Contract formation

Good faith in negotiating

Is there an obligation to use good faith when negotiating a contract?

The obligation to act in good faith is a cornerstone of Swiss private law, explicitly stated in article 2 of the Civil Code. Damage caused as a result of bad-faith negotiation may lead to liabilities of the relevant party based on the principle of culpa in contrahendo.

‘Battle of the forms’ disputes

How are ‘battle of the forms’ disputes resolved in your jurisdiction?

There is no recent case law on the resolution of ‘battle of the forms’ disputes in Switzerland. According to the prevailing legal doctrine, the theory that the battle is won by the person who ‘fires the last shot’ is not supported in Switzerland. Rather, according to legal doctrine, a court should analyse both standard forms and apply those rules that are identical in substance. Where the forms provide for differing rules on a specific matter, the court would disregard both of them and apply the non-mandatory rules of the Code of Obligations (CO) instead.

In the rather theoretical case where the dispute would actually concern a fundamental provision of the agreement (such as, for example, the goods to be supplied or prices), a court would actually have to come to the conclusion that no agreement was validly reached and the alleged contract would be rescinded.

Language requirements

Is there a legal requirement to draft the contract in the local language?

The parties are free to draft a contract in whatever language they like. However, to enforce the rights under a contract before a Swiss court, it may be necessary to have it translated into an official language spoken at the seat of the competent court (German, French or Italian, depending on the relevant place of jurisdiction).

Online contracts

Is it possible to agree a B2B contract online?

For supply contracts, Swiss law does not require adherence to a particular form. In theory, even oral contracts are valid. From a practical perspective, it is important to be able to prove the content of the agreement. For a click-to-accept process, the relevant question would be whether the exact terms ‘accepted by click’ can technically be demonstrated in court, which may prove cumbersome.