1.
INTERNATIONAL DISTRIBUTION CONTRACT
1. Definition
2. Parties to the Contract
3. Main clauses
3.1 Exclusivity
3.2 Commitment not to compete
3.3 Minimum sales targets
3.4 Conditions of sale
3.5 Advertising and publicity
4. Law applicable
5. Model Contract
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2.
The International Distribution Contract is designed to be used
where a Supplier grants to a Distributor the right to promote
and commercialize merchandise under its own name and on its
own account with the intention of re-selling it to end clients or
retailers located in an agreed territory.
This contract can be used for the international distribution of
different types of products such as food, beverages, consumer
goods, industrial supplies, machinery, etc.
1. DEFINITION
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3.
Usually both the Supplier and the Distributor are
companies. For each party, the following has to be
included:
• Name of company, full address and nationality.
• Company type: public limited company, limited
liability company, etc.
• Name and position of company representative
who signs the agreement.
• Tax ID number of both parties.
2. PARTIES TO THE CONTRACT
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4.
Some of the most important clauses in the International
Distribution Contract are as follows:
• Exclusivity
• Commitment not to compete
• Minimum sales targets
• Conditions of sale
• Advertising and publicity
3. MAIN CLAUSES AND SAMPLE
See sample of International Distribution Contract
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5.
“For the duration of the present Contract, the Supplier grants
the Distributor the exclusive right to commercialize and sell the
Products within the Territory.”
“Should the Supplier sell any other product within the Territory,
they shall inform the Distributor in order to determine the
possibility of including it in the products described in the Annexes
of the present Contract.”
3.1 EXCLUSIVITY
See sample of International Distribution Contract

6.
3.2 COMMITMENT NOT TO COMPETE
“The Distributor shall not manufacture, distribute or represent any
kind of product which may compete directly with the Products without
previous authorization in writing from the Supplier. To this end the
Distributor declares that on the date of the signing of the present
Contract, it acts as an agent or distributor for the companies and products
detailed in the Annexes of this Contract.”
“The commitment not to compete shall be upheld throughout the
duration of the present Contract and for ...... years after its completion.”
See sample of International Distribution Contract

7.
“Should the Distributor not have achieved the minimum sales targets on completion
of the period in question, the Supplier shall be entitled to choose from the following
options: (a) total rescission of the Contract; (b) withdrawal of the right to exclusivity,
where such right has been established; (c) reduction of the size of the Territory.”
“The Supplier shall inform the Distributor in writing of the decision to exercise
this right within a period of ...... months following the end of the year in which the
minimum sales targets has not been achieved.”
3.3 MINIMUM SALES TARGETS
See sample of International Distribution Contract

8.
“The sale of Products shall be effected according to the general conditions of
sale established in the Annexes of the present Contract. The Supplier shall
deliver the products to ............................... [mention the place: warehouse, port, airport,
etc], .......................... [city], ................................. [country], under conditions
............................... [Incoterms].”
“The Distributor agrees to comply, with the utmost care, with the terms of
payment agreed between the Parties.”
“It is agreed that the Products remain property of the Supplier until the
Distributor has completed payment for the consignment.”
3.4 CONDITIONS OF SALE
See sample of International Distribution Contract

9.
“Both parties may agree to joint activities of advertising and publicity
(publishing catalogues, mail marketing, point-of-sale promotions,
participation in trade fairs, advertising in Internet, etc.).”
“The costs of advertising and publicity shall be met by both parties
and according to the following proportions: Supplier ....... %;
Distributor ...... %.”
3.5 ADVERTISING AND PUBLICITY
See sample of International Distribution Contract

10.
The Parties shall exercises their best efforts to resolve by
negotiation any dispute, controversy o difference between
them arising out or relating to this Contract.
The parties are free to submit any conflicts regarding the
agreement to International Arbitration or to the Laws of the
country of one of the parties.
The conflicts will normally be subject to the Courts of the
country of the Distributor and, specifically, to those of the
town/city where it has its registered offices.
4. LAW APPLICABLE
See sample of International Distribution Contract

11.
In order to obtain the model contract in Word format and
the user guide, click on:
International Distribution Contract
5. MODEL CONTRACT
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