Unexpected tariffs on food, equipment and essential materials could spike the cost of the incident, forcing planners and suppliers to scramble to make solutions. Without contractual guarantees, these sudden price increases could derail the budget.
“It is a challenge to address tariffs in conference and event contracts. Often, we don’t know if there will be tariffs on products and how much tariffs these tariffs may be imposed. However, this is a problem and suppliers, like the organizations that host conferences, affect venues and suppliers,” said Joshua Grimes, attorney for Grimes Limes Law Law Office.
They can greatly expand the cost of imported goods. “Contracts usually bear fixed costs for non-food supply, so if the price increase of tariffs is not addressed, suppliers will leave tariff charges,” Grimes said.
Food prices pose a greater challenge. The venue usually sets a rate before the event. When tariff-driven cost stacks are above standard market volatility, the end bills may soar.
Contract strategies for managing tariff risks
Planners can incorporate positive measures into their contracts
Replacement of comparable items: One practical approach is to allow the affected party to replace any product subject to tariffs with comparable, low-cost items. “If the price of non-food products increases significantly (e.g., 10% or more) due to tariffs, the supplier that provides the product has the right to replace another comparable low-cost item without the consent of the group.
Flexible F&B options: For F&B, if the tariffs will cause a substantial increase after signing, the food provider or conference group should have the option to replace the lower-priced menu item, again getting approval from the group.
Force majeure of international conferences: A unique challenge arises when a U.S.-based team meets abroad and faces tariffs on U.S.-made products. In this case, if either the cost of importing products from the United States is greatly increased, or the essential products are completely restricted to the meeting location, it will be a force-majeure event. The remedy for this force will cancel the meeting altogether, inappropriately change the elements of the meeting, or scope without a smaller meeting, limit in a smaller case, and encounter smaller meetings, and encounter smaller contacts, and enjoy smaller fees and treat them as smaller,” Grimes said.
