Commercial Agents Update 2010 (Part 3)

by Christopher Tayton Clarkslegal LLP

What happens if your
agency agreement is
subject to the law of a
country outside the
EU?

Often you will see Agency
Agreements providing that the
law of a country outside the EU,
such as the US or Canada, governs
the terms of the agreement.
Sometimes, the agreement will
provide that disputes should be
referred to arbitration, again
outside the EU.
S i n c e t h e C o m m e r c i a l A g e n t s
Regulations are the product of EU
legislation, it is unlikely that the Courts in
a country outside the EU will recognise a
claim for compensation or an indemnity
under the Regulations. However,
provided that you qualify as a
commercial agent under the definition
in the Regulations, the fact that your
agreement is subject to the law of a
non-EU country does not mean you
lose your legal remedies.
Certain parts of the Regulations,
including compensation / indemnity
under Regulation 17 cannot be
excluded by the parties. Even though
your contract may be governed by US
Law, you would still be entitled to bring a
claim in the English Courts for
compensation or an indemnity
provided you were recognised as a
c o m m e r c i a l a g e n t u n d e r t h e
Regulations.
This is the point the Court was required
to consider in Accentuate Ltd v Asigra
2009. The agency agreement was
subject to Canadian law with disputes to
be determined by an arbitration held in
Canada. When the agent gave notice of
their claim for compensation, the
principal immediately served notice
requiring an arbitration to be convened
in Canada and not surprisingly the
Canadian arbitrator held there was no
valid claim for compensation because
Canada does not recognise the
Commercial Agents Regulations.
This was despite the principal arguing
that the agent did not qualify as a
commercial agent. The agent was
entitled to have his claim, including the
question of whether he was, in fact, a
commercial agent determined in the
English Courts despite the existence of a
Canadian arbitration clause.
The English Court held that the
m a n d a t o r y p r o v i s i o n s o f t h e
Regulations, in particular Regulation 17,
could not be excluded by the parties,
and therefore the commercial agent
remained entitled to sue the principal in
the English Courts.

Chris is a dispute resolution lawyer working out of
the firm’s Reading and London offices.
Chris has particular expertise in the Commercial
Agents Regulations (acting for both principals
and agents), advertising law and restrictive
covenants in employment contracts.
He also advises on IT and software related claim,
and is a member of the Society for Computers
and Law.

Head Office:
Thames Valley Office: One Forbury Square,
The Forbury, Reading RG1 3EB
Tel: 0118 9604691
www.clarkslegal.com

Disclaimer: This column does not contain legal advice and is for general
guidance only. Agentbase, Clarkslegal LLP and the writer accept no
liability in connection with the general guidance given in this column.

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