What is an international distribution contract?

It is an agreement in which the Provider or Supplier assigns the right to commercialize its products for a period of time to the Distributor so that the latter can commercialize it in the destination country, which is its own commercial network.

It is an atypical contract, that is, what is agreed between the parties prevails, as long as it does not affect public order, good customs or mandatory regulations.

What are the most common clauses of an international distribution contract?

1.-The territory and the products, 2.-The supply, 3.-The minimum sales quota, 4.-Confidentiality, 5.-Termination of the international distribution contract, 6.-Obligations of the distributor, 7.-Obligations of the supplier, 8.-Applicable jurisdiction in case of conflict, 9.-Non-competition agreement, 10.-Prices and commercial margins, 11.-Patents and trademarks, 12.-Sanitary Registries according to the case, 13.-Systems of Information between the Supplier and Distributor, 14.-Promotion and advertising, 15.-Indemnities, 16.-Excess stock, 17.-Business expenses by the distributor, 18.-Minimum annual purchase volume and others.

What are the risks that may arise from this contract?

1.-Restriction of free competition, that is to say, that other distributors will not be able to commercialize the products of the Provider or Supplier in a determined territory.

2.-Unfair competition, it may happen that a Distributor enters into an international distribution contract with another Provider or Supplier.

What is the duration of international distribution contracts?

It can last between three to ten years. The most common is five years.

How is an international distribution contract developed with a North American Supplier?

Normally they usually write the international distribution contract and establish that the North American law of the state to which they belong is applied, through arbitration in that same country.

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