Rising fuel prices: what can you do?

Due to the conflict in the Middle East, fuel prices are rising rapidly. For many companies, diesel is a major expense. This raises questions such as: How high can prices go? Can you pass these costs on to your customers? And what does this mean for employees’ mileage allowances?

We cannot influence fuel prices themselves. Furthermore, the situation is highly volatile, making it difficult to offer clear-cut advice. However, we can help you with information, practical tips, and useful sample texts.

Important to know: providing standard tables for fuel surcharges is not permitted. This can be viewed as prohibited price-fixing and cartel formation.

Current agreement: you are a supplier or contractor

Do you make use of the Fedecom terms and conditions? If so, Article 7 allows you to pass on increases in cost-determining factors, such as fuel, to the client.

Article 7 – Price Changes
The contractor may pass on to the client any increase in cost-determining factors that has occurred after the agreement was concluded. The client must pay the price increase upon the contractor’s first request.

Current agreement: you are a buyer or client

The basic principle is that agreements must be honored, unless it is no longer reasonable to expect a party to do so.

Do you work with your own purchasing terms and conditions, and have you properly declared them applicable? If so, there’s a good chance they state that the supplier is not free to adjust prices or delivery times. If, on the other hand, the supplier’s terms of delivery apply, there is a greater likelihood that price increases may be passed on and delivery times may be extended.

Agreements yet to be finalized: you are a supplier or contractor

When preparing new quotes and order confirmations, it’s wise to take into account uncertain prices and delivery times for materials, energy, and transportation. You can include the text below for this purpose.

Sample text for quotes and order confirmations

Price and Delivery Time
The availability and cost of materials and raw materials are currently highly uncertain due to the conflict in the Middle East. We are therefore unable to provide a definitive answer regarding delivery time and price when issuing the quote or concluding the agreement. Should (1) there be an increase at any time in cost-determining factors, such as costs for materials, energy, and transportation, and/or (2) the materials are delivered to us later than we had anticipated when preparing the quote or order confirmation, we reserve the right to pass this price increase on to you and/or to extend the delivery time. We appreciate your understanding in this matter.

English
The availability, price, and cost of materials and raw materials are currently very uncertain due to the conflict in the Middle East. Therefore, we are unable to provide you with a definitive answer regarding delivery times and prices when issuing a quote or entering into an agreement. If (1) at any time there is an increase in cost-determining factors, such as the costs of materials, energy, and transportation, and/or (2) the materials are delivered to us later than we anticipated when preparing the quotation or order confirmation, we reserve the right to charge you for this price increase and/or to extend the delivery period. We appreciate your understanding regarding this situation.

German
The availability and (cost) price of raw materials and supplies are currently highly uncertain as a result of the conflict in the Middle East. Therefore, at the time of submitting a quote or concluding a contract, we unfortunately cannot provide any certainty regarding delivery times or prices. Should (1) there be an increase at any time in the factors determining the cost price—such as material, energy, or transportation costs, or should (2) materials be delivered to us later than we had assumed when preparing the quote or order confirmation, we reserve the right to charge you for this price increase and/or to extend the delivery period. We ask for your understanding in this matter.

Agreements yet to be finalized: you are a buyer or client

If you’re currently purchasing materials or raw materials, there’s a risk that a supplier may later be unable to deliver or may only be able to do so at a higher price. While this risk cannot be completely eliminated, you can mitigate it by including clear terms in your purchase order.

Sample text for purchase orders

Price and Delivery Terms
The prices agreed upon with us are fixed and may not be increased after the agreement has been concluded. The provisions of Article 7:753 of the Dutch Civil Code do not apply. If the contractor is unable to deliver the materials or raw materials within the agreed-upon timeframe, the contractor is immediately in default, entitling us to terminate the agreement. The contractor is liable for any damages we incur as a result.

English
The agreed-upon prices are fixed and may not be increased after the agreement has been entered into. The provisions of Article 7:753 of the Dutch Civil Code do not apply. If the contractor is unable to deliver the materials or raw materials within the agreed timeframe, the contractor is immediately in default, as a result of which we have the right to terminate the agreement (“ontbinden”). The contractor is liable for any loss we suffer as a result.

German
The agreed-upon prices are fixed and may not be increased after the contract is concluded. The provisions of Article 7:753 of the Dutch Civil Code do not apply. If the contractor is unable to deliver the work or raw materials within the agreed timeframe, the contractor is immediately in default, which entitles us to terminate the contract (“ontbinden”). The contractor is liable for any damages we incur as a result.

Employees and mileage reimbursement

Employees are also feeling the effects of high fuel prices. Increasing the travel allowance is currently not an option for employers. If you pay more than 23 cents per kilometer, that amount is considered wages and is subject to tax. At this time, the government is still taking a wait-and-see approach. The situation is still too new and too unpredictable.

If it is indeed the case that travel costs are set to rise structurally and companies and employees cannot afford them, there are various levers that can be pulled. In that case, we need to look to the government to see which levers can be pulled.

Developments are unfolding rapidly. During the debate on March 25, the cabinet did not yet make any commitments regarding compensation. VNO-NCW and MKB-Nederland submitted a position paper for this debate. We are closely monitoring these developments. Click here for the position paper from VNO-NCW and MKB-Nederland.