Selling to businesses? What to sort out in the customer contract

Between businesses almost everything in a contract is up for negotiation: the law assumes both sides are professionals and protects them far less than it protects consumers. There are, though, things you cannot agree away, for example you cannot limit in advance your liability for intent or gross negligence (Art. 94 ZZD), and rules that work in your favour, for example statutory interest and at least EUR 40 in compensation when a customer pays late (Art. 309a TZ).

This article is about the startup as the seller: you sell software, a service or development work to another company. The other side, when you are the buyer, is in our article on supplier contracts. If you sell to consumers, extra rules apply, collected in our B2C compliance checklist. If the deal is still only verbal, see whether a verbal agreement counts and how to prove it.

Throughout, we separate what the law says (with the article cited) from what is only a common negotiating position. All amounts are in euro.

1. What the law decides and what you decide

The parties can freely set the content of their contract, as long as it does not conflict with the mandatory rules of law or with good morals (Art. 9 of the Obligations and Contracts Act, ZZD). A contract that conflicts with the law, circumvents it or offends good morals is void (Art. 26(1) ZZD). As a rule, the nullity of a single clause does not bring down the whole contract (Art. 26(4) ZZD).

When you sell to a company, the Consumer Protection Act does not constrain you: there is no unfair-terms review, statutory withdrawal right or consumer warranty. So anything you want to apply has to be written down. The law requires both sides of a commercial deal to act with the care of a good merchant (Art. 302 of the Commerce Act, TZ), a higher standard than the one for an ordinary individual.

2. What kind of contract you are actually signing

The type of contract decides which rules apply to anything the contract leaves out. The content decides, not the title.

• Custom development. When you undertake, at your own risk, to make something to the customer's order for a fee, this is a contract for work (Art. 258 ZZD). The customer must accept the work, inspect it and raise its objections. If it doesn't, the work is treated as accepted, except for defects an ordinary inspection could not reveal (Art. 264 ZZD). For defects, the customer can ask for a repair, the cost of it or a lower price, and for serious defects it can terminate the contract. These rights lapse after six months (Art. 265 ZZD).
• Consulting and support. Here you usually owe care and effort rather than a particular result. Exactly what you owe depends on how the scope is described.
• Licences and SaaS. When you give access to an existing product, the customer gets a right of use and ownership stays with you. SaaS has no statutory regime of its own: the contract combines a service and a right of use, so it matters that it describes both.

For long relationships practice uses two layers: a framework agreement with the general terms (liability, confidentiality, rights, governing law) and separate statements of work with the scope, deadlines and price of each project. It helps if the framework agreement says which document prevails in a conflict.

3. Scope, acceptance and changes

The scope

The most expensive disputes with customers are rarely about the law. They are about what exactly was ordered. So the scope is described concretely, usually in an annex: features, modules, deliverables, and a separate "out of scope" list. Without it, under a contract for work the customer can argue that a feature nobody wrote down "goes without saying". What such a dispute looks like in court: costly startup legal mistakes.

Acceptance

The law gives a starting point: the customer has to inspect the work and object, or it is treated as accepted (Art. 264 ZZD). For commercial deals the period for inspection or acceptance is 14 days from receipt, and a longer one can be agreed by exception, for an important reason (Art. 303a(4) TZ). If the contract provides for acceptance, the payment term runs from acceptance.

A common negotiating position is an express deemed acceptance clause: if, within a set period, for example 7 to 14 days after notice of delivery, the customer does not send a reasoned written rejection listing the defects, the result is treated as accepted. That way the final payment does not depend on a record the customer can simply leave unsigned.

Changes

Every change to the scope, price or deadline is agreed in writing, with an estimate and a confirmation from the customer. A verbal change to a written contract is hard to prove: witnesses are not allowed unless both parties expressly agree (details).

The customer's cooperation

If your work depends on access, data or feedback from the customer, the contract should say what the customer owes and what happens if it is late. A common clause extends your deadlines by as many days as the customer was late, and makes longer delays pay for the team's idle time.

Subcontractors

The customer has a contract with you, not with your freelancer: if a subcontractor is late or makes a mistake, you answer to the customer. That is why freelancer contracts usually "mirror" the customer contract on confidentiality, data and rights in the code, since you cannot transfer rights you never received. When a freelancer is really an employee is in our employment law article.

If you process the customer's personal data, you are the processor and an agreement under Art. 28 GDPR is needed (what it contains).

4. Price and payment term

The pricing model is entirely a matter for negotiation: a fixed price, an hourly rate (capped or not), a subscription or usage-based pricing. With a fixed price the risk of a growing scope is yours. So for non-standard projects an hourly rate with a monthly cap is often agreed.

The payment term is where the law steps in:

• Between the parties to a commercial deal the payment term can be up to 60 days. A longer term is allowed by exception, if the nature of the goods or service or another important reason requires it, and it is not a clear abuse of the creditor's interest and does not offend good morals (Art. 303a(1) TZ).
• If no term is agreed, payment is due within 14 days of receiving the invoice or demand for payment (Art. 303a(3) TZ).
• If the customer is a public contracting authority (a ministry, a municipality, a state hospital), the terms are shorter (Art. 303a(2) TZ) and the public procurement rules apply, which this article does not cover.

The rest is practice. An advance at the start of a project is a common negotiating position, especially with a new customer. For contracts longer than a year, annual indexation of the price to an official inflation index is often agreed. With a customer outside the euro area, the contract states the currency and who pays the bank charges.

5. The liability cap

If you don't deal with liability, you are liable under the general rule: compensation covers the loss suffered and the profit lost, as far as they are a direct and immediate consequence of the breach and could have been foreseen when the contract was made. A debtor who acted in bad faith is liable for all direct and immediate damage (Art. 82 ZZD). When a large customer's system goes down, its lost profit can be many times the entire value of your contract.

That is why limitation of liability, a maximum on compensation agreed in advance, may be the most important clause for a seller. The law sets one hard limit: any agreement that in advance excludes or limits liability for intent or gross negligence is invalid (Art. 94 ZZD). A cap can only work for the other cases.

The law gives one more protection with no clause needed: if the breach is also due to circumstances the customer is responsible for, the court can reduce the compensation or release the debtor, and damage the customer could have avoided with the care of a prudent owner is not owed (Art. 83 ZZD).

What is commonly agreed (negotiating positions, not rules of law):

• a cap equal to the amount the customer paid in the last 12 months, or a multiple of the contract's annual value;
• an exclusion of lost profit and of "indirect" damage;
• a separate, higher cap for the heaviest risks, such as a data leak or third-party claims over rights in the software, instead of unlimited liability for them.

What such a clause might sound like (an example a lawyer adapts to your deal): "The Contractor's total liability under the contract is limited to the amount paid by the Customer in the 12 months before the event that caused the damage. The limitation does not apply in cases of intent or gross negligence."

English templates exclude "consequential damages", but Bulgarian law has no identical concept: the measure is in Art. 82 ZZD, and much depends on the wording. An indemnity, where you undertake to protect the customer from third-party claims, also has no separate regime in the ZZD. It is usually set up as a stand-alone contractual obligation, so it matters that it has its own cap and says who runs the defence.

If the data terms are imposed unilaterally, the EU Data Act has its own list of invalid clauses, including excluding liability for intent or gross negligence. Professional liability insurance also covers some of these risks.

6. Penalties

A penalty (неустойка) is a sum agreed in advance for the case of a breach. It secures performance and compensates for the damage without the damage having to be proven, and compensation for greater damage can also be claimed (Art. 92(1) ZZD).

Under the general rule a court can reduce an excessive penalty (Art. 92(2) ZZD). Between merchants it is different: a penalty owed under a commercial deal concluded between merchants cannot be reduced for being excessive (Art. 309 TZ). In Interpretive Decision No 1/2009 of 15 June 2010 of the General Assembly of the Commercial Chamber, the Supreme Court of Cassation explained that this bar does not rule out a reduction where the obligation was performed improperly or only in part.

The same decision holds two more things. A penalty with no upper limit, or with no end date up to which it accrues, is not void in itself. A penalty is void for offending good morals when it was agreed outside its inherent functions of securing, compensating and sanctioning, and that is judged case by case as of the moment the contract was signed.

The practical conclusion: when you sign a penalty with another company, expect to pay it in the agreed amount. That is why, with customer templates, a common negotiating position is an overall cap on all penalties, for example a percentage of the value of the statement of work, and a date after which they stop accruing. The rule works the other way too: penalties you agree in your own favour are not reduced either.

In SaaS, penalties for downtime are often replaced by SLA credits (under the service-level agreement): a discount on the monthly fee when an uptime percentage is missed, as the only compensation. More on SLAs: supplier contracts.

7. When the customer pays late

What the law gives you

When you have done your part and the customer is late, unless agreed otherwise you are entitled to statutory interest from the day of the delay and to compensation for collection costs of at least EUR 40, without having to send a demand. Greater damage and costs can be claimed under the general rules (Art. 309a(1) TZ). A limit on this liability can be agreed only if it is not a clear abuse of the creditor's interest and does not offend good morals (Art. 309a(3) TZ).

The rate of statutory interest is set by the Council of Ministers (Art. 86(2) ZZD). From 1 January 2026 the annual rate is the European Central Bank's main refinancing operations rate plus 8 percentage points. The rate in force on 1 January applies to the first half of the year and the rate on 1 July to the second, and the daily rate is 1/360 of the annual one. Because the rate moves, check the current figure on the ECB's website rather than writing a number into the contract.

Suspending the service

The law lets you withhold your own performance until the other side performs its due obligation from the same relationship (Art. 90(1) ZZD). In SaaS, though, the common practice is an express clause: after a delay beyond a set period and a written warning, access is suspended without this counting as a breach on your side, so there is no argument later over whether the suspension was lawful.

Collecting

The route is a written demand, then the order-for-payment procedure in the district court, with a one-month deadline for the debtor to object. The steps, fees and limitation periods are in our article on verbal agreements, section "If the client refuses to pay". Three points matter specifically for a seller:

• Filing online. Merchants file the application for an order for payment only electronically, through the Unified e-Justice Portal (Art. 410(5) of the Civil Procedure Code, GPK). When the request is filed electronically through the portal, the court fee is reduced by 15% (Art. 73(4) GPK).
• The fast route with notarised signatures. If the contract has notarised signatures covering the money obligation, the creditor can ask for an order for immediate enforcement, whatever the amount of the claim (Art. 417(1)(3) GPK). The same goes for a promissory note (point 10). An ordinary invoice or contract does not give this option, so on a large contract it can be arranged at signing.
• Limitation. The three-year period applies to compensation and penalties for breach of contract, to interest and to periodic payments, and the general one is five years (Arts. 110 and 111 ZZD). If the claim is old, check the period before you act.

A real dispute over payment is the moment to talk to a lawyer. When and how to choose one is in our article on choosing a lawyer.

8. Rights in the code and the design

Corporate customers often ask for "all rights in the code and know-how used under the contract". For a startup that sells the same product to many customers this is dangerous: you can lose the rights in your own platform.

So in practice two things are separated:

• What is developed specifically for the customer under the statement of work, which can pass to the customer, usually after full payment;
• What already exists: libraries, architecture, tools and know-how you had before the contract or use for other customers too. These stay yours, and the customer gets a non-exclusive licence to use them in the delivered product.

What such a clause might sound like (an example a lawyer adapts to your deal): "The Customer acquires the rights in the software developed specifically under this statement of work once the fee has been paid in full. The Contractor keeps the rights in its pre-existing work and grants the Customer a non-exclusive, perpetual licence to use it in the delivered product."

Which rights pass depends on what the contract says expressly. A clean chain of rights is also the first thing an investor checks. Related: a contract with no clause on rights, rights from employees and freelancers, protecting intellectual property and what an investor checks.

9. When the customer sends its own contract

Whose general terms apply

A merchant's general terms bind the other side if it states in writing that it accepts them, or if it is a merchant, knew or should have known of them and did not object straight away (Art. 298(1) TZ). Where the law requires written form for the deal to be valid, general terms bind the other side only if they were handed over when the contract was made (Art. 298(2) TZ). Where what was agreed differs from the general terms, what was agreed prevails (Art. 298(3) TZ; see also Art. 16 ZZD).

The law has no express rule for the case where you send your general terms, the customer replies with its own, and they conflict. So it is safer to settle the difference in writing before you start work, rather than rely on whose terms "were sent last".

Who signs for the customer

Check in the Commercial Register who represents the company before you sign an important contract. The law gives some protection: if someone acts in the name of a merchant without authority, the merchant is treated as confirming those acts unless it objects straight after learning of them (Art. 301 TZ). That protects everyday confirmations, it does not replace the check on a large deal. On electronic signatures, see verbal agreements.

How to negotiate someone else's template

A small startup rarely has the leverage to impose its own contract on a large customer. So negotiations usually run on the customer's template, with tracked changes and a short reason for each edit. In practice startups most often hold out for:

• a liability cap, even one higher than they would like;
• keeping the rights in their pre-existing work;
• a cap on penalties;
• a payment term within the statutory 60 days.

Common concessions are a longer payment term within those 60 days, a separate higher cap for data or rights in software, and a neutral forum for disputes. What to accept depends on the deal and on how much you need the customer.

10. Foreign customers, force majeure and disputes

Governing law and the court

The parties can choose the governing law (Art. 3 of Regulation (EC) No 593/2008, "Rome I"). If they don't, a contract for services is governed by the law of the country where the service provider has its habitual residence (Art. 4(1)(b) Rome I), which for a Bulgarian startup is, as a rule, Bulgarian law.

The parties can also agree which court has jurisdiction (Art. 25 of Regulation (EU) No 1215/2012, "Brussels I bis"). A judgment of a Bulgarian court is recognised in the other EU member states without any special procedure and is enforceable there without a declaration of enforceability (Arts. 36 and 39 Brussels I bis). Outside the EU this is not automatic. So with customers outside the EU a common practice is an arbitration clause before a permanent arbitration court: arbitral awards are recognised in many countries under the New York Convention of 1958.

VAT on sales to businesses inside and outside the EU (reverse charge and place of supply) is explained in our article on startup taxes.

Force majeure

The debtor in a commercial deal is not liable for a breach caused by force majeure, that is, an unforeseen or unavoidable event of an extraordinary nature that arose after the contract was made. If it was already late, though, it cannot rely on it (Art. 306(1) and (2) TZ). It must notify the other side in writing, within a reasonable time, of what the event is and how it affects performance, otherwise it owes compensation (para. 3). While it lasts, performance is suspended (para. 4), and if it lasts so long that the creditor no longer has an interest, either side can terminate the contract (para. 5).

Specific periods, such as notice within 5 days, are contract terms, not statutory text. What is not force majeure: supplier contracts.

11. In short: law and practice

The table sums up the rules in this article. The last column is a common negotiating position, not a rule of law.

The law	Art.	Practice
Liability: cannot be limited in advance for intent and gross negligence	Art. 94 ZZD	Cap at 12 months' fees
Penalty: not reduced between merchants for being excessive, except for improper or partial performance	Art. 309 TZ	An overall penalty cap
Payment term: up to 60 days, longer by exception; if none agreed, 14 days	Art. 303a TZ	An advance from new customers
Late payment: statutory interest and at least EUR 40 in costs	Art. 309a TZ	A right to suspend the service
Acceptance: with no objection, the work is treated as accepted	Art. 264 ZZD	Deemed acceptance after 7 - 14 days
Force majeure: written notice within a reasonable time	Art. 306 TZ	Set periods in the contract

12. Checklist

When you write your own contract

• A framework agreement and separate statements of work, with a rule on which document prevails.
• The scope in an annex and an express "out of scope" list.
• An acceptance procedure with deemed acceptance after a set period.
• A liability cap that does not touch intent and gross negligence.
• A split between what is developed for the customer and what already exists.
• A payment term of up to 60 days, and a right to suspend for late payment.
• A written procedure for changes.
• Governing law and a court or arbitration, especially for customers outside the EU.

When the customer sends its own contract

• Check who signs for the customer.
• Read liability, penalties, rights and payment first.
• Put a cap on penalties and on liability.
• Check the payment term against the statutory 60 days.
• If the contract touches data, check the clauses against the Data Act.
• Settle in writing any conflict between your general terms and the customer's.

When the customer doesn't pay

• Send a written demand with the interest and the compensation of at least EUR 40.
• Suspend the service if the contract allows it, after a written warning.
• Check the limitation period and gather the written evidence.
• File an application for an order for payment online, or talk to a lawyer.

This article is general information as of October 2026, not individual legal advice. NOMELIA is a legal media outlet, not a law firm or a consultancy. The sample wordings have to be adapted to the specific deal.

This article is part of our overview of the Bulgarian laws every startup should know.

The full picture, stage by stage: starting a startup in Bulgaria - a step-by-step legal guide.