INTERNATIONAL DISTRIBUTION AGreeMent

1. Denition 2. Parties to the Agreement 3. Main clauses 3.1 Exclusivity 3.2 Commitment not to compete 3.3 Minimum sales targets 3.4 Conditions of sale 3.5 Advertising and publicity 4. Applicable Law 5. Model Agreement
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1. DEFINITION

The International Distribution Agreement is designed to be used where a Supplier grants to a Distributor the right to promote and commercialize merchandise under its own name and on its own account with the intention of re-selling it to end clients or retailers located in an agreed territory. This agreement can be used for the international distribution of different types of products such as food, beverages, consumer goods, industrial supplies, machinery, etc.

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2. PARTIES TO THE AGreeMent Usually both the Supplier and the Distributor are companies. For each party, the following has to be included: Name of company, full address and nationality. Company type: public limited company, limited liability company, etc. Name and position of company representative who signs the agreement. Tax ID number of both parties.
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3. MAIN CLAUSES AND SAMPLE Some of the most important clauses in the International Distribution Agreement are as follows: Exclusivity Commitment not to compete Minimum sales targets Conditions of sale Advertising and publicity See sample of International Distribution Agreement
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3.1 EXCLUSIVITY

For the duration of the present Agreement, the Supplier grants the Distributor the exclusive right to commercialize and sell the Products within the Territory. Should the Supplier sell any other product within the Territory, they shall inform the Distributor in order to determine the possibility of including it in the products described in the Annexes of the present Agreement.

See sample of International Distribution Agreement

3.2 COMMITMENT NOT TO COMPETE

The Distributor shall not manufacture, distribute or represent any kind of product which may compete directly with the Products without previous authorization in writing from the Supplier. To this end the Distributor declares that on the date of the signing of the present Agreement, it acts as an agent or distributor for the companies and products detailed in the Annexes of this Agreement. The commitment not to compete shall be upheld throughout the duration of the present Agreement and for ...... years after its completion.

See sample of International Distribution Agreement

3.3 MINIMUM SALES TARGETS

Should the Distributor not have achieved the minimum sales targets on completion of the period in question, the Supplier shall be entitled to choose from the following options: (a) total rescission of the Agreement; (b) withdrawal of the right to exclusivity, where such right has been established; (c) reduction of the size of the Territory. The Supplier shall inform the Distributor in writing of the decision to exercise this right within a period of ...... months following the end of the year in which the minimum sales targets has not been achieved.

See sample of International Distribution Agreement

3.4 CONDITIONS OF SALE

The sale of Products shall be effected according to the general conditions of sale established in the Annexes of the present Agreement. The Supplier shall deliver the products to ............................... [mention the place: warehouse, port, airport, etc], .......................... [city], ................................. [country], under conditions ............................... [Incoterms]. The Distributor agrees to comply, with the utmost care, with the terms of payment agreed between the Parties. It is agreed that the Products remain property of the Supplier until the Distributor has completed payment for the consignment.

See sample of International Distribution Agreement

3.5 ADVERTISING AND PUBLICITY

Both parties may agree to joint activities of advertising and publicity (publishing catalogues, mail marketing, point-of-sale promotions, participation in trade fairs, advertising in Internet, etc.). The costs of advertising and publicity shall be met by both parties and according to the following proportions: Supplier ....... %; Distributor ...... %.

See sample of International Distribution Agreement

4. Applicable LaW The Parties shall exercises their best efforts to resolve by negotiation any dispute, controversy o difference between them arising out or relating to this Agreement. The parties are free to submit any conicts regarding the agreement to International Arbitration or to the Laws of the country of one of the parties. The conicts will normally be subject to the Courts of the country of the Distributor and, specically, to those of the town/city where it has its registered offices.
See sample of International Distribution Agreement

5. MODEL AGreeMent

In order to obtain the model agreement in Word format and the user guide, click on: International Distribution Agreement

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