The barter contract is making a comeback stronger than ever. The possibility of offering products in exchange for products and services in exchange for products can be a good solution to provide an “outlet” for many “frozen” or out-of-use assets.
Semper vetus, semper novos.
Motto of the Roman Empire
In his book on heroes and wonders of the Middle Ages, the great French medievalist Jacques Le Goff, selects certain heroes and wonders of the Middle Ages that from those distant times have crossed history to remain part of the collective imagination until our time. Among them, some more relevant than others, he cites Robin Hood, the Cid, the troubadours, the minstrels, King Arthur, the cathedrals and the unicorn (isn’t that what Starups valued at more than 1 billion are called?). If we were to do this exercise in the field of law, we could go back much further -law is in its essence the great contribution of Rome to universal culture- and we could mention the barter (or swap, as the contract is usually called), which in its simplest form is nothing more than a barter contract, service for service, object for object, service for object and its many variations.
The pandemic situation (not so much the pandemic as the situation it has generated) will not only change us in many ways but has already changed us: the paralysis -and the speed with which it has occurred- of economic activities (and in those cases where they have not been paralyzed, this has slowed down), the need to modify business plans and look for new lines of businessthe uncertainty of the timetable for the return to the new normality, the “de-escalation” por sectores que modificará el eje de las prioridades para muchas personas, los ERTES y reducción de salarios, horas laborales o bonus y demás complementos, la disminución de dividendos, la injerencia del Estado en ámbitos económicos donde antes parecía impensable, el desarrollo del teletrabajo, el control de la actividad y movimientos, las restricciones de distancia al transporte púbico (todos tenemos en la retina los empujones en el metro de Tokio a la hora punta, ¿podrán volver a repetirse?, las necesidades de “repliegue” si vuelven a disparase los contagios, etc.
The list is endless, it changes as the days go by, and it goes without saying that each sector will be very aware of its own and each person will suffer and adopt them in his or her own way. What seems to be more and more evident is that revenues are going to decrease, in general there are always exceptions, considerably. The lack of liquidity is, and will be for a long time, one of the main problems that companies will face, from sectors such as the Spanish Association of Starups is already warning about it and demanding government aid (El País, business), as on the other hand most sectors. To give another example, large law firms are beginning to prepare contingency plans and are studying incentive cuts, asking for loans to partners and activating their reserve mechanisms (Cinco Días) or the wine sector that falls by 35% without the demand of hotels and restaurants and can reach 50% in the Mediterranean countries that is not compensated by online sales (La Vanguardia, economy). There is talk of a collapse of profit figures and 26 million layoffs in the United States, not to mention the figures in our country. These are just a few examples of these days, a trip around the net would take us to fill pages and more pages.
Given the lack of income, it is obvious that most companies are looking for alternatives to survive (only 6% are considering closing the business according to a survey of businessmen and entrepreneurs conducted by Netmetora) and that to do so, they are forced to cut costs in all areas of their organization and activity, from labor to hiring, which in turn results in less income for those companies that live by offering services to other companies. It is a chain that will take a long time to rebuild, and when it is rebuilt, it will not be the same.
Cutting costs, changing priorities, refocusing on other lines of business will leave many companies with underutilized or redundant assets, but it will not be easy -and in many cases not convenient- to get rid of them.
In this context, it seems as if bartering, which has never completely disappeared, is re-emerging stronger than ever. The possibility of bartering, exchanging products for other products, can be a good solution to provide an “outlet” for many “frozen” or unused assets. Many companies are looking for services in exchange for products (or any of its variants) that do not require monetary disbursements and that allow to reactivate assets or revitalize areas of the company whose cost at the moment is not compensated by income. Some companies do this on an individual basis and impose this criterion on their usual collaborators. In this sense, different initiatives are beginning to be considered to connect products and services that can benefit a large number of companies. In addition to solving a specific problem, this initiative can serve to generate more permanent collaborations and also discover other alternatives that otherwise would not have been generated. For this, the swap contract and its adaptation to a digital world will be a fundamental piece.
The barter/exchange contract is usually qualified as a contract very close to the purchase/sale contract as it has most of its characteristics except that, in general, the payment from one party to the other is not made with money but with the delivery of a thing. The characteristics and types of contract (barter of a future thing, barter in part in money, barter of rights, etc.) and it would not make sense here, being the pretension of these lines to point out the possibility and the importance of this barter contract and its formulation in writing when the parties want to carry out an operation of this type. The fact that the barter contract “sounds” like a more flexible alternative does not imply that it is a commercial transaction like any other and it is necessary to take the same precautions and cautions as with any other, or perhaps even more, since they “re-emerge” from a need to respond quickly and effectively to a situation that has been a turning point in the world economy and certainly in the way in which many things will be done in the future.
Let’s think about it. Sometimes it’s a matter of inventing, sometimes it’s enough to adapt. Those who know how to do both have a greater number of alternatives at their disposal. This is also true for lawyers, and who wouldn’t want to be in this group?
