If your business needs to use a third-party intermediary to distribute goods to market, you will need to draft an agreement, regardless of you being the manufacturer or wholesaler.
Our team has extensive knowledge of the relevant regulations, such as the Commercial Agents Regulations 1993, surrounding agencies and distributions and can provide a jargon-free explanation of your rights so you don’t run into any difficulties along the way.
About Agency and Distribution Agreements
While the overall aim is similar, agency and distribution arrangements are quite different. An agency arrangement will typically employ a third party to negotiate and conclude contracts on behalf of the owner of a product; a distributor will buy goods to sell on their own behalf.
An agent will receive a commission for the products sold, usually as a percentage of the net sales prices, while a distributor will retain the price received for goods sold, for example.
The decision over which route to take depends upon individual circumstances and preferences. We are able to assist you in making that decision, ensuring it is the best for you and your business. We have experience in dealing with agency and distribution agreements both in the UK and internationally.
We will provide you with comprehensive legal advice on all aspects of agency, distribution and manufacturing agreements. We understand how critical these arrangements are to your business’s success and will work closely with you to develop a practical plan that meets your business’s needs.
Our services include:
- Preparing and enforcing agency, distribution and manufacturing agreements
- Review of existing agreements
- Advice on building relationships with third-parties
- Assistance in the termination of agreements
- Support during disputes involving agreements
With our expertise and knowledge, you will have a robust and commercially minded team on hand to help expand your business in a lawful manner.
Do I have to pay a fee to an agent upon termination of a commercial agency?
To start with, probably yes, but this is dependent upon a number of factors:
- Do the Commercial Agents Regulations/Directive apply? Generally, these will apply to agents within the UK/EEA where the agent is afforded some right of negotiation with the customer and where the ultimate contract is for the supply of goods
- Whether the payment is precluded due to certain factors, such as breach of the agency agreement by the agent, which has resulted in its termination by the principal, whether the agent has terminated for a reason other than age, illness or reasons attributable to the principal
- Whether the agent makes a claim - it has up to one year to do so
Is it possible to cap the termination payment?
For EEA-based agreements, you cannot get out of making a termination payment. However, the agency agreement should stipulate that the payment is made on an indemnity basis as opposed to a compensation basis. This means that the payment is capped at levels set out in the regulations.
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From our offices in Leeds, Sheffield and York, we handle agreements across Yorkshire and the UK. Speak to us today by using the details below to find out how we can help you.
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