Agency
Sound advice is essential when considering the basis on which to carry out business. Our corporate team is experienced in guiding those thinking about acting as commercial agents, distributors and franchisees, as well as principals and franchisors. The law in these fields evolves continuously, in particular because of the influence of the European Union. We will ensure that you are fully aware of the contractual rights and obligations facing you. For practical advice see our checklist below.
Appointing an Agent
This checklist is designed to remind a manufacturer or supplier of goods or services (the Principal) of the issues to be considered when appointing an agent, either in the UK or elsewhere:
- The parties
- Territory/products or services
- Nature of appointment
- Duration of appointment
- Agent's obligations
- Supplier's obligations
- Advertising, promotion and training
- Commission
- Intellectual Property
- Product Liability
- Termination Notices
- Arbitration
- Relevant Law
- Notification
- Effect of appointment
- Note that certain aspects of the agreement will be regulated by the Commercial Agents (Council Directive) Regulations 1993 ("the Commercial Agents' Regulations").
The Regulations give a commercial agent the right to a compensation payment on termination of the agency agreement. The decision in Lonsdale v Howard & Hallam Limited has provided simplicity and certainty in calculating the value of compensation to be paid to an agent. Previously this was a much disputed area of the law.
Compensation should be equal to the value of the agency at the date of termination. That is, what someone would pay for it, rather than what the agent would have expected to receive - an amount that can be determined simply and easily.
Contact: Scott Wyper, Partner swy@bto.co.uk / Jeremy Glen, Partner jsg@bto.co.uk / Alastair Dunn, Partner akd@bto.co.uk / Emma Barclay, Partner eba@bto.co.uk / T. 0141 221 8012