A commercial agency contract is a written agreement that defines the relationship between an agent and his principals. The commercial agency contract describes the obligations, interests and levels of power to which the agent is entitled. In addition, commercial agents may require a certain level of management from constituents. This is to ensure that an agent represents the client`s best interests in each transaction. ICC offers a flexible alternative solution. By using uniform contractual rules and not on the basis of specific national legislation, the model takes into account the practice prevailing in international trade as well as the principles generally accepted in the laws of national agencies. Commercial representation is regulated at the state level and not by U.S. federal laws. Nearly two-thirds of U.S. states have passed specific laws for commercial agency relations with non-employees. Most state laws that govern commercial agency refer to the relationship between an entrepreneur and an agent who requests orders for the purchase of the principal`s products, primarily wholesale and not retail (although state law often includes special rules for agency relationships related to real estate transactions and insurance policies). Generally, state law in this area follows the agency`s common law definition, which imposes a fiduciary duty on the agent in favour of the principal to act on behalf of the principal and under the control of the principal.
(8) Non-genuine agency contracts and provisions relating to the exclusivity of the Agency[9] and/or non-competitive provisions[10] of a genuine agency contract may fall within the scope of Article 101(1) of the Treaty on the Functioning of the European Union. In the ECJ`s CEPSA II judgment[11], the Court held that, even in the absence of an agreement between independent undertakings, the provisions on exclusive representation and non-competition concern the relationship between the representative and the contracting entity and, in the ECJ`s view, “in the context of such relations, agents are in principle independent economic operators and such clauses are liable to infringe the competition rules to the extent that where they prevent the blocking of the this is the case in the United Kingdom. Therefore, the prohibition laid down in Article 101(1) TFEU may also apply, in the case of a genuine commercial agency contract, both to the provisions relating to exclusive distribution agencies and to non-competition obligations. In that case, those provisions, as well as other vertical arrangements, may benefit from the safe harbour rules provided for in the Exemption Regulation by the Block Exemption Regulation. The law also provides that (a) the commercial agent is not entitled to compensation if the principal terminates the contract due to the agent`s breach; and (b) courts have the right to reduce the amount of compensation or not to provide compensation if that is fair and correct in the circumstances. The customer`s claim for compensation expires as soon as the commercial agent has not informed the customer at the latest within one year after the termination of the commercial agency contract that he is requesting such compensation. Apart from the above case, goodwill fees cannot be waived as the provision is mandatory under Article 7:442 of the Dutch Civil Code. The amount of the customer`s fee depends on a number of circumstances. First of all, it is important that the client`s costs are never higher than the remuneration over a year.
The above-mentioned remuneration results from the calculation of the average remuneration of the previous five years. If the agency contract has lasted less than five years, the average of the past years is taken. The fact that the remuneration is never higher than the remuneration over a year does not mean that the remuneration is always the same as this average remuneration. In its November 2012 decision, the Supreme Court ruled that compensation should be calculated using a three-stage rocket. First of all, it is necessary to identify the benefits that result from the transactions with customers introduced by the agent. It is then considered whether the amount determined on the basis of step 1 should be adjusted in terms of fairness, all the circumstances of the case and the commission lost by the agent. Equity may involve an increase or decrease in the amount set in the first step. Finally, it is checked if the amount invoiced does not exceed the maximum amount (the average fee over a year). In general, under state law, clients and representatives are required to act in good faith in the performance of their obligations in an agency relationship, subject to the express terms agreed in the agency contract. In addition, under the law of certain states, the Customer is required to indemnify the Contractor against liabilities to third parties arising from the performance of the Agent`s obligations to adequately compensate the Agent for its services and to reimburse the Agent for reasonable costs incurred by the Agent in providing such a service.
In this regard, New York law does not provide for any mandatory obligation of the client in favour of the representative (the New York courts, which have permanently upheld a representative`s right to compensation from a client, are based on a contract). – restrictions on the territory in which and/or the customers to whom the commercial agent may sell his goods; 23. Another issue raised by the stakeholders concerns the method of reimbursement of the relevant costs incurred by the agent. Since there may be different ways of compensating an agent, no specific method is required for an agreement to be considered a genuine agency contract, provided that the principal fully covers the corresponding costs. For example, a customer may choose to reimburse the exact costs incurred. A contracting entity may also choose to cover these costs by paying a fixed lump sum or by paying a share (fixed percentage) of the revenue from the products sold under the agency contract. All such methods of reimbursement are acceptable in principle, in particular in situations where a procuring entity may cooperate with a large number of staff, as they may reduce the administrative burden on the procuring entity and the staff concerned. However, DG Competition proposes that these repayment methods be designed in such a way that they always cover all relevant costs, so that the actual representative bears no or only insignificant risks of the three types of financial or commercial risks mentioned above. This may require a reimbursement system that allows the agent to easily explain and claim reimbursement for costs in excess of the lump sum or fixed percentage. It may also request the principal to monitor and examine the evolution of the costs concerned and to adjust the lump sum or fixed percentage at regular intervals to take account of significant variations in costs in a way which does not affect the staff member.
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