes to an essential obligation of the contract (such as... delivering liquor!).
An alternative route: abuse of circumstances
In addition to the rules on unfair B2B clauses, there is another important, related protection: the abuse of circumstances (also known as ‘qualified disadvantage’). This is now enshrined in Article 5.37 of the Civil Code.
This rule visions contracts that were unbalanced from the outset because one party took advantage of the weakness of the other.
To invoke this, the hospitality operator must prove three things:
- An apparent imbalance: There must be a clear mismatch in performance (e.g., a relatively small loan in exchange for an extremely high and unrealistic minimum volume).
- A weak position: The operator must have been in a position of “qualified disadvantage.” This may be due to financial distress, ignorance, inexperience or the urgent need for a loan or pledge.
- Abuse: The brewery must have been aware of this weak position and deliberately exploited it to enforce the unbalanced contract.
What is the sanction? This is a crucial difference from the regulation of B2B contracts. Instead of mere nullity of the clause, the court can modify the contract. For example, the court can reduce an unreasonable minimum volume, moderate a penalty, or shorten the term of the contract. In extreme cases, the complete nullity of the contract can be pronounced.
Conclusion
The legal landscape has fundamentally changed in Belgium. The “standard clauses” in a brewery contract are no longer set in stone. Thanks to the pre-contractual information obligation, the rules on unfair B2B clauses and the doctrine of abuse of circumstances, you have concrete weapons to defend yourself.
- A clause that denies you the right to contest prices is void.
- A clause that imposes an excessive penalty on you for a small deficit is presumptively void.
- A contract you signed in an emergency that is obviously unbalanced can be modified by a judge.
This means you have a much stronger position both when negotiating a new contract and when executing an existing one.
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