A commercial  contract establishes the terms of any legal business transaction between two companies ( including Autonomos).

When preparing a commercial contract, make sure that it includes at least the points listed here.

The Different Types of Commercial Contracts

Typical business agreements involve:

• The sale of goods, either retail products or parts
• The provision of services, including vendor services or outsourcing of services
• The use of intellectual property, such as patents, copyrights, trademarks and trade secrets
• A party’s right to disclose confidential information or to engage in competition
• The purchase or lease of real property

It is ruled by the Civil Law and differs from the employment contract, not being subjected to the same requirements and legislation.

What should it include?

• Identification of the parties:  It should be obvious which two companies are agreeing on the clauses of the contract. In cases when an individual signs on behalf of a company, it is wise to state the basis for which he is authorized to represent the company. (For instance, the director of a S.L company upholds his office by virtue of the incorporation document of such date, signed in such notary).
• Service to provide. In this case, the rule is “the more specific, the better”. Loopholes in the service specification is a frequent cause of disputes. Beware of services that might be taken for granted by one of the parties. For example, after the completion of construction work, who will do the cleaning?. This might not be understood as part of the service by the builder but it is assumed by the contractor.
• Duration of service. Project-oriented contacts are extinguished when the works are completed. In such case, it would be beneficial including a deadline. If it is a type of service that extends indefinitely it is advisable to reflect the causes that would finalize the contract.
• Economic compensation. This includes prices, payment methods, dates, etc…
• Conditions. As mentioned earlier, in order to avoid misunderstandings it is important to be specific. Comments on the standard of the services, quality of materials, etc..It is also important to cover a number of “what-if” situations.  If the deadline is not met, if the payment is not done within the agreed time, if extra services are requested afterward, etc.
• Breach of contract. Both parties should be well informed of what would be the consequences of failing to fulfill the contract.

  

• Signatures. Vital indeed.Signatures validate the contract.

Contracts involving Economically Dependent Autonomos.

An economically dependent autonomo is the one who obtains more that 75% of his income from one single client. 

This should not be confused with the illegal form of Fake Autonomo. 

The relationship between an economically dependent autonomo and his client must be put in a contract which needs to be registered.

The contract must include at least the following:

• The identification of the worker and the client.
• The object and cause of the contract. What the worker is contracted for, and the basic conditions of the work to be carried out.
• The annual, weekly and public holiday breaks. The 18 days of annual leave can be improved by contract.
• The maximum duration of the working day, in weekly, monthly or annual calculation.
• It must be clearly and specifically stated that the worker is economically dependent on the client.

During the duration of the contract, it is possible to work more than what is stated in the contract. You can voluntarily work longer than the agreed working hours as long as it does not exceed the maximum increase set out in the professional interest agreement. If this agreement does not exist, the limit will be 30% of the ordinary working time.

Is a contract in English binding in Spain?

Yes. This does not mean that you will not need to provide a translation if you need to present the contract before some authorities.  But certainly, contracts written in English can be reinforced in Spain too.