A distribution agreement is a continuing contract in which a supplier sells goods to an independent distributor, who resells them in its own name, for its own account and at its own risk. Dutch law has no specific statutory regime for it: unlike commercial agency and franchise, distribution is governed by general contract law, by what the parties agree and by competition law, although Dutch courts do require a reasonable notice period on termination.
Because the law leaves so much open, the contract has to settle almost everything that may later be disputed. Below we explain how distribution differs from related models, which clauses matter, where competition law draws the line and what ending the relationship involves.
What is a distribution agreement, and what is it not?
The defining feature is ownership: the distributor buys the goods, holds its own stock and earns a margin on resale. It is not paid commission and does not conclude contracts on behalf of the supplier, so it carries the credit risk on its own customers.
The label matters, because neighbouring contract types carry mandatory rules. A trgovačka agencija falls under Articles 7:428 to 7:445 of the Dutch Civil Code (BW), with mandatory notice periods and a goodwill indemnity. Franchise has been regulated since 1 January 2021 in Articles 7:911 and following BW, which require the franchisor to provide information at least four weeks before signing (Article 7:914 BW). If a so-called distributor in fact carries no commercial risk, a court can treat the relationship as agency and apply the agency rules.
| Model | Posjeduje pravo vlasništva nad robom | zarađuje | Rules in the Netherlands |
|---|---|---|---|
| Distribucija | Da | Marža preprodaje | General contract law (Book 6 BW) and competition law |
| Komercijalna agencija | Ne | Provizija | Articles 7:428-7:445 BW, largely mandatory |
| pravo glasa | Obično da | Own margin, pays a fee | Articles 7:911 and following BW |
| Licence | Nema uključene robe | kraljevstvo | Intellectual property and contract law |
For the last model, see our note on ugovor o licenci.
Which form of distribution should you choose?
The choice determines who may sell where, and how hard it will be to end the relationship. Each model also has its own position under the EU Vertical Block Exemption Regulation, Regulation (EU) 2022/720.
- Ekskluzivna distribucija: one distributor per territory or customer group, and the supplier does not supply anyone else there, including itself.
- Sole distribution: no second distributor, but the supplier keeps the right to sell directly, usually to named key accounts. List those accounts one by one.
- Non-exclusive distribution: several distributors side by side, suitable for standard goods but prone to channel conflict.
- Selektivna distribucija: any dealer meeting objective, qualitative criteria may be appointed, typical for luxury, automotive and technical products.
If a master distributor may appoint sub-distributors, the agreement should state who approves them, which obligations pass down, what reporting applies and whether the master distributor is liable for them. Without that, the supplier loses sight of who sells its products, which is where grey-market complaints often start.
Which law applies, and what can you not contract away?
Between parties in different EU countries, the Rome I Regulation decides which law applies. Without a choice of law, a distribution contract is governed by the law of the country where the distributor has its habitual residence, so a Dutch supplier should choose Dutch law expressly and add a separate forum or arbitration clause.
The individual sales under the framework agreement are sales contracts. Between parties in countries that have ratified the Vienna Sales Convention (CISG), that convention applies automatically unless it is excluded; it has its own rules on conformity, notice of defects and remedies, so decide deliberately whether to keep it.
Under Article 6:248 BW, every contract is also read in light of reasonableness and fairness (redelijkheid en billijkheid), and a clause does not apply where relying on it would be unacceptable by that standard. Dutch courts interpret contracts by what the parties could reasonably expect from each other, not only by the words used, so state which document prevails if annexes or price lists contradict the framework agreement.
Koje klauzule određuju ishod?
A distribution agreement should read like an operating manual. Most disputes concern territory, targets, prices and exit, and each can be settled in advance.
Territory, products and online sales
Define the territory and customer groups by reference to something verifiable, such as a list of countries or postal codes in an annex, not a vague term like “Benelux”. Put the product range in an annex with a procedure for adding and withdrawing products. Say expressly what the distributor may do online, as silence on e-commerce is the most common source of channel conflict.
Targets and exclusivity
Link exclusivity to a minimum purchase or turnover target and state what happens if it is missed: conversion to non-exclusivity, appointment of a second distributor, or termination. Specify the reference period over which performance is measured, for example each calendar year.
Prices, payment and delivery
The supplier may recommend resale prices and set maximum prices, but may not fix minimum or fixed resale prices, as that is a hardcore restriction under Regulation (EU) 2022/720. Agree payment terms, late-payment interest and, for foreign currency, an exchange-rate mechanism. Choose an Incoterm, name the version (for example Incoterms 2020) and make sure the contract allocates transport, insurance and customs in the same way.
Brand use, data and liability
Brand use requires a licence that is non-exclusive, revocable and limited to the products and territory, with approval rights over packaging, advertising and domain names. Where customer data moves between the parties, determine whether each is an independent controller or one processes on behalf of the other, and make notification periods workable against the GDPR deadline for reporting data breaches.
For liability, decide on the cap, the exclusions and the carve-outs. A cap linked to the amount invoiced over a recent period is common in Dutch practice, but liability for intent and deliberate recklessness cannot be excluded. Require product liability insurance and ask for the certificate. Our note on B2B purchase conditions explains how general terms interact with a framework agreement.
sporovi
Dutch courts are relatively fast and inexpensive; arbitration is private and easier to enforce outside the EU. A short escalation clause requiring the parties to meet before starting proceedings costs nothing and often leads to a sporazum o nagodbi.
Što dopušta pravo tržišnog natjecanja?
A distribution agreement is a vertical agreement under Article 101 of the Treaty on the Functioning of the European Union (TFEU) and, for effects on the Dutch market, Article 6 of the Dutch Competition Act (Mededingingswet). Regulation (EU) 2022/720, which applies from 1 June 2022 until 31 May 2034, exempts the agreement if neither party has a market share above 30% and it contains no hardcore restriction.
The main hardcore restrictions are fixing minimum or fixed resale prices, restricting the territory or customers to which the distributor may sell beyond the limited exceptions for exclusive and selective systems, and preventing effective use of the internet for sales. The regulation does allow different wholesale prices for online and offline sales and different criteria for online and offline outlets in a selective system, as long as effective online selling is not prevented. Non-compete obligations on the distributor are only exempt for a limited period, and after the contract only within narrow limits.
Under Article 6(2) of the Competition Act, prohibited agreements are void by operation of law, and the other party can invoke that nullity in any dispute. The Netherlands Authority for Consumers and Markets (ACM) and the European Commission enforce these rules and can impose fines. Selective distribution remains lawful if the criteria are qualitative, uniform and applied without discrimination, so keep a written record of the criteria and of every refusal.
How do you end a distribution agreement?
Dutch law sets no statutory notice period for distribution, but a distribution agreement for an indefinite period can generally only be terminated with a reasonable notice period. What is reasonable depends on the length of the relationship, the distributor’s investments and its dependence on the supplier; in some cases, the requirements of reasonableness and fairness also call for compensation.
A goodwill indemnity is a different matter. The statutory customer indemnity of Article 7:442 BW applies to commercial agents, not to distributors, who buy and resell at their own risk. Compensation on termination is only possible through reasonableness and fairness, and remains the exception.
The real exposure therefore lies in the notice period, so agree it in the contract. Also arrange the exit: whether the supplier buys back saleable stock and at what price, what happens to demonstration material and spare parts, how long the distributor may service existing customers, when brand use stops and what happens to the customer list. List the grounds for immediate termination, such as insolvency, change of control or serious breach, rather than relying on a general reference to breach.
What about VAT, customs and product liability?
Goods supplied from the Netherlands to a business in another EU country are generally an intra-Community supply at 0% VAT, provided the buyer’s VAT number is valid and transport can be proven. The contract should oblige the distributor to provide its VAT number, report changes and cooperate on proof of transport. The tax treatment itself is a matter for your tax adviser; we advise on the allocation of these duties in the contract.
For goods from outside the EU, state who acts as importer, who bears customs duties and anti-dumping levies, and who screens customers against sanctions lists. A distributor selling into a sanctioned destination also creates exposure for the supplier.
Under Article 6:185 BW, the producer is liable for damage caused by a defective product. Under Article 6:187(3) BW, anyone who imports a product into the European Economic Area for commercial distribution is treated as a producer. A distributor importing from outside the EEA therefore bears producer liability even though it made nothing, which the insurance clause and indemnity in the contract should address. Agree who holds the technical documentation, such as CE files, and who leads a recall.
Where do templates fail?
A template is a starting point, not a contract. Foreign templates often contain resale price or territorial restrictions that are hardcore under Regulation (EU) 2022/720, assume a statutory notice regime that Dutch law does not have, or contain delivery terms that contradict the chosen Incoterm.
Templates also miss sector rules: vigilance and device identification for medical devices, traceability and shelf life for food, update obligations and encryption export controls for software and connected products, and selective criteria for luxury goods. The cross-border pitfalls are set out in our article on međunarodni trgovački ugovori.
Što biste trebali provjeriti kao dobavljač?
- Check that the contract contains no minimum or fixed resale prices and no ban on online sales.
- Check your market share against the 30% threshold of Regulation (EU) 2022/720.
- Agree a notice period in the contract, linked to the duration of the relationship.
- Reserve named key accounts if you want to keep selling directly in a sole distribution model.
- Arrange a stock buy-back and the end of brand use on exit.
What should you check as a distributor?
- Check whether your exclusivity depends on targets and what happens if you miss them.
- Check that the notice period reflects the investments you will make in the territory.
- Check who buys back your stock on termination and at what price.
- Check whether you import from outside the EEA and are therefore treated as a producer under Article 6:187(3) BW.
- Check the liability cap and the insurance you must take out.
What can we do for you with distribution agreements?
Naši odvjetnici za ugovore i korporativni pravnici act for suppliers and distributors entering the Dutch and European market.
- We draft or review your distribution agreement, including territory, targets and exit clauses.
- We check the agreement against Article 101 TFEU, Article 6 of the Competition Act and Regulation (EU) 2022/720.
- We assess whether a relationship is distribution, agency or franchise and what follows from that.
- We calculate a reasonable notice period and draft the termination letter.
- We negotiate the exit or conduct proceedings about territory, targets or termination.
Where you will have staff in the Netherlands, see our note on the Nizozemski ugovor o radu.
Rezime
- Distribution has no statutory regime in Dutch law; the contract, general contract law and competition law apply.
- Agency (Articles 7:428 BW and following) and franchise (Articles 7:911 BW and following) have mandatory rules; the label must match reality.
- Regulation (EU) 2022/720 exempts agreements below 30% market share without hardcore restrictions such as resale price maintenance.
- Termination requires a reasonable notice period; there is no statutory goodwill indemnity for distributors.
- An importer into the EEA is treated as a producer for product liability under Article 6:187(3) BW.
Često postavljana pitanja
Is a distributor entitled to a goodwill indemnity in the Netherlands?
Not under statute. The customer indemnity of Article 7:442 BW applies to commercial agents. A distributor can only claim compensation on termination through the general standard of reasonableness and fairness, which is the exception.
What notice period applies to a distribution agreement?
Dutch law sets no fixed period. Without a contractual period, a distribution agreement for an indefinite period requires reasonable notice, depending on the duration of the relationship, the investments made and the distributor’s dependence. Agreeing the period in the contract avoids this uncertainty.
May a supplier set the resale price?
Only as a recommendation or a maximum. Fixing minimum or fixed resale prices is a hardcore restriction under Regulation (EU) 2022/720 and makes the restriction void under Article 101 TFEU and Article 6 of the Dutch Competition Act.
Which law applies to a cross-border distribution agreement?
The law the parties choose. Without a choice, the Rome I Regulation points to the law of the country where the distributor has its habitual residence. The CISG may apply to the individual sales unless the parties exclude it.