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LPC Law Notes International Commercial Law Notes

Marketing Agreements Notes

Updated Marketing Agreements Notes

International Commercial Law Notes

International Commercial Law

Approximately 179 pages

A collection of the best notes for new University of Law module 'International Commercial Law' the director of Oxbridge Notes (an Oxford law graduate) could find after combing through dozens of LPC samples from outstanding students with the highest results in England and carefully evaluating each on accuracy, formatting, logical structure, spelling/grammar, conciseness and "wow-factor".

In short, these are what we believe to be the strongest set of International Commercial Law notes available...

The following is a more accessible plain text extract of the PDF sample above, taken from our International Commercial Law Notes. Due to the challenges of extracting text from PDFs, it will have odd formatting:

  • Relationship whereby one party (principal) give another (agent) authority to act on her behalf

  • Contracts concluded by agent are binding between principal and TP, if agent has authority

Types of Agency Agreement
  • Sales agency agreement: agent is intermediary; title in goods passes directly from principal to TP; agent can conclude contracts directly with TP

  • Other types: ‘marketing’ or ‘introducing’ agreements: agent introduces client to customers (causing them to enter contract), even negotiates terms, but no authority to conclude contract

  • Court will pay more attention to actual relationship than to labelling of agreement

Types of authority
Express authority Scope of agent’s authority set out expressly in agreement
Implied / actual authority

May arise in two ways:

1) Agent has implied authority to do things incidental to performance of duties

2) Implied authority arises out of customs of particular trade

Apparent / ostensible authority

Arises where principal has given distinct but false impression that agent had authority to enter into a particular contract.

Authority arises from estoppel if:

1) At some stage, principal represented (by words or conduct) that agent had authority

2) TP must rely on that representation, believing agent had authority

3) TP must alter his position, by entering transaction (Freeman & Lockyer v Buckurst Part Properties [1964])

Authority by ratification Where agent does not have authority, or has exceeded authority, principal may ratify acts
Authority arising by customer ?
Principal and TP Agent and TP Principal and agent
Actual authority (express / implied) Contract between principal and TP; each party can sue the other Contract is between Principal and TP (Agent drops out) N/A
Apparent authority Contract between Principal and TP; each party can sue the other; Principal estopped from denying contract Contract between Principal and TP; Agent drops out of picture Principal may be able to bring actions against Agent if acted outside authority
No authority No contract between Principal and TP TP may sue Agent in deceit, where Agent knew s/he had no authority; cannot sue for breach of contract Agent may be liable to Principal if latter suffers loss
Disclosed / Undisclosed Principal
  • Disclosed principal: TP is aware Agent is acting on behalf of another person; that person may be “identified” (TP knows identity) or “unidentified” (TP does not know identity)

  • Undisclosed principal: if not disclosed to TP that Agent acting as agent+TP thinks s/he is dealing with Principal, TP has a choice: if Agent acted w/in authority, TP may sue Principal or Agent

Restraint of trade
  • Usually valid in context of agency agreements, for duration of agreement, if in writing and reasonable for protection of valid business interests and not contrary to public interest

  • Must relate to the geographical area, customers and goods under agency; no more

  • Must last for no more than 2 yrs from termination

  • Must comply with competition law principles; if Agent is not “commercial agent”, post-termination restraint of trade clause will not be valid

  • Types: restrictions related to any grant of exclusivity; obligation not to sell competing products

Exclusive, non-exclusive and sole agents
  • Exclusive rights: prevent Principal from actively seeking sales in Agent’s territory and from appointing other Agents / Distributors there; Principal may reserve certain rights (continued right of supply to named (groups of) customers

  • Sole rights: prevent Principal from appointing other Agents / Distributors in the territory, but not from actively seeking sales itself

  • Non-exclusive rights: Principal is free to appoint other Agents etc and to actively seek sales

  • Principal may also reserve right to convert from one type to another (e.g. sole rights to non-exclusive), contingent on, e.g. sales figures

Exclusive agency / distributorship
  • P agrees not to appoint other As / Drs in territory

  • Also agrees not to sell products itself within territory

Sole agency / distributorship
  • P agrees not to appoint any other As / Drs in territory

  • Remains free to sell products in territory itself

Non-exclusive agency / distributorship
  • P can appoint other As / Drs in territory

  • Can sell products in territory

  • Supplier sells goods to Distributor, which then re-sells them on its own behalf

  • E.g. manufacturer – wholesaler – retailer

  • Title in goods passes from Principal to Distributor to customer; contractual relationships are:

  • Principal Distributor

  • Distributor Agent

  • No contractual relationship between Principal + customers (may be tortious liability)

Mixed arrangements
  • Note that it is possible for an Agent to be both a sales Agent and a Distibutor for the same Principal in relation to different products

Agency Distribution
Agent (A) appointed by principal (P) under agency agreement. A receives commission (usually agreed percentage of sales or introductions). Can be used for marketing services as well as goods. Supplier (S) enters distribution agreement with distributor (D). D buys the goods from S for resale, and retains all profits from resale. Generally only suitable for marketing goods.
Requires close supervision by P. Less suitable if A + P are based in different countries or P has ltd time. More suitable for bespoke products, those requiring close contact / after-sales service. Useful to protect brand/ rep. Requires ltd supervision. D decides how and where to market goods. More suitable for mass-produced products or where S likely to encounter unfamiliar markets / language problems. More difficult to protect brand / rep.
More suitable where direct contact is needed between Principal + customer (bespoke work / specialist after-care) More suitable where there is no need for direct relationship between...

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