Supply Agreement in Canada: Template and Key Clauses (2026)

A supply agreement in Canada is the contract under which one business agrees to provide goods to another over time, rather than in a single one-off sale. It governs a continuing relationship: repeat orders, agreed prices, delivery schedules, quality standards and what happens when something is late, short or defective. The better the agreement, the fewer arguments there are when a shipment goes wrong, because the answer is already written down. This is general information, not legal advice. Sale-of-goods and consumer rules are set at the provincial level in Canada, so confirm the current position before relying on a clause. ## Which law governs The sale of goods between businesses in Canada is governed mainly by provincial sale-of-goods legislation, for example the Sale of Goods Act in common-law provinces, with Quebec applying its Civil Code instead. These laws imply terms about title, quality and fitness for purpose unless the contract clearly deals with them. A supply agreement should set its own terms on quality and remedies so the parties are not left relying only on the statutory defaults. For cross-border supply, the parties should also decide whether the UN Convention on Contracts for the International Sale of Goods applies or is excluded. <!-- [VERIFY] whether the relevant province's sale-of-goods statute is named correctly for your province before citing it --> ## A clause by clause skeleton Use this as a structure to adapt, not a finished document. ``` SUPPLY AGREEMENT Parties: [Supplier] and [Customer] Date: [date] 1. SCOPE AND PRODUCTS The goods, specifications and any product schedule. Whether supply is exclusive or non-exclusive. 2. ORDERS AND FORECASTS How orders are placed and accepted, lead times, minimum order sizes and any non-binding forecasts. 3. PRICE AND PAYMENT Unit prices, how and when prices can change, currency, taxes, invoicing and payment terms. 4. DELIVERY AND RISK Delivery point and Incoterms, delivery dates, and when title and risk pass to the Customer. 5. INSPECTION AND ACCEPTANCE The Customer's right to inspect, the window to reject non-conforming goods, and the process for returns. 6. QUALITY AND WARRANTY The goods meet the agreed specification and stated standards. Warranty period and remedy (repair, replace or refund). 7. COMPLIANCE The goods meet applicable Canadian safety, labelling and regulatory requirements for the product. 8. INTELLECTUAL PROPERTY Who owns any designs, tooling or branding, and any licence granted. 9. LIABILITY AND INDEMNITY Liability caps, excluded losses, and indemnities for product defects or third-party claims. 10. INSURANCE The insurance each party must carry, including product liability cover. 11. TERM AND TERMINATION Term, renewal, termination for breach or insolvency, and run-off of outstanding orders. 12. GOVERNING LAW Governed by the laws of [province] and Canada. Disputes resolved by [arbitration / the courts of [province]]. Schedule 1: Products and specifications Schedule 2: Prices

- **Product compliance.** Safety, labelling and bilingual (English and French) packaging requirements can apply depending on the product and where it is sold.
- **Consumer goods.** If the goods ultimately reach consumers, provincial consumer-protection law may add warranty rights that cannot be contracted away.
- **Cross-border.** For imports or exports, address customs, tariffs and whether the international sale-of-goods convention applies. ## Common mistakes to avoid - Relying on purchase orders alone, with no master agreement, so quality and remedy terms are never agreed.
- Leaving title and risk unclear, so loss in transit becomes a fight.
- A price clause that does not say how or when prices can change.
- No acceptance window, so the customer cannot cleanly reject defective goods.
- Forgetting product-compliance, labelling and bilingual-packaging rules for the Canadian market. ## Keeping supply terms and orders in one place A supply agreement is the backbone of a trading relationship, and it rarely stands still. Prices are revised, product schedules change, orders flow against it, and the renewal date and any volume commitments need watching. When the master agreement, its schedules and the order history sit in different systems, it becomes hard to answer a simple question: what did we actually agree on price and delivery? Drafting a supply agreement, reviewing a price or liability clause a counterparty has changed, editing a schedule in plain language and holding every version and date in one view can live in a single AI workspace tuned to how your company contracts. Adira is built around that workspace, running on Claude, with per-seat pricing shown up front and a 7-day trial, India-first and built to work across jurisdictions. You can read more at [adiralaw.com](https://adiralaw.com). For a single straightforward supply deal the skeleton above is enough on its own. The point worth keeping is that supply relationships run more smoothly when the agreement, its schedules and the orders stay together.