An invitation to treat is an expression of willingness to enter into negotiations (usually during the course of preliminary communications between the parties) which may lead to a binding contract. It is not made with the intention that the terms should become binding as soon as the offeree communicates his acceptance to the terms and so is distinguished from an offer.
- There is a general rule in respect of the display of goods for sale at a fixed price on a shelf or in a shop window is an invitation to treat and not an offer. The display of goods is generally an invitation to the customer to make an offer, which the retailer may then accept or reject.
- An advertisement that goods are for sale will not generally constitute an offer.
- There is general rule in respect of auctions that the auctioneer’s request for bids is not an offer but an invitation to treat. Each bid constitutes an offer, which is capable of acceptance by the auctioneer.