1) The agency has been subject to the influence of the EU 653/86 Directive. Hence, it contemplates agency with fixed term (freely discussed between the parties) and agency without any term (undetermined) subject to unilateral discontinuance with prior notice by any party.
2) The agent is defined, according to the traditional parameters, as an independent person that professionally and permanently accepts to promote the business or products of the manufacturer and eventually conclude, when authorized, the business offered to third parties .
3) The agent may also be appointed by any other person to act as such, provided that such person is not a competitor of the manufacturer or a competitor of the product. In both cases it must obtain the authorization of the manufacturer.
4) Rights and obligation of both parties are carefully defined following standard European patterns. Both have to act in good faith, and confidentiality of information is a duty of agent. Expediency in answering offers and communicate any delay is an obligation of manufacturer, among others.
5) In case of a contract of fixed term on termination without renewal, there is not need to give any anticipated notice and hence the lack of notice does not entail the right to indemnify, even if the contract has lasted for 5 years. However, the agent is entitled to the special indemnity for “clientelle” in case that it has significantly developed the market of the manufacturer in the territory. In the absence of agreement, the amount of the indemnity shall be determined by the judge and it cannot exceed of a year of sales performed by the agent net of costs and expenses.
6) In case that such contract is renewed for any term, it becomes automatically, by operation of law, a contract of undetermined term and a prior notice of unilateral termination shall be given in accordance with the period that the agreement has been into effect. Failure to make the prior notice entails a one month of profits for each year that the contract has been into effect, without any ceiling (e.g. 20 years, 20 months).
7) The comission, normally the standard remuneration of an agent, is not earned by signing or concluding the agreement but it is accrued only if payment to manufacturer has been made after conclusion or acceptance of the offer. This is a deviation of many European practices but reflects Argentinian usages.
8) ”Del credere” commission is limited to the amount of the premium paid to the agent.
9) The law contemplates a limited indemnity of two months when the agent has failed to perform its agreed sale targets during two consecutive years.
10) The contract ends also for the death, bankruptcy, or for a valid cause in case of its unfulfillment or when the agent is too old or unable to perform its duties.
Osvaldo Marzorati, IDI country expert for Argentina