DE-ESCALATION CLAUSE

An article in a contract that calls for a price decrease if there is a decrease in certain costs.

It calls for a price that decreased if there’s a decrease in a certain cost. A de-escalation can stipulate the maintenance fee that will be reduced if the item is maintained in value. A de-escalation clause is the opposite of an 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.

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