Puerto Rico Form - Large Quantity Sales Distribution Agreement
Description
How to fill out Form - Large Quantity Sales Distribution Agreement?
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FAQ
A distribution agreement is one under which a supplier or manufacturer of goods agrees that an independent third party will market and sell the goods. The distributor buys the goods on their own account and trades under their own name.
Many distribution agreements contain a clause providing what the distributor gets paid for selling the product, as well as a commission based on the number of products it sells. Commissions give the distributor the added incentive of selling as much of the supplier's product as possible.
Many multinational corporations have extended their operations to Puerto Rico by appointing local distributors. Consequently, Law 75 enacted on June 24, 1964 aggressively protects local distributors from distribution agreement termination without just cause.
Puerto Rico's Act 75 of June 24, 1964 was enacted to protect Puerto Rican distributors or dealers from arbitrary terminations to a distribution agreement.
What are the key elements of a distribution agreement? There are a number of key issues that need to be included in a distribution agreement including exclusivity, term, the product(s), price, delivery, and the relevant territory.
The Distributor Agreement should clearly set forth the duties, responsibilities and expectations of each of the parties. The Distributor Agreement should also set forth provisions related to limitations and protections that each party can understand.
In brief, a comprehensive distribution agreement should address the key matters regarding the relationship between the supplier and the distributor. Key among these matters are the type of appointment, territory and the price and payment terms among other things.
The Distributor Agreement should clearly set forth the duties, responsibilities and expectations of each of the parties. The Distributor Agreement should also set forth provisions related to limitations and protections that each party can understand.