- Intellectual Property Rights
- Production and Quality
- Controls and checks
- Ownership and Risk
- Price and Payment
- Governing Law
These Conditions apply to the supply of Own Brand Products (“Products”) which includes any products for which ASW sets out stipulations regarding the composition, design and packaging, and/or to which ASW attaches any of its brand marks, trade names or other distinguishing features.
- “ASW” means A.S. Watson (Europe) Group AG, and its affiliated companies who wish to purchase Products pursuant to these Conditions.
- “ASW Trademarks” means the trademarks, copyrights, trade names, own labels, symbols, logos, design and design rights owned by ASW, together with such other trademark or trade names as ASW may from time to time register, adopt or use.
- “Code of Conduct” means the Business Social Compliance Initiative (BSCI) code of conduct for suppliers.
- “Contract” means each agreement in any form for the purchase of Products by ASW.
- “Formulation” means the bespoke formulation for the Products created for ASW including the list and composition of ingredients of the Products (including, if applicable, the INCI formula).
- “Labelling” shall mean the labels, the stickers or the statements which shall be affixed directly onto the Product and/or on its Packaging and which shall comprise mandatory legal statements as well as any marketing claims.
- “Packaging” shall mean the primary packaging (bottle, tube, pot, packet, etc.) and/or the secondary packaging of the Products (external packaging, over-packaging etc).
- “Packing” shall mean the conditions and criteria to be complied with for packaging the Products with a view to dispatching them from the Supplier for delivery to ASW.
- “Production” shall mean the development of the Formulation, the industrial production, the Packing, the quality control and the traceability of the Products.
- “Purchase Order” means ASW and its Affiliates and Business units written instruction to supply the Products, whether placed by formal purchase order, EDI or other written communication.
- “Specification” shall mean the documents which contain, for each Product, a description of the Formulation, the Packaging, the Labelling and the Packing, as well as the criteria of quality and traceability of the Product.
- “Supplier” means the company, firm or person supplying Products to ASW hereunder.
- These Conditions shall apply to each Contract to the exclusion of any previous agreements understandings or representations between the parties. The applicability of any other conditions proposed or stipulated by the Supplier in any form, whether written or oral, is hereby expressly rejected.
- Once a Purchase Order from ASW is accepted by the Supplier (whether expressly or impliedly) a Contract is deemed to have been concluded incorporating these Conditions. If there is no reaction by the Supplier within five working days of the date on which the Purchase Order is placed, the Purchase Order shall be deemed to have been accepted.
- No change to these Conditions or the Purchase Order shall be binding unless agreed in advance and in writing by an authorised signatory of ASW.
- Failure by ASW to demand strict compliance with these Conditions shall not be construed as a waiver of any such Conditions and shall not affect the validity of, or ability to enforce any of the provisions thereof.
- In the event that any of the provisions of these Conditions become or are found to be invalid or unenforceable, this shall in no way impair or affect any of the other provisions, all of which shall remain in full force and effect.
- In the event of any conflict or ambiguity, the order of precedence for any Contract shall be as follows: (1) the Purchase Order; (2) the Supply Agreement for Own Brand Products between the Supplier and ASW; (3) these Conditions.
- The Supplier undertakes that the Specification shall comply with ASW’s instructions, as well as with all applicable legal stipulations.
- The Supplier shall, upon ASW’s request provide ASW with a detailed breakdown of the quantity and identity of the ingredients, country of origin of ingredients and details of raw materials suppliers, and any other information requested by ASW regarding the composition of the Products, unless restricted from doing so by law or regulatory authority.
- The final Specification must be accepted in writing by ASW prior to the start of Production. This shall not relieve the Supplier from its sole responsibility for the quality of the Products.
- The Supplier shall also provide samples of the product design or Packaging as requested by ASW. The Supplier shall ensure that the final produced Products adhere to the agreed samples. Any deviations will entitle ASW to reject and return the Products unless the deviations have been explicitly accepted, in writing, by ASW.
- Modifications to the Specification shall be allowed only after prior written approval by ASW.
- The Supplier undertakes not to use the Specifications for any purpose, other than the discharge of its obligations to supply the Products in accordance with these Conditions.
- The Supplier shall guarantee the exclusivity of the Products. In this respect, the Supplier shall not produce or supply any products to third parties with the same Formulation and/or design as the Products unless otherwise expressly agreed by ASW in writing.
- ASW shall provide the Supplier with the artwork of all Packaging and Labelling. Costs for production of packaging material, lithography, agency, preparation of print etc. will be paid by the Supplier. The Supplier shall pay the costs for one change of Packaging/Labelling per year in connection with a re-launch.
3. Intellectual Property Rights
- All intellectual property rights, or rights that rank on a par with these, to the Products (including the Formulation, the Labelling and Packaging) and any drawings, images, templates, samples or other materials provided by ASW to the Supplier, or provided by the Supplier as commissioned by ASW, belong to ASW.
- Notwithstanding Clause 3.1, to the extent the Supplier provides its own formulation, or any other designs or materials created independently prior to, or otherwise than in connection with, the Contract (referred to as “Supplier Background Materials”), the Supplier retains the intellectual property rights in such Supplier Background Materials and grants to ASW a world wide, perpetual, non-exclusive, non-transferable, irrevocable, royalty free licence to use, reproduce, modify, alter or integrate the Supplier Background Material in connection with the Products and in respect of ASW’s rights and obligations hereunder.
- The Supplier recognises that all current and future intellectual property rights relating to the Products and the materials referred to in Clause 3.1 belong to ASW. In so far as these rights have not yet vested in ASW, the Supplier shall hereby transfer these rights to ASW. If these rights are not yet transferable, the Supplier shall transfer them as soon as possible and in the interim the Supplier shall grant ASW an exclusive licence to such rights.
- The Supplier shall not use materials of any kind made available by ASW, including ASW Trademarks, for any purpose other than manufacturing the Products for supply to ASW, shall not make available any such materials to third parties and shall return them promptly to ASW on request. For the avoidance of doubt, the Supplier shall not produce or supply any products bearing any ASW Trademarks for any other person whatsoever and shall not produce or supply to any person any products which infringe any ASW Trademarks, or assist any other person to do so.
- The Supplier shall not, without ASW’s prior written approval, offer for sale, sell or supply the Products (or any Packaging or Labelling bearing ASW Trademarks) to third parties under any circumstances, including if the Products do not meet the Specification, are surplus to ASW’s requirements, or if ASW has terminated the Contract relating to these Products.
- The Supplier represents and warrants to ASW that the Supplier Background Materials, and the sale, delivery or use of the Products incorporating the Supplier Background Materials, shall not infringe any patent, copyright, trade or service mark, registered design or other rights which rank on a par with such intellectual property rights. The Supplier shall be liable for, and shall fully and promptly indemnify ASW against, all costs, damages, losses and claims (including but not limited to the purchase price of the Products, costs for their destruction and legal fees) which ASW may suffer or incur as a result of any infringement or alleged infringement of such rights or any breach of the warranties in this Clause 3.6.
4. Production and Quality
- The Supplier must ensure that it complies with ASW’s Quality Assurance Guidelines and the Code of Conduct in force from time to time.
- The Supplier hereby warrants to ASW that:
- The Products shall conform in all respects with the Specification, are fit for the purpose intended or arising from the nature of the goods, are safe and are not defective;
- The Products, including Labelling and Packaging, and the Production and Packing processes, are of good quality and comply in all respects with all relevant laws, regulations and industry standards in force from time to time, both of country of origin and specified destination.
- Where required by relevant laws, regulations or industry standards, the Supplier shall provide the Product Information File in full to ASW for review before delivery of the Products. In the event the Supplier requires an external review for confidentiality reasons, the Product Information File shall be provided to an independent third party appointed by ASW who will review it on behalf of ASW and any cost associated with such external review will be paid by the Supplier.
- The Supplier shall carry out (at its cost) its own quality control checks and batch monitoring and shall take product samples from every production batch. Supplier shall retain these samples and all its quality inspection reports for at least 24 months after production, or if longer, for the period of the shelf-life of the Product, and shall make these available to ASW on request.
- All Products which have a shelf-life, must be delivered to ASW with at least two thirds of their shelf-life remaining.
- Supplier is responsible (at its cost) for any registration formalities and mandatory declarations in respect of the Product and its Packaging, with local government or other regulatory authority and must provide all relevant documents and samples on request by ASW.
- The Supplier shall be solely responsible for the quality control of the Products, including inspection of the Products (including the raw materials used to produce the Products), of their Packaging and of the Packing process.
- The Supplier further warrants that it has, and shall at all times during the Contract have, adequate product liability insurance in respect of its potential liabilities hereunder, with a reputable insurance company. Copies of relevant insurance policies shall be provided to ASW on request.
- In the event that either party receives any complaints in respect of the Products or any claims, investigations or enquiries by any regulatory authority or enforcement body, it shall immediately notify the other.
- If ASW is obliged by law, or otherwise deems it necessary in its reasonable opinion, to take measures to withdraw from sale or recall the Products, the Supplier shall be liable for all costs, damages, losses and claims incurred and sustained in connection with such measures, including but not limited to advertising costs, recovery and destruction of the Products. If the Supplier becomes aware of any circumstances which may lead to a recall of Products due to health, hygiene, safety or other reasons, then the Supplier must notify ASW immediately.
- The Supplier shall fully indemnify ASW and hold harmless against all costs, damages, losses and claims which ASW may suffer or incur as a result of Supplier’s breach of this Clause 4.
- The Supplier acknowledges that any forecasts or projected sales data provided by ASW does not constitute a firm commitment by ASW to order such quantities from the Supplier until a Purchase Order is issued.
- Notwithstanding Clause 5.1 above, Supplier is responsible for maintaining a minimum stock cover of Packaging and finished Products, as reasonably specified by ASW from time to time. ASW will not be responsible for any stock or components in excess of such minimum stock cover.
6. Controls and checks
- Access to production and distribution facilities shall be given to ASW, or its designated representatives, upon reasonable notice, for inspection of the Products during Production, Packing and/or storage to ensure that they comply with the Specification, applicable legal stipulations and meet all applicable safety and other relevant requirements.
- ASW shall be entitled to have controls carried out at least once a year and whenever ASW deems it reasonably necessary, on both the production facilities (‘inspection’) and the products purchased (‘post-market surveillance’), by an independent research institute or other third party accredited body. Inspections shall focus on the Supplier’s production processes and quality assurance management to ensure they meet industry standards and comply with the Code of Conduct. Post-market surveillance shall focus on products on shelves in ASW stores, to ensure the agreed Specification, quality and safety have not been altered since the first delivery of the Products.
- The costs of these controls shall be notified to the Supplier in advance and shall be for the account of the Supplier.
- If the results of the controls show, or if at any other time it appears, that the Products, or the Production or Packing, do not comply with the Specification, or any other provision of these Conditions, ASW shall inform the Supplier of this immediately and the Supplier shall promptly take all necessary measures to ensure that the Products, Production or Packing meet the requirements, without prejudice to ASW's right to terminate the Contract or to claim compensation.
- Manufacturing site(s) for the Products will be identified to ASW and approved by ASW in writing in advance and may not be altered by the Supplier without prior written approval of ASW.
- The Supplier shall establish and agree a disaster recovery plan with ASW, which shall be complied with in relation to the manufacturing site(s).
- The Supplier shall deliver the Products to ASW at the location, or locations, stated in the Purchase Order, or otherwise specified by ASW.
- The Supplier shall deliver the Products on the date and time specified in the Purchase Order or otherwise specified by ASW. Time for delivery shall be of the essence, and therefore if the delivery deadline is not met the Supplier shall immediately be in default, without any proof of default being required, and ASW shall be entitled to refuse the Products.
- The Supplier shall immediately notify ASW in writing of any circumstances that may result in a delay to the delivery of the Products by the agreed delivery date (specifying the reasons and expected duration of delay). The Supplier undertakes to do everything possible in order to make up this delay, at its expense.
- In case of late delivery, ASW shall be entitled to charge late fees amounting to 1% of the invoice value of the late consignment per day of delay, notwithstanding any damages that ASW may also claim for losses incurred by it due to the delay.
- The Supplier shall deliver the Products in accordance with any other local logistical conditions specified by ASW from time to time.
- Receipt of the Products or a signature for receipt by ASW shall not constitute recognition of good quality of the Products received, nor recognition of the accuracy of the quantities stated on the delivery or packing note.
8. Ownership and Risk
Full and unencumbered title to, and risk in, the Products shall pass to ASW upon delivery, in accordance with the relevant international trade term (Incoterm) stipulated in the Purchase Order (if any), unless payment is made prior to delivery in which event title shall pass on payment.
9. Price and Payment
- The price for the Products shall be as specified in the Purchase Order and in accordance with the relevant international trade term (Incoterm). Unless otherwise agreed by ASW the price is inclusive of all transport and insurance charges and any other applicable taxes, duties and levies, except for VAT.
- Payment shall be made in accordance with the payment term stipulated in the Purchase Order or otherwise agreed by the parties, following receipt of the Supplier’s valid invoice (quoting the Purchase Order number) or the receipt of the delivery of the Products, whichever is the later, except where ASW raises an objection in good faith (whether as to the amount invoiced or the Supplier’s performance or where ASW returns the Products to the Supplier pursuant to these Conditions).
- Payment shall not constitute any recognition by ASW as to the quality of the Products and shall not absolve the Supplier from liability in this regard.
- ASW shall at all times be entitled to set off any amounts owing to the Supplier, whether or not due and payable, against amounts which the Supplier owes to ASW.
- If any Products are in any way defective or do not comply strictly with the Specification and these Conditions, or if the Supplier fails to comply with any of its other obligations hereunder, this shall constitute a breach of the Contract. The Products may at ASW’s discretion be rejected and ASW may require that the Products are replaced by the Supplier at the Supplier's cost, and ASW shall be entitled to recover damages in respect of such losses which ASW has incurred as a result of the breach or defect.
- Without prejudice to any other right or remedy available to ASW, the Supplier shall fully indemnify ASW and hold harmless against all costs, damages, losses and claims which ASW may suffer or incur as a result of claims by third parties arising from any defect in the Products.
- If either party (“defaulting party”) (i) is unable to pay its debts as they fall due, or (being an individual or firm) becomes bankrupt, or (being a company) is subject to an administration order or goes into liquidation, or a receiver is appointed of all or any part of its assets, or the defaulting party takes or suffers any other similar action in consequence of debt, or otherwise ceases or threatens to cease to carry on business, or (ii) experiences a change of control which may materially impact its ability to perform its obligations; or (iii) commits a persistent or material breach of its obligations hereunder; or the other party (“non-defaulting party”) reasonably apprehends that any of the events mentioned in this Condition is about to occur (and notifies the defaulting party accordingly) then, without affecting any of the non-defaulting party’s other rights or remedies the non-defaulting party is entitled to terminate the Contract, or suspend any Purchase Order without incurring liability.
- In the event that Supplier intends to terminate Production or otherwise cease supply of the Products, a minimum of six (6) months’ notice in writing must be provided to ASW.
- The Supplier shall not without the prior written consent of ASW (i) assign the Contract to any third party or (ii) or sub-contract its obligations to any third party.
- The Contract will only confer rights and benefits on ASW and the Supplier, and no third party will acquire any rights or benefits under the Contract.
- Neither party shall disclose to third parties any confidential information relating to the other party, including prices and sales figures, the Specification and any other technical or commercial details or information which has been obtained in connection with the Contract, unless such disclosure is required by law or regulatory authority. This obligation of confidentiality shall survive the termination of the Contract, and will expire only as and when the information has fallen into the public domain, through no fault of the other party.
- ASW shall have the right to amend these Conditions from time to time on giving reasonable written notice to the Supplier.
- Neither party shall be liable for delay in performing, or failure to perform, any of its obligations hereunder if such delay or failure result from events, circumstances or causes beyond its reasonable control, such as Acts of God (including flood, earthquake, or other natural disaster), war or other conflict, civil commotion, terrorist attack, or governmental action. If the period of delay or non-performance continues for more than sixty (60) days, either party may terminate this Agreement by immediate written notice to other party.
- Nothing in these Conditions is intended to, or shall be deemed to, establish any partnership or joint venture between any of the parties, constitute any party the agent of another party, nor authorise any party to make or enter into any commitments for or on behalf of any other party
- The Supplier shall, and shall procure that its agents, directors, employees, officers and sub-contractors shall, (i) not engage in any form of bribery, corruption, extortion or embezzlement, or other unlawful conduct; (ii) comply with all applicable laws, regulations, codes and sanctions relating to anti-bribery and anti-corruption (“Anti-Bribery Laws”); and (iii) have and maintain in place throughout the term of supply, adequate policies and procedures to ensure compliance with the Anti-Bribery Laws.
13. Governing Law
Each Contract incorporating these Conditions shall be governed by and construed in accordance with the laws of the country in which the Products are to be delivered to ASW, or otherwise expressly agreed, and the parties irrevocably submit to the exclusive jurisdiction of the courts of such country.