New Sales Law comes into effect on 1.1.2022

Why are the changes so significant?

The sales law, as introduced on 1 January 2002, has been updated several times in the last 20 years. Unlike in the past, however, it will now undergo considerable modifications and comprehensive new regulations as of 1 January 2022, which are of great importance for both companies and consumers.

The most important changes at a glance:
  • Introduction of a new product category of Digital Products
  • Update obligations for Digital Products
  • Tightening of the definition of a defect to the detriment of the seller
  • Reversal of burden of proof in favor of consumers extended to 1 year
  • More comprehensive recourse within the supply chain

The changes in detail:

  1. Introduction of a new product category of so-called Digital Products

Digital products (§ 327 BGB) are understood to be, on the one hand, digital content (data, e.g., software applications, programs, data collections, etc.), and on the other hand, digital services, e.g., contract data processing products.

Software applications, such as apps for controlling drive assistance, navigation systems, etc., fall under this new product category.

For such products, which were previously largely covered by general sales law, there are now various regulations for provision, procedures for dealing with defects, etc.

Particularly significant for manufacturers is that an update service to ensure usability is now mandatorily introduced, which does not end with the expiration of the warranty period (24 months). The seller must provide “updates” and inform about them if the update is necessary for maintaining contractual conformity (especially usability). This means: Updates must be made according to § 327f BGB for the “provision period” if such a period is defined. Without such a definition, this obligation exists for the period “that the consumer can expect for the product”. If these obligations are not fulfilled, the product as a whole is considered defective.

If you only source the products and do not program them yourself, you must make appropriate arrangements with your suppliers to fulfill this obligation.

  1. Package contracts

If a product contains software without which the product cannot be used, the law on digital products applies to the software, especially the obligation to provide updates and announce them.

On the other hand, for the other product, called “goods” from January 1, 2022, the general sales law in its then current version applies.

  1. Changes to the definition of defects

Under previous law, the contractual agreement on quality took precedence over usual quality.

This precedence is now abolished. From January 1, 2022, the following applies:

The buyer can rely on the contractual agreement on quality, as before. In addition and cumulatively, the goods must also meet the usual quality of goods of this type.

The precedence of the contractual agreement is thus largely abolished.

This also means that it may be significantly more difficult to sell so-called B-goods legally secure. At least to consumers, B-goods cannot be sold without further ado without fearing that they can claim these B-goods as defective. One must communicate the specific errors and defects of such B-goods much more offensively and, above all, verifiably in the contract with the consumer. Otherwise, there is a risk that the consumer will purchase the goods at a favorable price and then complain about the defects.

For goods that also require digital components for operation, such as the control software for EPAC or for electronic switching, the regulations for package contracts apply: In particular, a free update service must be provided for the software.

  1. Extension of the reversal of burden of proof

The duration of the reversal of burden of proof, i.e., the time during which it is presumed that a defect that appears was already present initially, is extended to 12 months.

  1. Facilitations in recourse within the supply chain

The recourse within the supply chain up to the manufacturer of the final product is facilitated and expanded. Although it still applies that the defect must have been present, the deadlines for recourse are extended to up to 6 months after the expiry of the warranty period between the last seller and the consumer. Various other tightened regulations to the detriment of businesses are present, e.g., regarding the drafting of guarantee statements. For businesses, this means that both the terms of sale and the purchase contracts must be reviewed, the latter especially with regard to possible update obligations for digital products, but also, for example, regarding recourse options in case of consumer recourse.