As a supplier, high-quality distribution contracts with your distributors work to your advantage. The same applies the other way around. Can you, as a supplier or distributor, also incur liability due to negligence arising from a defective product, and, if so, how can you shield yourself? What are the consequences if a supplier fails to perform adequately, and how can that risk be alleviated? Do you have your General Terms and Conditions available in writing, and are they up to date and applicable? Can a distribution contract under Dutch law be terminated if the contract does not specify how? What are the applicable limitation periods a distributor needs to be aware of? A distribution contract under Dutch law is not governed in the Dutch Civil Code. Please contact our distribution agreement lawyer in the Netherlands for all your challenges in the Netherlands.
Distribution agreement in the Netherlands
Our Dutch lawyers in the Netherlands will gladly explain your legal position regarding a distribution contract in the Netherlands and on the risks involved when both acting as a supplier or distributor. MAAK Advocaten helps suppliers and distributors reach favorable contracts under Dutch law with their suppliers and provides support in the sales process. Our attorneys in the Netherlands are dedicated attorneys in the Netherlands with one clear goal: to facilitate concrete deliverables that help to manage our clients’ interests in the Netherlands. Our Dutch lawyers in the Netherlands assist our clients in (commercial) litigation and Dutch contract law, with a particular focus on technology, IT, machinery and automotive. Our lawyers in the Netherlands are happy to be of assistance with regard to distribution contracts under Dutch law. Our law firm in the Netherlands represents the interests of both the principal (manufacturer) and the distributor or supplier in a dispute about an existing distribution agreement. Whether it concerns a provision in the distribution agreement, or the termination of the distribution agreement, our Dutch lawyers are able to initiate legal proceedings in the Netherlands before all civil courts.
EXCLUSIVE DISTRIBUTION AGREEMENT
The exclusive distribution agreement under Dutch law sets out the main (exclusive) arrangements between the supplier and the distributor. For example, a distribution agreement in the Netherlands is exclusive when only certain retailers are given the option of carrying a product in its store. Exclusive distribution is an agreement between a supplier and a retailer granting the retailer exclusive rights within a specific geographical area to carry the supplier’s products.
EXAMPLE EXCLUSIVE DISTRIBUTION Contract in Holland
Herewith an example of an exclusity clause (kindly note that there is always a chance that some information is not (or no longer) correct. MAAK Advocaten therefore accepts no liability whatsoever for the use of this information) If you wish to implement this clause, please contact us for further background information:
The territory is the Netherlands.
The distributor may not, directly or indirectly, actively promote, sell or purchase the goods (for example, through advertising or by establishing branches or distribution depots) in any other area outside the territory subject to any other agreement or variation.
The distributor shall only focus on the Dutch market and therefores the distributor may not actively market the goods outside the territory, even in the event that the potential buyers are located within the Netherlands.
Supplier grants the distributor the exclusive right to purchase, sell and distribute the goods solely in the territory for the term of this agreement.
Upon the principal’s request, the distributor will present (online) presentations about the goods in an informative manner and will discuss with principal any intended online presentation of the goods before implementing such presentations
Unlawful TERMINATION OF A DISTRIBUTION AGREEMENT
The correct termination of a distribution agreement under Dutch law could be quite complex. In a distribution agreement, you stipulate by what term and in what way you are able to terminate (in Dutch: ‘opzeggen‘) the distribution agreement. The notice period may be laid down in the distribution agreement. If a distribution agreement is defined for a definite period of time (e.g. a term of 5 years), the distribution agreement cannot generally be terminated prematurely. Your Dutch lawyer in the Netherlands can advise you on the contractual possibilities with regard to a valid termination.
In general, if supplier and distributor enter into a distribution agreement for an indefinite period of time, this distribution agreement can be terminated. The term by which the distribution agreement can be terminated depends on the circumstances of the case, such as the duration of the distribution agreement, but it may also be the case that there must be a substantial reason for a legally valid termination of the distribution agreement. Next to the above, additional compension might be obliged. There is a great deal of case law on this subject and our Dutch lawyers in the Netherlands will be happy to assist you.
GOODWILL COMPENSATION UPON TERMINATION OF A DISTRIBUTION AGREEMENT in the Netherlands
In the Netherlands a goodwill compensation upon termination of a distribution contract (and governed by Dutch law) is not possible. This is a huge different compared to a commercial agency contract under Dutch law. However, it is possible that compensation will follow when a distribution agreement is terminated. It is also possible that a compelling ground is required, or that a longer notice period is required in reasonableness and fairnes
DUTCH LAWYERS SPECIALIZED IN DISTRIBUTION CONTRACTS
You are advised to seek advice from a specialist Dutch lawyer when terminating a distribution agreement. Your Dutch lawyer can guide and advise you on your intention to terminate the distribution agreement. In addition, your Dutch lawyer can ensure that your termination is legally valid and that the formalities are met. If you have any questions, please do not hesitate to contact us: