A contract governed by GMC law is no longer drafted by analogy. Since 15 June 2026 the Sale of Goods Act 2026 and the Unfair Contract Terms Act 2026 have been in operation, so the implied terms, the limits on exclusion clauses and the reasonableness test are all fixed by statute. Basnet Law drafts and reviews supply, services, distribution, licensing and platform agreements governed by GMC law. This page explains what the two Acts require and how we draft against them.
How we help
- Draft governing law, jurisdiction and dispute resolution clauses that work with the common law received under the Application of Laws Act 2024.
- Decide which implied terms to keep, vary or exclude under the Sale of Goods Act 2026, and draft exclusions that survive the Unfair Contract Terms Act 2026 (UCTA).
- Structure limitation and exclusion clauses to pass UCTA's reasonableness test, with the burden of proof and the Second Schedule guidelines in mind.
- Identify international supply contracts that fall outside UCTA and draft accordingly.
- Use, or exclude, third-party enforcement rights under the Contracts (Rights of Third Parties) Act 2007, which applies in GMC through Schedule A.
- Build electronic contracting and e-signature workflows on the Electronic Transactions Act 2010, applied through Schedule A.
- Prepare standard terms of business for GMC trading companies and platforms, and the consumer-facing variants UCTA requires.
How GMC contract law works, in plain terms
The Sale of Goods Act 2026 implies terms into every contract of sale. There is an implied condition that the seller has the right to sell, and implied warranties of freedom from undisclosed encumbrances and of quiet possession. In a sale by description, the goods must correspond with the description. Where the seller sells in the course of a business, the goods must be of "satisfactory quality", meaning the standard "a reasonable person would regard as satisfactory" taking account of description, price and circumstances, and must be reasonably fit for any particular purpose the buyer has made known. Sale by sample carries its own conditions. These implied terms may be negatived or varied by express agreement, course of dealing or usage, but only "subject to the Unfair Contract Terms Act 2026". In non-consumer sales, the Act restricts rejection for slight breaches.
UCTA then controls what can be excluded. Liability for death or personal injury from negligence cannot be excluded at all; other negligence liability only where reasonable. Where a party deals as consumer or on the other's written standard terms, a clause excluding liability for breach, or allowing substantially different or no performance, is effective only if reasonable. The implied title undertakings in a sale cannot be excluded; against a consumer the description, quality, fitness and sample terms cannot be excluded, and against a business only where reasonable. The reasonableness test asks whether the term was fair and reasonable having regard to the circumstances known or in contemplation when the contract was made, and the party relying on the term must show it. For a cap on liability, the court looks at resources and insurance. UCTA does not apply to international supply contracts and does not apply to contracts made before 15 June 2026. It applies despite a foreign governing law where the choice was imposed to evade it or the consumer is habitually resident in GMC.
Two Schedule A statutes complete the toolkit. The Contracts (Rights of Third Parties) Act 2007 lets a named or described third party enforce a term, so group affiliates and end-users can be given direct rights, or the Act can be excluded. The Electronic Transactions Act 2010 supports electronic records and signatures, which matters for onboarding and click-through terms on GMC platforms.
Who this is for
- GMC trading companies and distributors selling goods into or from Gelephu.
- Software, SaaS and digital asset platforms with standard terms for business and retail users.
- Suppliers and contractors on GMC construction and infrastructure projects.
- International groups adopting GMC law for intra-group and customer contracts with a GMC entity.
How an engagement runs
- Commercial brief: we identify the parties, goods or services, counterparty type and risk allocation.
- Statutory mapping: we determine whether the contract is a sale of goods, whether UCTA applies (including the international supply exclusion) and whether either party deals as consumer.
- Drafting: we prepare the agreement or standard terms with exclusions calibrated to the reasonableness test.
- Review: we test each limitation clause against the Second Schedule guidelines and the insurance position.
- Rollout: we provide execution guidance, including electronic signature, and a clause-by-clause note for the commercial team.
Frequently asked questions
Can we exclude the satisfactory quality term in a business-to-business sale?
Only if the exclusion is reasonable under UCTA. It cannot be excluded against a consumer. The implied terms as to title cannot be excluded at all. We draft the clause to meet the test and record why it is reasonable.
Does UCTA apply to our cross-border supply contract?
Not if it is an international supply contract as UCTA defines it. We check the parties' places of business and the movement of goods before relying on the exclusion.
We signed our contracts before June 2026. Are they affected?
UCTA does not apply to contracts made before its commencement on 15 June 2026. Renewals and variations after that date should be reviewed, and we do that as part of a standard-terms refresh.
Can a third party enforce our contract?
Yes, where the contract confers a benefit on a named or identified third party, under the Contracts (Rights of Third Parties) Act 2007 as applied by Schedule A. Most commercial contracts should state whether that Act is excluded, and ours do.
Is an electronic signature valid in GMC?
The Electronic Transactions Act 2010 applies in GMC through Schedule A and supports electronic records and signatures. Companies executing deeds should also follow the execution rules in the Companies Act 2025.
What law fills gaps in a GMC contract?
The common law and equity of established common law jurisdictions, including received English common law and equity, applies so far as suited to GMC circumstances and subject to GMC enactments, under the Application of Laws Act 2024.
Talk to GMC counsel on the ground
Basnet Law Pte. Ltd. is the first law firm incorporated in the Gelephu Mindfulness City. A short conversation early in a matter usually saves time and cost later. Write to basnet@basnetgmc.com or office@basnetgmc.com with a few lines about your plans, and we will tell you plainly what is needed, how long it takes, and whether we are the right fit.
You may contact Basnet Law at basnet@basnetgmc.com or office@basnetgmc.com for any legal queries related to GMC.
