Introduction

International agency agreements are legal arrangements that allow a manufacturer or seller to operate in a specific geographical region through an independent representative. In European markets such as Germany, the Netherlands, Switzerland, and Austria, these agreements are evaluated under both Turkish law and European Union law. Proper regulation of the rights and obligations between the parties and compliance with the relevant legislation are essential for the validity of the agreement and the protection of the parties’ interests.

Terminology and Synonymous Expressions

In Turkish law and practice, various terms are used for agreements that authorize a person to conduct commercial transactions in a specific region on behalf of or for the account of a business. The Turkish Commercial Code defines an agent as a person who, “without having a legal status such as a commercial agent, proxy, sales employee, or company staff member, based on a contract, permanently mediates or concludes agreements concerning a commercial enterprise in a specific place or region on behalf of the merchant.”

Therefore, different terms may be used to describe the same legal relationship:

• Agency agreement and agency contract are the two most common expressions and define the same legal relationship.

• Commercial representation agreement or commercial agency contract can be used as synonymous terms, referring to the concepts of “commercial representative” and “commercial proxy” mentioned in the legal definition of the agent.

• For more general usage, the terms representation agreement or intermediation agreement may also be preferred.

Although these terms differ, they all describe the same legal relationship in which an independent representative conducts commercial activities on behalf of a business. Within this article, these concepts will be used interchangeably.

Why Is Professional Legal Support Important?

When drafting an international agency agreement, the guidance of expert lawyers ensures that the contract complies with the legal framework and that the parties are represented fairly. Lawyers:

• Provide expert assessment: They identify legal risks in the drafting and negotiation processes and develop recommendations in compliance with the law.

• Manage risks: They clarify the parties’ obligations and contract provisions, reducing the risk of non-compliance and disputes.

• Ensure negotiation balance: They safeguard the legal framework during discussions and contribute to establishing fair conditions between the parties.

• Ensure legal compliance: They establish consistency between EU law and national legal systems and determine the applicable law correctly.

• Prevent disputes: They ensure that the provisions of the agreement are clear and enforceable, thereby avoiding potential future conflicts.

The EU Commercial Agents Directive and Agency Rights

The European Union’s Directive 86/653/EEC was adopted to provide minimum protection for independent commercial agents. The Directive sets out mandatory rules that cannot be altered by the parties, particularly regarding remuneration, termination notice, and post-termination compensation.

For example:

• An agent is entitled to compensation or an indemnity if they have brought new customers to the principal or increased the business volume of existing customers. The amount of this payment must be determined “fairly,” taking into account the benefits derived from the relationship and the duration of service.

• Even in the event of termination, payments to the agent must continue, and contractual provisions waiving these rights or providing for the application of another law are invalid.

The German Commercial Code (HGB) and the EU Directive both require that agents’ commission rights be protected even after termination. Therefore, claims that these rights are not explicitly regulated in an agreement or end with termination lack legal basis.

Practical Considerations

Drafting the Agreement
When drafting an agency agreement, EU legislation and national law must be taken into account. The relationship between the parties, termination conditions, commission rates, and delivery terms should be clearly defined. The applicable law and competent court must also be explicitly stated. In addition, for contracts drafted in multiple languages, professional translation should be used to ensure accurate terminology.

Negotiations and Meetings
During contract negotiations, the equality of the parties should be preserved, and demands and claims must be subject to legal review. Issues such as commission rates, new business plans, corporate identity, and contract update periods should be evaluated based on objective criteria. Meeting minutes should be taken, and statements recorded, as these may serve as evidence in future disputes.

Language and Communication
In international contract negotiations, it is of great importance that the parties can communicate in their native language, as this ensures a correct understanding of their intentions and demands. Explanations given in the native language more clearly reveal the counterparty’s intentions and expectations. The use of professional translation and interpretation services helps prevent misunderstandings both during negotiations and in the drafting of contract texts, ensuring that the parties’ true intentions are properly reflected.

Contract Updates and Revisions
When revising an existing contract or drafting a new one, care must be taken to preserve the existing rights of the parties. Requests to change the applicable law or the competent court should be carefully assessed, as they may prolong the process and increase the risk of loss of rights for the parties.

Conclusion

The drafting and implementation of international agency agreements require comprehensive legal work. The EU Commercial Agents Directive and relevant national legislation stipulate that an agent’s rights to compensation and commission must be protected even after termination, and that these rights cannot be excluded by contract. Careful handling of contract preparation, negotiation processes, translation, and documentation is crucial for correctly determining the parties’ rights and obligations and minimizing the risk of disputes. Therefore, acting under the guidance of experienced lawyers in international agency relationships is indispensable for ensuring legal security.