De-Escalation Clause

What is ‘De-Escalation Clause’

An article in a contract that calls for a price decrease if there is a decrease in certain costs. For example, a de-escalation clause may stipulate that maintenance fees will be reduced if the item being maintained depreciates in value. A de-escalation clause is the opposite of an escalation clause.

Explaining ‘De-Escalation Clause’

A de-escalation clause can protect consumers from paying inordinately high prices over the life of a contract that was signed during a time of unusual circumstances. For instance, shipping costs may be higher than normal when a contract is signed due to atypical prices on gasoline. A de-escalation clause will correct for that by lowering the contracted shipping rate as gasoline prices drop.

Further Reading

  • The Senkaku/Diaoyu dispute and Sino-Japanese political-economic relations: cold politics and hot economics? – [PDF]
  • De-escalating information technology projects: Lessons from the Denver International Airport – [PDF]
  • Affect assessment in crisis negotiation: An exploratory case study using two distinct indicators – [PDF]
  • De-Escalate Commitment? Firm Responses to the Threat of Negative Reputation Spillovers from Alliance Partners' Environmental Misconduct – [PDF]
  • Consequences of the US-China “Phase-one” Trade Agreement – [PDF]
  • Gene promoter methylation signature predicts survival of head and neck squamous cell carcinoma patients – [PDF]
  • IT Project Failure and Vendor Related Risks: Is Outsourcing a Solution or a Problem? – [PDF]
  • Vendor related risks in IT development: A chronology of an outsourced project failure – [PDF]