4. MacRobertsLLP
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Agency v Distributor
• Both agent and distributor are intermediaries in
the supply chain between the principal/supplier
& the end customer.
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• The distinguishing factor is the position or status
of the intermediary in relation to the
principal/supplier & the end customer.
5. MacRobertsLLP
www.macroberts.com
What is a Commercial Agent?
“ a self-employed intermediary who has continuing
authority to negotiate the sale and purchase of
goods on behalf of another person (“the principal”)
MacRobertsLLP
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goods on behalf of another person (“the principal”)
or to negotiate and conclude the sale of purchase
of goods on behalf of and in the name of that
principal…..”
6. MacRobertsLLP
www.macroberts.com
Law
• Common law
◘ Fiduciary relationship
◘ Obey lawful instructions
◘ Act within limits of authority
◘ Not to make secret profits
MacRobertsLLP
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◘ Not to make secret profits
• Statutory
◘ Commercial Agents Directive (86/653/EEC) –
under evaluation
◘ Commercial Agent’s Regulations 1993
7. MacRobertsLLP
www.macroberts.com
Agency Agreement
• Why appoint an agent and terms to
consider?
◘ Supplier can retain control of the terms of
MacRobertsLLP
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◘ Supplier can retain control of the terms of
sale of the product e.g. the price
◘ Restrict the customers the agent deals with
◘ Control over marketing methods
◘ Regulate samples
8. MacRobertsLLP
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Termination of Agency
Agreement
• Indefinite term or fixed term
• Benchmarking
MacRobertsLLP
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• Benchmarking
• Minimum notice periods
◘ One month for the first year
◘ Two months for second year
◘ Three months for third year and
subsequent years
9. MacRobertsLLP
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Distribution Agreements
• Principal/supplier can pass a large
degree of risk onto the distributor
• Distributor more motivated to sell due to
risk
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risk
• The principal/supplier only has to monitor
one account with the distributor
• No compensation or indemnity is payable
to the distributor on termination in the UK
10. MacRobertsLLP
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Managing your distributor
• Written distribution agreement
• Reference underperformance to a
quantitative or qualitative criterion
MacRobertsLLP
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quantitative or qualitative criterion
• Sales criteria – how the product is
sold and who the product is sold to
• Samples
11. MacRobertsLLP
www.macroberts.com Distributor appointed in foreign
country
• Points to consider -
◘ Is the agreement subject to the laws of the foreign
country where the distributor is based?
MacRobertsLLP
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◘ Is there legislation in that country that specially
related to distribution agreements?
◘ Will the supplier have to comply with any formalities
when appointing the disributor?
12. MacRobertsLLP
www.macroberts.com
Case
• Raoul Sagal (Trading as Bunz UK) v Atelier
Bunz GMBH
• Raoul Sagal claimed he was commercial
agent for Atelier Bunz GMBH.
MacRobertsLLP
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agent for Atelier Bunz GMBH.
• Sold jewellery designed by Bunz in the UK
under an oral contract.
13. MacRobertsLLP
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Case
• Claramode Limited v Zoomphase
Limited (t/a Jenny Packham) 2009
EWHC 2857 (Comm)
MacRobertsLLP
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• High Court considered the position
of when the agent’s authority ended
in the absence of a clear termination
date
