Agency Law
AGENCY LAW NEWCASTLE & NEWCASTLE AGENCY AGREEMENT SOLICITORS
About Agency Law
This area of law is complex and there are many traps for the unwary. The use of business or sales agents has become far more common in the increasingly flexible labour market and there are clear advantages in this. However, such business arrangements are not wihout risk, particularly as Commercial Agency Regulations often apply.
The legal interpretation of agreements intended to be agency contracts can be problematic since the courts can sometimes interpret legal relationships between the parties in a manner which was not originally intended.
What are the advantages of using an agent ?
The main advantages of an agency agreement are perhaps :-
- If there is a need or intention to conduct business in a different country
- Utilising the services of an agent or consultant can help to reduce fixed costs if an agreement is reached for an agent to be paid only commission or a consultant is engaged only as and when needed and/or as funds permit
Another trap for the unwary relates to the potential problem of an agency agreement later being interpreted as an employment relationship, whereby the agent gains valuable and potentailly costly employment law rights. This is primarily because in this area of law, the label and wording put on a contract is not necesarily conclusive and the courts may look at the practical reality of the relationship.
Agency law is a regulated area, The Commercial Agency (Council Directive) Regulations 1993 give self employed sales agents rights, amongst other things, to minimum notice periods and compensation on termination.
For all the reasons described above, this is an area where it is recommended to have to have a carefully drafted agency agreement. This type of Agreement would be likley to include :-
- Clear parameters and restrictions on the agent’s role authority
- Commission levels
- Whether the agency is exclusive or not for the territory or product
- General provisions for terminating the agreement
- Events of breach and summary termination of the agreement
- Expenses of the Agent
If you are a business considering bringing in an agent or an agent offered a contract, please contact Newcastle agency law solicitors now