Agency and Distribution Agreements Lawyers in Spain
We help you draw up agency and distribution agreements and resolve disputes arising in cross-border trading between third countries and Spain.
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Under an agency agreement, an independent self-employed individual or corporate entity (the “agent”) undertakes, on an on-going basis and in return for remuneration, to promote, or promote and conclude, commercial transactions on behalf of and in the name of another person (the “principal”).
Protection for Agents
Agency agreements in Spain are regulated by the Agency Agreements Law 12/1992. There are a number of protections for agents under the law, including:
- a minimum notice period of one month for every year that the agreement is in place (up to a total of six months),
- right to an indemnity for increase in customer base or growth in sales with existing customers over the duration of the agreement, and
- rights concerning the payment of commission.
A distribution agreement is a contract between a distributor and manufacturer in which the distributor agrees to purchase goods (or services) from the manufacturer and resell them at its own risk. There is no specific regulation of distribution agreements in Spanish law, thus the general principles of contracts in the Civil Code apply.
Protections for distributors
- An essential element in every distribution agreement is the terms as to exclusivity. These may be:
- Exclusive distributorship: the manufacturer undertakes only to sell the product to the exclusive distributor within the specified territory and not to sell the products in the territory itself
- Non-exclusive distributorship: the manufacturer can sell to more than one distributor and end-users in the specified territory
- Sole distributorship: the manufacturer undertakes only to sell the product to the exclusive distributor within the specified territory but reserves the right to supply the products to end-users or specified customers in the territory.
- Selective distributorship: There is no territorial or customer exclusivity but the manufacturer (typically in the luxury goods or technical consumer product sectors) restricts the sale of products only to distributors within the selective distributorship network and to end-users wherever they are located.
How are disputes handled?
Disputes involving distribution agreements are based on the terms of the contract and when deciding a case, the Spanish courts may apply by analogy the Commercial Agency regulations to the contract in respect of the calculation of the indemnity payable by the manufacturer or the period of notice of termination.
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