Ways To Terminate A Fixed-Term Contract

Fixed-term contracts are commonly used in business-to-business arrangements, such as service agreements or supply contracts, where both parties agree to work together for a specific period. However, there may come a time when one or both businesses want to terminate the contract early.

This guide answers common questions about how to terminate a fixed-term contract between businesses under English law.

What is a fixed-term contract in a business-to-business context?

A fixed-term contract between businesses is a legally binding agreement in which the parties agree to work together for a predetermined period, often with clearly outlined start and end dates, e.g., for a fixed period of 5 years. These contracts are typically used for the supply of goods and services where the relationship is expected to last only for a specific duration or until certain tasks or conditions are fulfilled.