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Distribution Agreements in Hong Kong

Distribution Agreements in Hong Kong

Updated on Tuesday 31st May 2016

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Distribution-Agreements-in-Hong-Kong.jpgA distribution agreement in Hong Kong is signed between two partners, one that acts as the manufacturer and one that acts as the distributor of the manufactured goods. When the distribution chain is more complex, this type of agreement can be signed between two different distributors.
The distribution agreement will set forth the responsibilities of the two parties as well as the terms for the distribution which can, in some cases, be selective or exclusive.
Our lawyers in Hong Kong can help you draw up this document and manage existing relations with distributors or manufacturers.

Information included in a Hong Kong distribution agreement

The distribution agreement contains the terms of the relationship between the manufacturer/supplier and the distributor. One manufacturer may have an exclusive distributor or more and distributors may sign subsequent distribution agreements among themselves.
Some of the information that is typically included in a distribution agreement signed by a company in Hong Kong is:
- the name of the distributor and the supplier,
- the date of the document,
- appointment terms by the supplier,
- the shipment of the products and usage of trademarks,
- the delivery price negotiated between the parties,
- the prices used by the distributor for the customers,
- the supplier’s guarantee that the products are quality items, properly manufactured and stored,
- termination rights.
The rules and laws of the state in which it is drawn up generally govern a distribution agreement. International distribution agreements may be subject to different legal terms. Our team of lawyers in Hong Kong can help you settle disagreements or claims through litigation or arbitration. 

Distribution agreements and the competition law in Hong Kong

Selective distribution agreements may be signed in certain business fields. The manufacturer can thus ensure the control of the sale process as well as the quality of the services provided to the customers. This practice may conflict with the Hong Kong Competition Law if it harms the existing competition. If a selective distribution process prohibits the entry of more retailers then it will conflict with the competition law.
Business owners in Hong Kong who want to apply a selective distribution criteria can base their selection on qualitative issues and not use this criteria for discriminatory distributor selection.
For more information about the competition or the contract law please contact our Hong Kong law firm.


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