Quality guarantee

What it means

A quality guarantee is a voluntary commitment by a seller, contractor or manufacturer that goods or work delivered will, for a set period, be fit for the agreed or usual purpose and retain the agreed or usual properties. In business relationships it is governed by the Commercial Code for the purchase contract and similarly for the contract for work.

Unlike statutory liability for defects, which covers defects existing when risk passes, a quality guarantee also covers defects that appear later during the guarantee period. It also shifts the burden of proof: the seller must show it did not cause the defect, for example that the buyer caused it through misuse.

A quality guarantee arises only if the parties agree it in the contract or the seller or manufacturer gives it unilaterally, for instance in a warranty certificate or on the packaging. The parties can set its length, scope and conditions, such as a requirement for regular servicing or the exclusion of normal wear and tear.

How it works in practice

When buying machinery, technology or construction work, we recommend negotiating a quality guarantee explicitly. The contract should set the length of the warranty period, when it starts, what it covers, deadlines for reporting and remedying defects, and what happens if the supplier fails to remedy a defect in time. A guarantee is often combined with a retention, holding back part of the price.

As a supplier, a company should offer guarantees thoughtfully. A long guarantee is a commercial advantage but means future costs, for which a warranty provision is created. The conditions should be clear so that complaints can be judged unambiguously, for example whether the prescribed servicing was carried out.

In a supply chain, where a company buys a product and resells it, it is important that the supplier's guarantee covers at least what the company gives its own customers. Otherwise the company bears the difference itself. In contracts with foreign suppliers, the governing law and dispute resolution method also need attention.

What to watch out for

The most common mistake is confusing a quality guarantee with the consumer warranty period. In business relationships there is no automatic two-year warranty, and without an agreed quality guarantee only statutory liability for defects with short notification deadlines remains. Many companies discover this only in their first dispute.

Watch for conditions that hollow out the guarantee in practice, such as an obligation to service exclusively with the supplier at high prices or broad exclusions. When reviewing a contract, read not just the guarantee length but also the circumstances in which it lapses. Deadlines for reporting defects must also be met, or the claim is lost.