International Commercial Agency Contract for Philippines

International Commercial Agency Contract Template for Philippines

A comprehensive legal agreement governed by Philippine law that establishes and regulates the relationship between a foreign principal and a Philippine-based commercial agent. This contract defines the terms under which the agent will represent the principal in the specified territory, including commission structures, performance requirements, and compliance with local regulations. The document incorporates specific provisions required under Philippine civil and commercial law, while addressing international trade considerations and protecting both parties' interests in cross-border commercial activities.

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What is a International Commercial Agency Contract?

The International Commercial Agency Contract is essential for businesses seeking to establish a commercial presence in the Philippines through local representation. This document is particularly relevant when foreign companies wish to enter the Philippine market without establishing a direct subsidiary or branch office. The contract must comply with Philippine Civil Code provisions on agency (Articles 1868-1932), the Code of Commerce, and relevant international trade regulations. It typically includes detailed provisions on territory rights, commission structures, performance metrics, and compliance requirements. The agreement also addresses specific Philippine law requirements regarding foreign investment restrictions, anti-dummy laws, and local business regulations. This document is crucial for protecting both the principal's and agent's interests while ensuring compliance with both Philippine and relevant international legal frameworks.

What sections should be included in a International Commercial Agency Contract?

1. Parties: Identification of the Principal and Agent, including full legal names, addresses, and registration details

2. Background: Context of the agreement, nature of the Principal's business, and purpose of the agency relationship

3. Definitions: Key terms used throughout the agreement, including Territory, Products/Services, Commission, etc.

4. Appointment and Scope: Terms of agent appointment, exclusivity status, and territorial scope

5. Duration: Term of the agreement, including commencement date and initial period

6. Agent's Rights and Obligations: Detailed responsibilities, performance standards, and authorized activities

7. Principal's Rights and Obligations: Support to be provided, information sharing, and principal's commitments

8. Commission Structure: Calculation method, payment terms, and conditions for commission

9. Intellectual Property: Usage rights for trademarks, trade names, and other IP

10. Confidentiality: Protection of confidential information and trade secrets

11. Non-Competition: Restrictions during and after the agreement term

12. Termination: Grounds for termination, notice requirements, and consequences

13. Post-Termination: Obligations and rights after agreement ends

14. Governing Law and Jurisdiction: Philippine law application and dispute resolution mechanisms

15. General Provisions: Standard clauses including force majeure, notices, and amendments

What sections are optional to include in a International Commercial Agency Contract?

1. Minimum Performance Requirements: Include when specific sales targets or performance metrics are required

2. Sub-Agents: Include when the agent may be permitted to appoint sub-agents

3. Marketing and Promotion: Include when specific marketing obligations are required of the agent

4. Training and Support: Include when extensive training or support will be provided

5. Insurance: Include when specific insurance coverage is required

6. Data Protection: Include when personal data processing is involved

7. Anti-Corruption: Include for high-risk territories or when required by principal's policies

8. Import/Export Compliance: Include when international movement of goods is involved

9. Product Liability: Include when dealing with physical products

10. Bank Guarantee: Include when financial security is required from the agent

What schedules should be included in a International Commercial Agency Contract?

1. Schedule 1 - Territory Definition: Detailed description of geographical areas covered

2. Schedule 2 - Products/Services: Comprehensive list of products or services covered by the agreement

3. Schedule 3 - Commission Structure: Detailed commission calculations, rates, and examples

4. Schedule 4 - Performance Targets: Specific sales targets and performance metrics

5. Schedule 5 - Trademark Usage Guidelines: Rules for using principal's trademarks and branding

6. Schedule 6 - Reporting Requirements: Templates and timing for required reports

7. Appendix A - Standard Operating Procedures: Detailed procedures for day-to-day operations

8. Appendix B - Compliance Requirements: Specific regulatory and compliance obligations

9. Appendix C - Required Forms: Standard forms for orders, reports, and other documentation

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Philippines

Publisher

Genie AI

Document Type

Agency Agreement

Cost

Free to use
Relevant legal definitions
Clauses
Relevant Industries

Manufacturing

Consumer Goods

Industrial Equipment

Technology and Software

Pharmaceuticals

Automotive

Electronics

Textiles and Apparel

Agricultural Products

Construction Materials

Chemical Products

Medical Devices

Telecommunications

Professional Services

Retail and Distribution

Relevant Teams

Legal

Commercial Operations

International Business Development

Sales

Compliance

Finance

Risk Management

Corporate Affairs

Business Development

Contract Administration

Relevant Roles

Chief Executive Officer

Commercial Director

International Business Development Manager

Sales Director

Legal Counsel

Compliance Officer

Contract Manager

Business Development Executive

Export Manager

Country Manager

Regional Sales Manager

Commercial Operations Manager

General Counsel

Chief Financial Officer

Risk Manager

Industries
Civil Code of the Philippines (Republic Act No. 386): Contains fundamental provisions on agency relationships (Articles 1868-1932), contract formation, obligations and contracts, and general principles of civil law applicable to commercial relationships
Code of Commerce of the Philippines: Governs commercial transactions and provides specific regulations for commercial agencies and mercantile contracts
Foreign Investments Act of 1991 (Republic Act No. 7042): Regulates foreign investments and business activities in the Philippines, including requirements and restrictions for foreign entities
Omnibus Investments Code (Executive Order No. 226): Provides guidelines and incentives for investments in the Philippines, affecting international commercial relationships
Philippine Competition Act (Republic Act No. 10667): Ensures fair competition and regulates anti-competitive practices, including exclusive agency arrangements
Consumer Act of the Philippines (Republic Act No. 7394): Protects consumer interests and may affect agency relationships involving consumer products or services
Anti-Dummy Law (Commonwealth Act No. 108): Prohibits the circumvention of nationalization laws through dummy arrangements, relevant for international agency relationships
Intellectual Property Code (Republic Act No. 8293): Governs intellectual property rights protection, important for agency agreements involving trademarked or patented products
Electronic Commerce Act (Republic Act No. 8792): Regulates electronic transactions and may be relevant for modern commercial agency arrangements conducted electronically
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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