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Proviso: Definition, Example and Related Terms

What is a Proviso ?

A proviso is a condition or stipulation that is added to an agreement or contract. It sets out specific terms or requirements that must be met for the contract to be valid or for a certain part of it to apply. It's like a 'but' or 'if' in a contract.

For example, a company might agree to supply goods to another company, but with a proviso that the goods are paid for in advance. This means the company will only supply the goods if the other company pays first. Provisos are important in business contracts because they help manage risks and ensure both parties are clear about what they need to do.

They can be used to set out what will happen if something goes wrong, such as if a party doesn't meet their obligations or if there are changes in the law or market conditions. This can help avoid disputes and make sure the contract is fair and balanced. However, provisos need to be used carefully because if they are not clear or reasonable, they could be challenged and may not be enforceable.


  • Scenario Description
    A company agrees to provide marketing services to another company for a year, with a proviso that the contract can be terminated early if the company does not achieve certain performance targets. In this example, the proviso is a condition that allows the company to end the contract early if the performance targets are not met. This means the company has a way out of the contract if it's not getting the results it wants. It also gives the other company a clear goal to work towards and a reason to make sure it performs well.
    A manufacturer agrees to supply parts to a car company, with a proviso that the price will increase if the cost of materials goes up. Here, the proviso is a stipulation that allows the manufacturer to increase the price if the cost of materials goes up. This protects the manufacturer from losing money if costs increase. It also gives the car company a heads up that they might have to pay more in the future, which can help them plan their budget.

Related terms