A practical consideration for Business Day


When parties carry out their obligations under an agreement, they may be able to carry out the obligations only on a working day. This is usually achieved by providing in the agreement that the obligations would be done on a “Business Day”.

A typical definition of “Business Day” provides that it is a day on which commercial banks in [insert place where the parties carry out their business] are open for transaction of normal banking business and which is not a public holiday, [Saturday and Sunday].

The definition of Business Day should be tied to the place where the parties carry out their business. As some public holidays are observed by certain states only, a party which is carrying out business in Malacca may not be able to carry out its obligations when it is a working day in Kuala Lumpur but a public holiday in Malacca, for example. The same consideration applies if parties have their place of business in different countries.

It is a practical consideration but sometimes overlooked. Check the definition of “Business Day” in agreements to ensure it is feasible for the parties to the agreements.


This post was first posted on Linkedin on 17 February 2021.

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