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Procurement basics

What standard contract clauses protect against

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Photo: Courthouse Square, Owego, New York - 20220206 by Andre Carrotflower (CC BY-SA 4.0), via Openverse

Standard contract clauses build consistent protection into every procurement contract an organisation signs, covering issues such as termination rights, liability limits, confidentiality and dispute resolution, rather than leaving each individual contract to negotiate these fundamental terms entirely from scratch every single time a new agreement is drawn up.

Anti-corruption clauses specifically are increasingly standard, requiring a supplier to warrant that no bribe or improper payment was made to secure the contract, and giving the buyer the right to terminate immediately if that warranty is later found to be false. These clauses give a legal remedy that might not otherwise exist.

Consistent use of standard clauses also protects an organisation from an individual negotiator inadvertently agreeing to unfavourable or risky terms under pressure from an eager supplier, since deviations from an approved standard clause typically require separate, documented approval before they can actually be included in a signed agreement, long after the specific individuals involved have moved on entirely.

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