The first question is whether the agreement can be considered solely under UK law or whether EU competition law is relevant. (Where both apply, EU principles have traditionally been a priority.) The answer will depend on where the effects of the agreement are felt. A commercial agent contract can be a very useful commercial contract if it is formulated with skill and the rights and obligations of the parties are clear. A commercial agent contract is a legally valid contract that creates a trust relationship in which the first party (“the principal”) agrees that the actions of a second party (“the agent”) bind the client to subsequent agreements of the agent, as if the contracting authority had itself concluded the subsequent agreements. The power of the agent to retain the client is generally considered to be a legal power. The agency created by an agreement can be a form of implied authority, for example: For example, when a person gives their credit card to a close relative, the cardholder may be asked to pay for the parent`s purchases with their credit card. Subject to modification by agreement and subject to the rules (if any), the agent has the following obligations: As a rule, the commission paid to an agent is less than the margin that a distributor will earn (since the distributor has taken a greater financial risk). The agency will therefore probably cost the supplier less than a distribution partnership, at least in everyday life. In situations where regulation does not apply (see below, but it is not always easy to decide), exiting an agency relationship, if things are not going well, can be cheaper for the supplier than that of a distribution company. Where the regulations apply, it is usually the other way around. In general, English common law has granted few rights to agents. It has been generally accepted that it is the client who needs protection against the agent and not the other way around.
This stems from an agent`s ability, under English law, to engage his or her sponsor in certain situations, even if he or she exceeds the jurisdiction conferred on him or her by his or her sponsor. Under Section 7, a business organization (including a business or partnership) is guilty of a criminal offence when a related person has bribed another person who intends to acquire or retain business for the commercial organization or to obtain or maintain a management advantage for the business organization. A person (A) is related to a relevant business organization (C) when A provides services for or on behalf of C (section 8). Regardless of the quality in which A provides services for or on behalf of C; A may be the employee, subsidiary or representative of C. . . . .