10/05/2018 - RIGHT OF THE COMMERCIAL AGENT TO AN INDEMNITY OR COMPENSATION FOR DAMAGE FOLLOWING TERMINATION OF THE COMMERCIAL AGENCY CONTRACT DURING THE TRIAL PERIOD

According to the European Court of Justice (ECJ), the right to indemnity and to compensation for damage, provided for by article 17 of Directive 86/653 to commercial agents, is applicable even if the termination of the contractual relationship between the principal and the commercial agent occurs during the trial period (April 19, 2018 (C-645/16)).

The interpretation that no indemnity is payable in the event of termination of the commercial agency contract during the trial period is incompatible with the mandatory nature of the regime established by Article 17 of Directive 86/653 and detrimental to the commercial agent, who is denied any redress on the sole ground that the contract he or she has with the principal includes a trial period. The ECJ has observed that one of the main purposes of Directive 86/653 is to protect the commercial agent in his or her relations with the principal. In that regard, the ECJ has held that Articles 17 and 18 of the mentioned Directive are of crucial importance, as they define the level of protection which the European Union legislature considered reasonable to grant commercial agents in the course of the creation of the single market. The regime established by Directive 86/653 for that purpose is mandatory in nature.

The question referred to the ECJ by the French Cour de Cassation for a preliminary ruling on the interpretation of article 17 of the mentioned Directive involved a commercial agency contract concerning the sale of individual houses. The agent asked, first, for the payment of compensation for the loss arising from the termination of the commercial agency contract and, second, damages for the wrongful termination of the contract during the trial period.

 

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