Commercial Agents Regulations: Am I entitled to compensation at the end of my agency contract?
QuestionI am a limited company (but one man-band)and have been working as an agent for five Italian manufacturers in the plumbing and heating business for nearly 30 years. Now I am 64 and I plan to retire in three to four years? time. With some manufacturers I have a basic agency contract and with others none, just a verbal agreement and never had any problems in getting my commissions. Under the Commercial Agents Regulations? am I entitled to any compensation at the end of my working relation with these Italian manufacturers? Thank you for your reply.
AnswerThanks for your question. I note that you’re working for Italian manufacturers, but the first thing I need to clarify is whether you are actually working in the UK or Italy? Im going to assume that you are working for them in the UK and that English law applies to your contracts. However, if not, then I would expect there to be similar provisions under Italian law as the purpose of the Commercial Agents Regulations was to harmonise laws across the European Economic Area. The first thing we need to check is whether the Commercial Agents Regulations apply to you. You will be a commercial agent if you are a:
- “self-employed intermediary” who has
- “continuing authority”
- to “negotiate”
- the sale or purchase of “goods” on behalf of another person (the principal), or to
- “negotiate and conclude”
- the sale or purchase of “goods” on behalf of and in the name of that principal.
What is the difference between an agent and a distributor and which is best for your business? If you want to grow your business and increase sales, you have a choice. You can either try to do everything yourself, or you can outsource the task by appointing an agent or distributor. __________________________________________________________________________________ Looking now at your specific question. It doesnt matter whether you have a written or a verbal agreement, the Commercial Agents Regulations will still apply. However, under the Regulations, you are entitled to a signed document confirming the terms of your agency agreement if you request it. you’re doing the right thing by planning ahead for your retirement. The Regulations provide minimum notice periods depending on how long the agreement has been in effect. These are:
- One month for the first year that the agreement;
- Two months for the second year and
- Three months for the third and subsequent years.