This document discusses agency agreements and partnerships for international business. It describes how overseas agents and distributors are essential but small businesses often lack the resources to find reliable partners. The document then outlines services available through the US Commercial Service to pre-qualify potential partners. Finally, it provides details on the contents and considerations for agency agreement contracts with US manufacturers or overseas agents.

1. 1
CHAPTER XXVIICHAPTER XXVII
OVERSEAS AGENTS/OVERSEAS AGENTS/
DISTRIBUTORS & AGENCYDISTRIBUTORS & AGENCY
AGREEMENTSAGREEMENTS
International Partner SearchInternational Partner Search
ServiceService
Agency Agreement With a U.S.Agency Agreement With a U.S.
ManufacturerManufacturer
Agency Agreement With anAgency Agreement With an
Overseas AgentOverseas Agent

2. 2
Overseas Agents/DistributorsOverseas Agents/Distributors
Agents & Distributors are essential
Time & cost for locating reliable agents
and distributors are too high for small
businesses.
One of reasons why most U.S.
manufacturers are not engaged in
export business

3. 3
International Partner Search ServiceInternational Partner Search Service
U.S. Commercial Service of USDC locates the
most suitable agents, distributors, joint-
venture partners, licensees & provides up to
5 prequalified partners
 Save time and money by working only with pre-
qualified partners
 Obtain market information on marketability and
sales potential
 Receive complete contact information on key
officers and on the companies, and a statement
from each potential partner on the marketability of
U.S firm’s products or services
 Get all information within 30 business days

4. 4
Agency Agreement with U.S.Agency Agreement with U.S.
ManufacturerManufacturer
 Manufacturer’s appointment of an EMC as an
exclusive sales agent or export department for a
certain territory: all foreign countries or a few
countries
 Compensation: Commission or salary, salary plus
comm.
 EMC’s right to appoint overseas agents and
distributors
 EMC’s minimum performance requirement
 Jurisdictional clause
 Arbitration clause
 Contract period
 Contract termination clause

5. 5
Agency Agreement withAgency Agreement with
Overseas AgentOverseas Agent
ICC Model Commercial Agency Contract:
ICC Publication No. 644F
Agent shall not have business dealings
with competitive firms.
Not reveal any confidential information in a
way that would prove injurious,
detrimental, or competitive to the U.S. firm.
Not enter into agreements binding the U.S.
firm without prior approval.

6. 6
Agency Agreement withAgency Agreement with
Overseas AgentOverseas Agent
Refer all inquiries received from outside
designated sales territory to the U.S. firm.
Apply the utmost skill and ability to the sale
of the product for the compensation named
in the contract.
Meet the minimum sales requirement per
year.
Jurisdictional clause
Which country’s or State’s law to govern
the agency contract

7. Agency Agreement withAgency Agreement with
Overseas AgentOverseas Agent
Arbitration clause
Settlement of future possible disputes
American Arbitration Rules
ICC Arbitration Rules
Contract termination clause
Contract terms: How many years?
Just causes for termination before expiry
date
7

8. 8
Agency Agreement withAgency Agreement with
Overseas AgentOverseas Agent
Foreign laws restraining termination of
Agency Agreements:
 Foreign countries’ national laws giving
extraordinary protection to U.S. Firms’ foreign
agents or distributors at the expense of the
principals and making termination of the contract
difficult or costly without legal justification.
 Goodwill indemnity: One year’s potential
commission for 5-year agency contract in EU
countries