Term and Termination of the Agreement

A distribution agreement can be agreed to be valid for a specified period, in which case it will terminate upon expiry of the term. The agreement can also remain in force until further notice, in which case the notice period and grounds for termination should be agreed upon. In addition, grounds for rescission of the agreement can also be agreed upon.

In certain situations, it is advisable for the parties to already during agreement negotiations agree upon the treatment of the distributor’s stock of products following termination of the agreement.

Unlike agents, a distributor usually is not entitled to indemnification or other compensation upon termination of the agreement.