ARMENIA Law and Practice Contributed by: Narine Beglaryan and Anahit Aloyan, Concern Dialog
A contract for paid provision of services requires the provider to render services to the customer in exchange for payment, and must be concluded in written form. Failure to observe the written form requirement does not invalidate the contract, but lim - its the parties’ ability to rely on witness testimony in case a dispute arises; however, they may still present written or other evidence. Besides general contractual liability provisions, addi - tional customer protections and remedies are as fol - lows: • The provider must perform the services personally, unless otherwise agreed. • If performance becomes impossible due to circum - stances for which neither party is responsible, the customer is required only to reimburse the pro - vider’s actual expenses, unless the law or contract provides otherwise. • The customer may terminate the service contract at any time, subject to reimbursement of the pro - vider’s actual expenses. • Conversely, the provider may withdraw from the contract, but must fully compensate the customer for any losses incurred as a result of such with - drawal. • As for sector-specific protections, operators of electronic commerce platforms are obliged to display mandatory information about vendors and retain this information throughout the vendors’ presence on the platform and for at least one year thereafter (unless a longer period is required by law or contract). Contractor agreements apply where one party (the contractor) undertakes to perform defined work and deliver a tangible or intangible result, while the other party (the customer) undertakes to accept the result and pay for it. The form requirements mirror those for paid service provision contracts. Statutory protections for customers are wider in this case and include the following: • In contracts for the manufacture of goods, owner - ship of the work passes to the customer.
• Work must be performed using the contractor’s own resources (labour, materials, equipment), unless otherwise agreed. • The contractor is liable for the quality of materials and equipment it supplies. • The contractor is responsible for meeting both interim and final deadlines. • The customer may at any time inspect the work in progress and its quality, without interfering in the contractor’s activities. • If the contractor fails to commence or performs so slowly that timely completion is clearly impossible, the customer may terminate the contract and claim damages. • If it becomes evident during performance that the result will be defective, the customer may set a reasonable period to correct the defects; if such defects are not corrected, the customer may termi - nate the contract, remedy defects at the contrac - tor’s expense and/or claim damages. • The customer may terminate the contract at any time before acceptance, subject to payment for completed work and compensation of losses caused by termination. • The result must comply with contractual require - ments or, in their absence, with ordinary quality standards. • Work may be subject to a statutory or contractual warranty period during which defects must not arise. • In case of defects, the customer may demand cor - rection, price reduction or reimbursement of repair costs, or terminate the contract with damages. • The contractor bears the risk of accidental loss until formal acceptance by the customer. • Claims may be raised within the warranty period or, if no such period is agreed, within two years. • If, in the course of performance, a party obtains access to new technical solutions, know-how or trade secrets, it may not disclose them to third par - ties without the other party’s consent. It is worth noting that in practice, outsourcing and technology contracts in Armenia often combine fea - tures of both paid provision of service and contractor agreements.
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