Carp Clause Samples

The CARP (Change in Applicable Regulatory Provisions) clause defines how parties to a contract will address changes in laws or regulations that affect their agreement. Typically, this clause outlines the process for notifying the other party of a regulatory change, renegotiating terms if necessary, or adjusting obligations to remain compliant. For example, if a new law impacts the cost or feasibility of performing under the contract, the CARP clause may allow for price adjustments or even termination. Its core function is to allocate risk and provide a clear mechanism for adapting the contract to evolving legal requirements, thereby reducing uncertainty for both parties.