The INTERNATIONAL SALES COMMISSION AGREEMENT regulates the relations between a person or a company, Agent, which manages the sales for a company, Principal, which supplies products and which wishes to move into international markets.

1. INTERNATIONAL SALES COMMISSION AGREEMENT
1. Definition
2. Parties to the Agreement
3. Main clauses and sample
3.1 Territory and exclusivity
3.2. Calculation of commission
3.3 Commission payment
3.4 Negotiation margin
3.5. Compensation
4. Law applicable
5. Model Agreement
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2. The International Sales Commission Agreement regulates
the relations between a person or a company (Agent) which
manages the sales for a company (Principal) which supplies
products and which wishes to move into international markets.
The Agent offers products to potential clients in an assigned
territory (usually a country), strictly in accordance with the sale
conditions indicated to it by the Principal.
The Agent’s remuneration is only through a commission which
is established as a percentage on the sales made and effectively
collected by the Principal.
1. DEFINITION
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3. The Principal is always a company but the Agent can be a company
or a person (independent professional). For each party, the following
has to be included:
• Name of company, full address and nationality.
• Company type: public limited company, limited liability
company, etc.
• Name and position of company representative who signs the
agreement.
• Name, profession, full address and nationality of person who
acts as Representative.
• Tax ID number of both parties.
2. PARTIES TO THE AGREEMENT
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4. Some of the most important clauses in the International
Sales Commission Agreement are as follows:
• Territory and exclusivity.
• Calculation of commission.
• Commission payment.
• Negotiation margin.
• Compensation.
3. MAIN CLAUSES AND SAMPLE
See sample International Sales Commission Agreement
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5. “The territory assigned by the Principal to the Agent for the promotion
and sale of the products is ........................ [insert territory: country or
countries, regions, etc.].”
“The Principal exclusively grants the Agent the right to promote and
sell the products in the assigned territory. The Agent shall be entitled
to receive the commission stipulated in clause 3 of this Agreement for
all the sales it carries out in the assigned territory during the period
this Agreement is in force.”
3.1 TERRITORY AND EXCLUSIVITY
See sample International Sales Commission Agreement

6. 3.2 CALCULATION OF COMMISSION
“The Principal agrees to pay the Agent, in exchange for the services
rendered, a commission of ...... % [insert commission, usually between
5% and 10% of the value of sales carried out]. The commission
percentage established in this clause cannot be modified by the Parties,
unless it is mutually agreed in writing.”
“The amount of the commission will be calculated on the net value
of sales, in other words, the price in invoices of products sold by the
Agent, without including additional expenses (packaging, transport and
insurance), or taxes, provided that the aforesaid expenses and taxes are
indicated separately in the invoice.”
See sample International Sales Commission Agreement

7. 3.3 COMMISSION PAYMENT
“The commission will always be paid upon the previous payment by
the clients to the Principal for the amount of the sales.
Alternative A. “The commissions shall be settled, on a transaction by
transaction basis, and shall be paid within a period of ......... [10, 20,
30, 60] calendar days counting from the date of the client’s payment to
the Principal.”
Alternative B. “The commissions shall be settled in groups and shall
be paid ............. [monthly, quarterly, annually] on the last day of the
corresponding period.”
See sample International Sales Commission Agreement

8. 3.4 NEGOTIATION MARGIN
“In negotiations with clients, the Agent will have a negotiating margin
of .......% [3, 5, 10, 20] on the prices of the products established by the
Principal. Accordingly, the Agent can propose discounts within these
margins to its clients, without the prior authorization of the Principal,
without reducing its commission.”
See sample International Sales Commission Agreement

9. 3.5 COMPENSATION
“TheAgentshallnotbeentitledtocompensationforgoodwillintheevent
of cancellation of the Agreement, although it shall be entitled to claim for
damages,if thecancellationbythePrincipalentailsabreachof agreement
and is not set forth in this Agreement.”
“For the purposes of compensation for cancellation of agreement, laws
concerning Agency or Sales Representative Agreements shall not be
applicable to this Agreement.”
See sample International Sales Commission Agreement

10. International Law standards are not applied to this type
of Agreement.
The parties are free to submit any conflicts regarding the
agreement to International Arbitration or to the Laws of
the country of one of the parties. They will normally be
subject to the Laws of the country of the Principal.
4. Applicable Law
See sample International Sales Commission Agreement

11. In order to obtain the model contract in Word
format and the user guide, click on:
International Sales Commission Agreement
5. MODEL CONTRACT
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