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A commercial agency agreement under Dutch law (agentuurovereenkomst) is a contract in which a self-employed agent acts as an intermediary in bringing about contracts for a principal, and may conclude them in the principal’s name, for remuneration and without being subordinate to the principal (article 7:428 Dutch Civil Code). Articles 7:428-7:445 set largely mandatory rules on commission, notice periods, goodwill compensation and non-compete clauses.
This page explains what the agreement must contain, how commission and goodwill work, and how it can be terminated. Our agency agreement lawyers in the Netherlands draft and review agency contracts and act in commission, termination and goodwill disputes.
What is a commercial agency agreement under Dutch law?
The agent is independent: it is not subordinate to the principal and is therefore not its employee. The agreement can be for a fixed or an indefinite period, and the agent usually earns commission on the contracts it brings in. The statutory agency rules do not apply to agency agreements governed by the Financial Supervision Act (Wet op het financieel toezicht) (article 7:428(2)).
What is the difference between a commercial agent and a distributor?
A distributor buys products from its supplier and resells them in its own name and for its own account, earning a margin. A commercial agent does not buy the goods: it brings about contracts for the principal and earns commission. Dutch law has no specific statutory regime for distribution agreements, so the general law of contract applies to them. We explain the consequences on the page on the difference between distribution and agency under Dutch law.
Is Dutch commercial agency law mandatory?
Yes, to a large extent. Article 7:445 of the Dutch Civil Code lists the provisions the parties cannot deviate from at all, such as the minimum notice periods, the rules on termination and damages and the limits on non-compete clauses. It also lists provisions they cannot deviate from to the agent’s detriment, such as the goodwill rules before the agreement has ended. A clause that conflicts with a mandatory provision is void (nietig) or, where the provision only protects one of the parties, voidable (vernietigbaar), unless the purpose of the provision implies otherwise (article 3:40(2) Dutch Civil Code).
For example, the parties cannot validly agree in advance to exclude the agent’s goodwill payment on termination, because that protection is mandatory. Where the agent operates in the Netherlands and the parties made no valid choice of law, Dutch courts generally apply Dutch law, and they will set aside a chosen law that has no real connection with the relationship.
This matters when you draft the contract, because a clause that would be enforceable in another country can be void or voidable here. A Dutch contract lawyer can check an agency agreement against the mandatory rules before you sign it.
What must a commercial agency agreement contain?
An agency agreement does not need to be in writing to be valid. But each party can ask the other for a signed document setting out the current terms (article 7:428(3)), and several clauses are only effective if they are agreed in writing.
A non-compete clause is one (article 7:443(1)). A del credere clause, under which the agent accepts liability towards the principal for a customer’s obligations, is another (article 7:429(1)). Unless agreed otherwise in writing, a del credere agent is only liable for the customer’s solvency, and in principle for no more than the agreed commission (article 7:429(2) and (3)). Setting out the territory, the products, the commission and the notice period in writing also prevents many later disputes, even where the law does not strictly require it.
An agent whose business is established in the Netherlands must have it registered in the Trade Register (handelsregister) of the Chamber of Commerce (articles 5 and 18 Trade Register Act 2007). A foreign principal without an establishment in the Netherlands is in principle not registered there. If a registered business has authorised commercial agents (gevolmachtigde handelsagenten) working in the Netherlands, their details and the content of their power of attorney are entered in the register (article 12 Trade Register Decree 2008). For a registrable business established abroad, the duty to file also rests on the person in charge of the day-to-day management of its main establishment (hoofdnederzetting) or, if there is none, on the authorised commercial agent it has designated (article 18(4) Trade Register Act 2007).
Are non-compete clauses valid in an agency agreement?
Only within limits. Under article 7:443 of the Dutch Civil Code a non-compete clause is valid only if it is in writing, relates to the type of goods or services the agent represented and to the territory, or the customer group and the territory, entrusted to the agent, and lasts no longer than two years after the agreement ends. The principal cannot rely on the clause if it ended the agreement itself without the agent’s consent, without observing the notice period and without an urgent cause communicated without delay, or if the agent ended it for an urgent cause, communicated to the principal without delay, for which the principal is to blame, or if it ended by a court decision based on circumstances for which the principal is to blame (article 7:443(3)). At the agent’s request, a Dutch court may annul a non-compete clause in whole or in part if it unfairly prejudices the agent in relation to the interest of the principal that the clause protects (article 7:443(4)).
How is the agent’s commission calculated?
The agent’s right to commission is governed by article 7:431 of the Dutch Civil Code. During the agreement, the agent is entitled to commission where:
- the contract was brought about through the agent’s work;
- the contract was concluded with a customer the agent had previously introduced for that kind of contract; or
- the contract was concluded with a customer from the territory or client base assigned to the agent, unless it was expressly agreed that the agent has no exclusive right there.
The agent is also entitled to commission on a contract concluded after the agreement has ended if that contract is mainly due to the agent’s work during the agreement and was concluded within a reasonable period after the end, or if the agent or the principal received the customer’s order before the end (article 7:431(2)). Where the agent only acted as an intermediary, an order it passed on is deemed accepted for commission purposes unless the principal refuses it or makes a reservation within a reasonable period, which is one month if the contract sets no period (article 7:432(1)). A clause making commission depend on performance of the contract must be agreed expressly; the right then arises at the latest when the customer has performed its part, or should have done so if the principal had performed its own part (article 7:432(2) and (3)).
The principal must give the agent a written statement of the commission owed for each month, before the end of the following month; the parties may agree in writing on a statement every two or three months. The agent may inspect the supporting documents (article 7:433). Commission becomes payable at the latest when that statement is due (article 7:434).
Because commission often turns on who brought about a contract, an agent should keep clear records of its work: quotations, introductions, meetings and orders. Without that evidence an agent may be unable to show which of its efforts led to a sale, and a commission claim can fail on that point alone.
What obligations does the principal have toward the agent?
The agency rules bind the principal too, not only the agent. The principal must do whatever is necessary on its side to enable the agent to do its work, provide the necessary documentation on the goods or services and all information the agent needs, and inform the agent within a reasonable time whether it has accepted, refused or not performed a contract the agent brought in. It must warn the agent without delay if it expects to conclude significantly fewer contracts than the agent could expect (article 7:430). If the principal makes no use, or considerably less use than the agent could normally expect, of an agent that is willing to perform, the agent is entitled to remuneration, unless this results from circumstances that cannot reasonably be attributed to the principal (article 7:435).
How can a commercial agency agreement be terminated?
A fixed-term agreement cannot be ended early by ordinary notice unless the contract allows it (article 7:437(1)), although termination for an urgent cause (dringende reden) and dissolution by the subdistrict court (kantonrechter) remain possible (articles 7:439 and 7:440 of the Dutch Civil Code). If both parties continue it after its end date, it becomes an open-ended agreement on the same terms (article 7:436).
An open-ended agreement is ended by notice, given for the end of a calendar month. If the parties agreed no notice period, it is four months, plus one month after three years and two months after six years. An agreed period cannot be shorter than one month in the first year, two months in the second year and three months after that; if the parties agree longer periods, the principal’s period may not be shorter than the agent’s (article 7:437).
A party that ends the agreement without observing its term or the notice period, and without the other party’s consent, must pay damages, unless it ended the agreement for an urgent cause that it told the other party without delay (article 7:439(1)). The damages equal the remuneration for the period the agreement should have continued; the court may reduce that amount, and the injured party may instead claim its full loss if it proves it (article 7:441).
The wording of the notice clause and the reason for ending the relationship therefore decide most termination disputes. Our page on termination of a commercial agency contract under Dutch law sets out the steps in more detail.
Is the agent entitled to a goodwill payment on termination?
Often, yes. Under article 7:442 of the Dutch Civil Code the agent is entitled to a goodwill payment (klantenvergoeding), regardless of any claim for damages, if it brought in new customers or significantly grew business with existing customers, the principal still derives substantial benefits from those customers after termination, and payment is fair in view of all circumstances, in particular the commission the agent loses.
No goodwill payment is due if the principal ended the agreement because of an urgent cause for which the agent is to blame, if the agent itself ended it (unless that was justified by circumstances attributable to the principal, or by the agent’s age, infirmity or illness), or if the agent, by agreement with the principal, transferred its rights and obligations under the agreement to a third party (article 7:442(4)).
The payment is capped at the agent’s average annual remuneration over the last five years, or over the actual shorter period if the agreement lasted less than five years. See our page on goodwill compensation for commercial agents.
How long do you have to claim goodwill compensation?
The right to goodwill compensation lapses if the agent has not told the principal, at the latest one year after the agreement ended, that it claims compensation (article 7:442(3) of the Dutch Civil Code). Separately, claims based on articles 7:439 and 7:440 (damages for irregular termination, and damages or compensation after dissolution by the court) become time-barred one year after the event that gave rise to them (article 7:444).
That one-year limitation period can be interrupted, for example by a written demand for payment (article 3:317(1) of the Dutch Civil Code). The one-year deadline for the goodwill notice is a lapse period (vervaltermijn), so the notice must reach the principal within the year. Acting in time is essential.
What does a goodwill claim look like in practice?
Suppose an agent spends four years building a customer base in the Netherlands for a foreign principal, and the principal then ends the agreement to sell to those customers directly.
Because the principal keeps benefiting from the customers the agent introduced, the agent will usually be entitled to a goodwill payment under article 7:442, provided the payment is fair in view of all circumstances, including the commission it loses. Assuming the principal had no urgent cause, none of the exclusions applies. The payment cannot exceed one year’s remuneration, calculated on the average over the four years, and the agent must tell the principal within one year after the end that it claims compensation. The agent’s detailed records of which customers it introduced are what make such a claim succeed, which is why documentation matters from day one.
Frequently asked questions about commercial agency agreements in the Netherlands
Does a commercial agency agreement in the Netherlands have to be in writing?
No. A Dutch agency agreement is valid without a written document, but each party can ask the other for a signed document setting out its terms (article 7:428(3) Dutch Civil Code). A non-compete clause (article 7:443) and a del credere clause (article 7:429) are only effective if they are agreed in writing.
What is the notice period for terminating an agency agreement under Dutch law?
If nothing was agreed, four months, plus one month after three years and two months after six years, given for the end of a calendar month. An agreed period may not be shorter than one month in the first year, two in the second and three after that (article 7:437 Dutch Civil Code). Ending the agreement without notice requires an urgent cause or the other party’s consent; otherwise the terminating party must pay damages (articles 7:439 and 7:441).
How much goodwill compensation can a commercial agent claim?
At most one year’s remuneration, calculated on the average of the last five years, or of the whole term if the agreement was shorter (article 7:442(2) Dutch Civil Code). The payment must also be fair in view of all circumstances, it is excluded in the cases of article 7:442(4), and the agent must tell the principal within one year after the agreement ended that it claims compensation (article 7:442(3)).
Is a commercial agent entitled to commission after the agency agreement ends?
Yes, for contracts concluded within a reasonable period after the end that are mainly due to the agent’s work during the agreement, and for orders the agent or the principal received before the end (article 7:431(2) Dutch Civil Code). A successor agent then has no right to that commission, unless the circumstances make it fair to share it (article 7:431(3)).
Can the parties choose a foreign law for a Dutch agency agreement?
They can make a choice of law, but where the agent operates in the Netherlands the mandatory provisions of Dutch agency law still apply, and a Dutch court may set aside a chosen law that has no real connection with the relationship.
Primary sources
- Dutch Civil Code Book 7 (Burgerlijk Wetboek): Articles 7:428, 7:429, 7:430, 7:431, 7:432, 7:433, 7:434, 7:435, 7:436, 7:437, 7:439, 7:440, 7:441, 7:442, 7:443, 7:444 and 7:445
- Dutch Civil Code Book 3: Articles 3:40 and 3:317
- Trade Register Act 2007 (Handelsregisterwet 2007): Articles 5 and 18
- Trade Register Decree 2008 (Handelsregisterbesluit 2008): Article 12
Speak to a Dutch commercial agency lawyer
Whether you are drafting an agency agreement, negotiating a non-compete, or facing termination and a goodwill claim, the mandatory rules of Dutch agency law shape your position.
Our Dutch commercial agency lawyers draft and review agreements and advise principals and agents on commission, termination and goodwill. This work sits within our wider Dutch contract law practice. Contact us to review your commercial agency agreement.
