Distribution Agreements in Belgium
Distribution Agreements in BelgiumUpdated on Thursday 21st July 2016
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The distribution agreements are used in commercial activities in which a party grants the right to distribute his or her services and products to another party. The distribution agreements establish the relations between the parties, the obligations and rights of those involved, the prices, and the conditions in which the agreement can terminate. Businessmen who are interested in drafting distribution agreements in Belgium can receive assistance on this matter from our team of Belgian lawyers, who can provide an in-depth presentation on the legal requirements which should be met by such documents.
The legislation referring to the Belgian distribution agreements
Investors who set up a company which can enter into a distribution relationship with another party should know the legal requirements of the agreement. As a general rule, the Belgian legislation has introduced in its national law most of the European Union’s (EU) directive referring to the distribution agreement.
It is important to know that legal entity distributing the products (named “the principal”) can enter into a free commercial relationship with another party (named “the distributor”) through a distribution agreement in which the parties involved can establish the conditions of the collaboration.
However, the Belgian legislation, harmonized with the EU’s directives, prescribes that the parties can’t impose price fixing terms, as these would enter into conflict with the regulations referring to free competition; our team of Belgian lawyers can provide more details on these directives.
The distribution legislation in Belgium
Although the Belgium law is mainly aligned with the EU’s legislation, it is necessary to know that the local authorities have created a different legal environment for the termination of exclusive distribution agreements.
Those who want to establish business relations on the Belgian market should know that, under the 1961 Act, the distributor is protected in the situation in which an indefinite term distribution agreements terminates.
At the same time, the Act provides a legal framework for the termination of fixed term contracts. It is important to know that such contracts will still be considered valid after the termination date, if the parties did not provide a notice of termination.
Businessmen interested in how to draft a distribution agreement under the rules of the local law, can address to our Belgian law firm.