Any fix-term contract can be cancelled by giving 20 business days’ notice for cancellation. In certain instances, the supplier is also allowed to charge a reasonable cancellation fee or penalty charge.
Section 14 allows for the cancellation of a fix-term contract. However, it is essential to note that Section 14 does not apply to a consumer agreement between two juristic persons. So it has to be between a juristic person and a natural person.
How are these penalties calculated?
Section 14 makes provision for this. Certain factors must be taken into consideration. For example, the duration of the agreement, any goods that might remain in the consumer’s possession after the termination of the agreement, and other penalties that can be charged.