Customer Compensation Contract

A Customer Compensation Contract is a specialized legal document in foreign trade that addresses the after-sales repair phase, stipulating that the supplier shall compensate the customer for losses caused by product quality or repair service issues. It is commonly used in industries requiring long-term after-sales support, such as mechanical equipment and electronic products. Usage scenarios include: customer equipment failure leading to production stoppage, repair delays causing additional losses, and equipment still not functioning properly after repair. Precautions: clearly define the scope of compensation (direct losses, indirect losses, loss of profit), compensation cap, claim time limit, exemption clauses (e.g., force majeure, improper customer operation), and dispute resolution methods. Unlike quality assurance clauses in general sales contracts, this contract focuses more on compensation liability during the repair phase rather than quality objections at product delivery; compared with after-sales service agreements, it emphasizes economic compensation rather than service content. It is recommended to specify the compensation calculation method (e.g., daily production stoppage loss) and payment deadline in the contract, and ensure alignment with the main contract to avoid conflicting clauses.