Hardly a week goes by without a company confidently telling one of my law firm’s international lawyers how they will be working with a great distributor to get their product(s) into a particular foreign market. Our job as their lawyers is to write an enforceable international distribution contract to protect them.
Our international distribution contracts typically provide for the following, among other things:
- An exclusivity provision, or not
- Whether the distributor can subcontract out distribution, or not
- The geographic and market territory given to the distributor
- The term of the distribution agreement and what must be done to renew or terminate it
- The specific products covered by the distribution agreement
- The methods the distributor can use to sell the products
- The pricing the distributor can use for the products
- Payment terms
- The distributor’s performance and sale requirements
- Ordering and shipping procedures
- Who is in charge of what when it comes to such things as defective products, advertising, warranties, technical support, obtaining permits, etc.
- FCPA compliance. Anti-corruption compliance
- Rights regarding new or modified products
- Whether the distributor can or cannot sell the products of others
- All sorts of things relating to intellectual property (trade secrets, trademarks, patents, copyrights, etc.)
- Non-competition during or after the term of the distribution agreement
- Damages for breaches
- Trademark licensing and brand name usage
- Dispute resolution (venue, choice of law, etc.)
I know the above sounds like a handful (and this is only part of what often goes into such contracts), but for lawyers who do these contracts all the time, even complicated international distribution contracts become at least somewhat standard.