Distributor and third party relationships
Distributor and third party relationships

The following Commercial guidance note provides comprehensive and up to date legal information covering:

  • Distributor and third party relationships
  • Distributor and customer
  • Product liability
  • Distributor's terms of sale
  • Liability
  • Indemnities

Brexit: As of exit day (11pm on 31 January 2020) the UK is no longer an EU Member State. However, in accordance with the Withdrawal Agreement, the UK has entered an implementation period, during which it continues to be subject to EU law. This has an impact on this Practice Note. For further guidance, see Brexit Bulletin—key updates, research tips and resources and Brexit toolkit.

This Practice Note describes the extent of a distributor's liabilities towards third parties, including where it may incur primary product liability in place of the manufacturer for the goods it distributes.

Distributor and customer

A distributor buys products from a manufacturer and resells them on its own behalf. The contract and the relationship is between the end-user and the distributor, rather than the manufacturer, and it is the distributor to whom the customer will look for product maintenance or redress for defective products.

Product liability

Notwithstanding the distributor's contractual liability to customers for defective products, EU law holds manufacturers and others involved in the distribution chain strictly liable for damage or injury to third parties caused by product defects. In the UK, such liability arises under Part I of the Consumer Protection Act 1987 (CPA 1987, ss 1–9). For this reason, manufacturer’s will want to restrict distributors from admitting liability in respect of defective