Home > Countries > Germany > Cross-border purchase or repair of boats
Cross-border purchase or repair of boats

Cross-border purchase or repair of boats

Trading relationships between Germany and the Netherlands are very close. This applies to many sectors and markets, including boat and shipbuilding. Since Dutch boatbuilders have a good reputation in Germany, many Germans have their boats built or repaired in the Netherlands. The Dutch coast is also popular with people from Germany, so many Germans keep their boats in the Netherlands, hire a berth and leave it there over the winter. Experience shows that it is very important to put the contractual agreements down clearly in writing so as to manage expectations on both sides and avoid conflicts and differences of opinion in future. This article sets out which law applies and which courts have jurisdiction in the possible scenarios. The main aim is to be able to frame the contractual agreements as desired, within the scope of the legal possibilities.

Applicable law
Buying an existing boat involves a purchase contract. When a German consumer buys a boat from a Dutch business person, the following applies: in principle, the parties can agree which law applies to the purchase contract. This must be specified in the purchase contract in writing. However, the choice of law must not lead to the consumer losing the protection which would have been afforded them under the objectively applicable law (the law that would apply according to the statutory provisions if no law were chosen). In this case, the objectively applicable law would be German law (that of the country in which the consumer has their habitual residence) provided that the Dutch business person carries out their professional activity in Germany or else targets their activity at Germany. Such targeting requires active, deliberate action on the part of the seller of the boat. If the Dutch seller does not actively target their activities at the German market, and if they do not carry out their activities in Germany either, objectively speaking, the law of the country in which the seller is based applies, i.e. Dutch law. Since Dutch boatbuilders often carry out their activities exclusively in the Netherlands, this consumer protection regulation will not normally apply, so that Dutch law is applicable.

If the Dutch business person sells a boat to a German business person who acquires the boat in their professional capacity (i.e. not as a private individual), either the contractually agreed law applies, or in the absence of such agreement, Dutch law applies (the law of the country in which the seller is based). It should also be pointed out here that the UN Sales Convention does not normally apply to the purchase of seagoing and inland vessels.

In the case of a purchase contract where the parties do not agree on the choice of law, in many cases, Dutch law will be applicable.

If the German buyer commissions a Dutch boatbuilder to build their boat, this constitutes a contract for work and services. If the Dutch boatbuilder then carries out their activities (boatbuilding) in the Netherlands, the above statements concerning the purchase contract apply. If the Dutch person builds the boat in Germany, German law would be applicable.
The same applies to the repair of a boat.

Jurisdiction
The question also rises of which courts will rule on the proceedings in case of a dispute. The parties can agree this in the underlying contract too. However, an agreement regarding jurisdiction is only effective against a consumer if it was agreed on after the dispute arose. This is unlikely in most cases. Therefore, in the case of a contract with a consumer: The German consumer can choose whether to issue proceedings against the Dutch business person at the place of residence of the German consumer or at the registered office of the Dutch business person. On the other hand, the Dutch business person has no choice: they must bring their action before the court with jurisdiction over the registered office of the German consumer.

If both parties to the contract are business people and also enter into the contract in a professional capacity, the parties can make a choice of law. In this case, it should also be borne in mind that the applicable law and competent court must come under the same legal system, i.e. German law and German court or Dutch law and Dutch court.

If the parties (business people) have not agreed on a forum, the court of the place in which the contractual obligation was to be fulfilled has jurisdiction. Unless otherwise agreed in the contract, in the case of a purchase contract, this is the place at which the boat was to be delivered, and in the case of the contract for work and services, the place at which the service (building or repair) was to be provided.

Summary
As stated, the parties are free to agree on the law applying to the contract in question. This law will then govern the contractual relationship. Where a German consumer enters into a contract with a Dutch party, in certain situations, mandatory provisions of German law may also come into play to protect the German consumer. However, this will often be thwarted by the fact that the Dutch boatbuilder carries out their activities in the Netherlands.

The applicable law can then be determined by contractual agreement. If this is not the case, the law of the country in which the seller is based or the contractor carries out their activities normally applies.

In the case of contracts with consumers, it will normally be the case that Dutch law is applicable but the German consumer can bring an action before a court in Germany or the Netherlands. In the case of contracts with business people, in the absence of a choice of forum clause, the place of performance or delivery should be specified.

Share and Enjoy:
  • Print
  • del.icio.us
  • Facebook
  • Twitter
  • email
  • Google Plus
  • LinkedIn
  • PDF

Scroll To Top