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Sales Agent Law Austria | General
Conclusion of the Contract - Competition - Commission - Termination of the Contractual Relationship - Minimum period of Notice for Termination
There are complex and detailed legal provisions for the distribution by sale agents (also referred to as commercial agents). The major part of the Austrian Commercial Agents Act of 1993 is binding. This means that these binding provisions cannot be evaded by contractual agreements or by applying the law of another state.
Sales Agent Law Austria | Conclusion of the Contract
An explicit formal agreement between the principal and the sales agent is not necessary. Business relations are already established if the principal engages the Austrian sales agent permanently for mediation or business transactions on a commission basis.
In this case the legal relationship between the principal and the Austrian sales agent is automatically subject to the Austrian Sales Agents Act, no matter whether the sales agent is a physical person or a legal entity.
Sales Agent Law Austria | Commission
In case the parties have not made any agreement on the agent’s commission, there are respective provisions in the Austrian Sales Agents Act to be applied. In such a case of doubt those particular provisions are usually not to the benefit of the principal but to the benefit of the sales agent.
The Act provides that in case of doubt the sales agent is entitled to charge a commission even if he has not been directly involved in the business relations of the exporter and his client. If the sales agent has been engaged as the sole representative for a certain area or a certain clientele, in case of doubt the Act entitles him to charge a commission even for business transactions between the principal and those clients he was not at all involved in.
So it is indeed recommendable to stipulate unambiguous provisions in writing.
Sales Agent Law Austria | Termination of the Contractual Relationship
Of course, the contractual relationship can be terminated by agreement at any time. Moreover, it can be terminated by expiry, notice of termination, cancelation for stringent reasons and because of bankruptcy of the principal.
Sales Agent Law Austria | Minimum period of Notice for Termination
The minimum periods of notice, which are provided by law and cannot be altered to the disadvantage of the sales agent, must strictly be regarded.
- In the first year the contract may be dissolved under observance of a one-month period of notice. The periods of notice increase with the duration of the contract.
- After the beginning of the second year there is a minimum period of notice of two months,
- after the beginning of the third year it is three months etc.
- After the beginning of the sixth year and in the following years the minimum period of notice is six months.
Earlier terminable contracts have to be regarded in the calculation of the period of notice. Unless there are any other explicit agreements, the notice can only take effect at the end of a calendar-month.
If the principal gives notice of termination of the contract without observing the periods of notice provided by law, he has to take into account claims for damages by the commercial agent. In this case the agent may claim the amount of money he would have received if the period of notice provided by law had been observed. In other words: he is entitled to charge damages for the missed commissions.
However, instead of claiming compesnation the sales agent shall also be entitled to claim performance of the contract.
Moreover, the sales agent is basically entitled to claim compensation.
Compensation | Prerequisites | Investment Replacement
Topics : Sales Agent | Commercial Agent Law |