Q&As

If a commercial agent’s appointment spans the UK, EEA and outside of the EEA, do the Commercial Agents (Council Directive) Regulations 1993 apply and if so how is the compensation principle applied?

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Published on LexisPSL on 05/06/2017

The following Commercial Q&A provides comprehensive and up to date legal information covering:

  • If a commercial agent’s appointment spans the UK, EEA and outside of the EEA, do the Commercial Agents (Council Directive) Regulations 1993 apply and if so how is the compensation principle applied?
  • Application
  • Impact of choice law
  • Compensation

We assume for the purposes of this Q&A that the contract is a commercial agency contract where the parties have specified the laws of England and Wales as its choice of governing law and jurisdiction and there is no clause stating the agent’s entitlement to indemnity on termination of the contract.

Application

Council Directive 86/653/EEC (Commercial Agents Directive) on the coordination of the laws of Member States relating to self-employed commercial agents was implemented into the UK by the Commercial Agents (Council Directive) Regulations 1993, SI 1993/3053 (Commercial Agents Regulations).

The Commercial Agents Regulations apply where the agent undertakes agency activities in England, Scotland and Wales, regardless of where the principal is located. Equivalent legislation applies in Northern Ireland. Similar provisions apply in each of the European Economic Area (EEA) countries. Each EEA country has their own implementing legislation and local legal advice should be sought in cases where the agent performs any of their duties in these countries. To the extent that the agreement extends beyond the EEA in respect of the agent’s activities, then local legal advice should be sought in those additional jurisdictions also.

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