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Distributorship agreement
Distributorship agreement is an agreement providing that one party (a distributor) undertakes to buy the goods from the other party (a supplier), and the distributor is in charge of the sales promotion in the specified territory. According to this agreement the supplier undertakes not to sell the goods in the contractual territory except to the distributor and not to carry out any direct activities in the area reserved to the distributor, as well as is not entitled to conclude with third parties, acting on the contractual territory, the agreements similar to the distributorship agreement as well as other contracts provided for the goods to be delivered by the supplier on the contractual territory.
Distributorship agreement can be related to the intermediary agreements. A distributorship agreement is not provided for by the Civil Code of the Russian Federation. However according to Russian law the parties are entitled to conclude agreements which are specified by the legislation or not.
While concluding a distributorship agreement the following is necessary to take into account:
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Exclusivity: exclusive right provided for by a distributorship agreement as well as by an agency agreement is considered as the distributor's right to reserve the territory for the goods promotion and organization of distribution in this territory. The supplier confers a privileged position in the territory on the distributor. Suppler shall not to conclude with third parties, acting on the contractual territory, the similar agreement and the contracts provided for the goods to be delivered by the supplier or by a third party on the contractual territory.
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Definition of the contractual products: the goods covered by a distributorship agreement as well as by an agency agreement should be defined with care, since the most important obligations of the supplier - such as exclusivity - and of the distributor - such as sales promotion, non-competition, etc. - are determined by the reference to the products.
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The distributorship agreement should specify the territory or territories in which the distributor is to carry out his operations. It's important for the parties to pay particular attention to defining the territory. Any lack of clarity may be a source of conflict, in particular between different distributors responsible for selling the same product.
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Distribution network creates by virtue of conclusion of the agreements with sub-distributors or agents. The parties to the agreement define how much control the supplier will exercise over the identity of the members of the network. A distributorship agreement can provide for: a) total freedom on the part of the distributor in his choice of partners; b) compulsory prior authorization from the supplier; c) simple obligation to inform, etc.
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Use of the supplier's trademarks: the terms on which the distributor may or must use the supplier's trademarks have to be clearly defined. The distributor may undertake to bring the supplier's trademark to the public's attention (by using it in his advertising, etc.), and at the same time not to register it in his own name, or not to use it for any activity other than the promotion of the sale of the contractual goods.
We will assist you:
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If you intended to conclude a distributorship agreement, the draft of which offered by your partner, we will analyze it, discover the possible risks, offer the version that will let you reach a reasonable compromise and negotiate this agreement with your business partner.
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If you need to have the draft of a distributorship agreement, we will make it with due consideration of the acquired information related to the future operations and our experience.
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If you are interested in the conclusion of a distributorship agreement with your partner, we will assist you to check the status of your partner, and provide the contract to be duly signed by the authorized representatives of your partner, etc.
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In any case we will help you to draft and conclude a distributorship agreement on the terms and conditions that are the best suitable for you. You will need only to sign the completed contract.
We appreciate our clients and keep the confidentiality of the acquired information with due care.
To obtain the information concerning our legal services, terms, fees, as well as to apply for the legal services you need please contact us:
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