This mandatory provision cannot be waived or limited according to Federal Court rulings. This is justified by the fact that in these cases there is a special relationship of trust and it makes no sense to continue to maintain the contract in the absence of such trust (see BGE 104 II 108 E. 4). This principle is criticised in teaching, as it cannot be applied to many cases, for example, to service contracts in the IT sector or outsourcing contracts. These contracts are drafted as agency contracts or innominate contracts, but are not typical contracts. Another criticism is that freedom of contract is unjustifiably restricted and the pacta sunt servanda principle is relativised.

The agency contract is the legal relationship most commonly used in service contracts, namely whenever no work and success is owed, but only a careful execution. However, Article 404 OR is not appropriate nowadays and does not meet the economic and legal needs of companies. The new Article 404a VE-OR (preliminary draft to the Code of Obligations) retains the same wording as the previous Article 404 OR; what is new is the addition that the right of withdrawal at any time is not compulsory but discretionary. The parties are therefore allowed to make provisions deviating from Article 404 OR, which enables the parties to conclude a permanent contract. The parties may also retain the right of termination pursuant to Article 404 OR, but individually agree on the consequences of damages pursuant to Article 404 (2) OR. In other words, there is the possibility in particular of agreeing to penalties that would compensate for any loss of profit (positive interest) in the event of a premature withdrawal. On the whole, the principles of the general part of the Code of Obligations can increasingly be invoked, and ultimately this provision allows the parties to plan better and make Switzerland more attractive as a business location.

If the provision of Article 404 OR is waived, this may be to the detriment of customers by shortening the duration of a contract and thus incurring higher costs – suppliers, however, benefit from it. An agreement that removes the mandatory nature of Article 404 OR has to comply with the intent of the parties – which is why it will not be possible to include a respective amendment only in the GTC. This, in turn, constitutes a restriction on the contractual freedom of undertakings, which is why this restriction must be rejected in business dealings or restricted to the applicability of Article 8 UWG.

Due to the aforementioned reasons, the amendment to the Swiss Code of Obligations is welcomed.