If you have any doubts about the control of international distributors, you should discuss this with your lawyer before entering into an agreement. There are clauses that can be included in your agreements so that you have a close eye on your distributor`s activities. For example, European competition law prevents you from entering into a distribution agreement that imposes minimum prices for resale, limits cross-deliveries or limits internet sales. Any provision which affects trade between Member States and restricts or distorts competition shall be prohibited. There are exceptions, for example. B if your distribution agreement is considered a “small” agreement and, in some cases, exclusive agreements may also be excluded. EU competition law is strictly enforced and you should seek legal advice on competition law issues. The agreement should also set the duration of the business relationship. In addition, procedures should be put in place to address issues related to extension and termination. A distribution contract is a commercial contract between a supplier of goods and a trader of goods. The supplier can be a manufacturer or reseller of the products. In the modern business world, more and more companies are participating in distribution agreements that cross international borders.
According to the World Bank, international trade accounted for nearly one-third of U.S. gross domestic product (GPD) in 2017. Companies carrying out this type of cross-border activity need well-structured international distribution agreements. Key Clauses of an International Distribution Agreement An international distribution agreement is essentially a contract that creates a framework for a business relationship between the global parties. In order to ensure efficient and effective transactions, an international distribution agreement should be comprehensive. Some of the main clauses that you typically find in an international distribution agreement include products and territories, obligations of the parties, exclusivity clauses, renewal/termination, and dispute resolution. Products and territory International distribution agreements usually include details about the specific products and the specific area covered by the contract. Commitments of the parties As with other commercial agreements, it is essential that an international distribution contract clearly defines the responsibilities of each party. .