What general terms and conditions are for
General Terms and Conditions, short GTC, also just «General Terms», are contractual clauses that a party formulates and applies generally to all its business relationships or at least to a specific business area. Thus GTC serve on the one hand to rationalise, but for smaller companies GTC can also serve as a checklist: once you have formulated your General Terms, perhaps with the help of a lawyer, you no longer have to ask yourself what you should agree on every time you conclude a business transaction. GTC also have an important function in negotiations: if you enter into contract negotiations with your own ready-made clauses, you have a good chance of enforcing them (contract dominance), if only because many people think that GTC cannot be changed. The latter is of course not true: GTC can always be changed by individual agreements.
Two special rules: ambiguity and unusualness
From a legal point of view, it is even assumed that the other party does not read the GTC, or reads them but does not understand them. For this reason, two special rules apply to GTC. The ambiguity rule is based on the principle of good faith (Art. 2 CC) and is generally applied in contract law: ambiguous clauses, in this case in the GTC, are interpreted in favour of the party who must adopt the GTC and to the disadvantage of the party who uses them (Latin: in dubio contra stipulatorem). The rule of unusualness states that provisions in the GTC are not binding on the other party if that party did not have to expect a provision that is unusual for the respective transaction. Since 2012, Swiss law also declares abusive clauses in consumer GTC unfair (Art. 8 Unfair Competition Act), but the courts apply this provision rarely; in practice, the two rules above decide. Most legal systems apply similar rules based on good faith, and many go further with specific statutes on standard terms, especially for consumers; check the rules of the country whose law governs your contract.
Presentation before conclusion, battle of the forms
Logically, GTC must be presented before the conclusion of a contract (Art. 1 CO). It is best to attach the GTC to the offer; presenting them together with the invoice would clearly be too late. Nowadays, it often happens that both parties have their own GTC which they want to apply. This is not advisable: the so-called «battle of the forms» can occur if the GTC are contradictory. The solution is to take one set of GTC and to adapt it in an individual contract to the acceptable wishes of the other party.