The indemnity upon termination of an agency agreement: what is the agent entitled to (under Dutch law)?
Is a commercial agent always entitled to a goodwill indemnity upon termination of an agency agreement? And is that indemnity automatically equivalent to one year’s commission? These are common assumptions, but under Dutch law the legal position is more nuanced. Whether an agent is entitled to an indemnity, and the amount payable, depends on a range of circumstances.
Stefan van der Horst, attorney at MannaertsAppels Advocaten who specialises in, among other areas, commercial agency law, has written a whitepaper on this subject for businesses that engage commercial agents, as well as agents themselves.
In this whitepaper, you will learn:
- When a commercial agent is entitled to an indemnity upon termination of an agency agreement.
- What conditions must be satisfied and which exceptions apply.
- How the amount of the indemnity is calculated in three stages.
- How commission, the customer base and contractual arrangements affect the indemnity.
- How clear contractual provisions can help prevent disputes following termination.
After reading this whitepaper, you will:
- Understand when an indemnity may be payable and when it is not.
- Have a clearer understanding of the factors that determine the amount of the indemnity.
- Be better equipped to assess the potential financial consequences of terminating an agency agreement.
- Know which matters require particular attention when drafting an agency agreement to minimise the risk of disputes both during the agreement and following its termination.
Would you like to know what you should take into account as a principal or commercial agent? Download the whitepaper.
If you have any questions about your rights or obligations when entering into, or terminating, an agency agreement, please feel free to contact Stefan van der Horst. He advises and represents both commercial agents and principals, whether in drafting agency agreements or in disputes concerning their termination and any potential indemnity. He would be pleased to assist you.