The starting point is that international distribution agreements generally contain details on specific products and the specific area that will be included in the contract. Can the distributor compete with the manufacturer after the contract expires? The general principle of the law is that non-competition, where it must be conducted reasonably and for a commercial purpose, is enforceable. If it is a mere “naked reluctance to compete,” or if it is broad enough to be unreasonable, it will not apply. The issues that the court will consider are often the sellers do not have written distribution agreements on the spot, but it will be dictated by the conditions of the seller for the delivery of the goods. Greenaway Scott is considering how to terminate a sales contract subject to the seller`s terms and conditions under UK law. When a supplier or distributor seeks legal advice when entering into a new distribution contract, the first thoughts focus on customer-specific issues. Is a general boilerplate contract sufficient or does the customer want or need a contract specifically tailored to their sector or business relationship? When reviewing a distribution agreement, the parties must have done their homework. Is this a situation in which the other side has shown that he is capable of playing well with others? Has a lawyer asked to intervene to design the contract? Do you know if either party has a well-established history/reputation compared to its former distributors or old distribution contracts? You may have the best product in the world, but if the supplier`s history is a scorched earth dispute when each sales contract is concluded, you can pass on the distribution. If the supplier is willing to share some “control” with the dealer or it will be “their way or the highway”.

Specific issues to be included in the contract include the duration of the agreement, the required service, exclusivity or non-exclusivity, the definition of territorial boundaries, the definition of the transfer of material and the specific definition of terms of sale. In addition, these contracts should include specific conditions for authorized or necessary marketing and advertising, the need to account for activities and sales, consideration of what is considered competitive, regardless of exclusivity decisions, concerns about trademarks and ip concerns, and the classic choice of legislation, both for interpretation and enforcement of the contract.