Part 1 - Derogation from the Act
The Act may be derogated from by agreement unless otherwise stipulated in the Act. The rules in Part 3 may further be derogated from by custom.
(2) The rules in articles 22 and 25-27 may not be derogated from if that is to the detriment of the commercial agent through a choice-of-law agreement if the legal relationship would otherwise be governed by this Act.
(3) Where Danish law applies, that is, in circumstances where the commercial agent's duties for the principal under the contract are not to be discharged in a Member State of the EEC or EFTA, or in one of the Nordic countries, the parties may derogate from all the provisions of this Act. However, articles 22 and 25-27 may not be derogated from if indispensable provisions exist concerning termination and compensation in agency relationships in the country where the commercial agent is to discharge his duties or where the commercial agent is domiciled.
Part 2 - Commercial agents
In this Act, commercial agent shall mean a person who has agreed with another (“the principal”), on behalf of the latter independently, continuously and after careful consideration, to engage in the sale or purchase of goods by obtaining offers (orders) to the principal or by concluding agreements in the name of the principal.
The principal and the commercial agent are entitled to receive from the other party a signed document setting forth the terms of the agency agreement, including any subsequently agreed terms.
(2) Paragraph (1) may not be derogated from through an agreement.
In discharging his duties, the commercial agent shall safeguard the principal's interests, as well as act loyally and honestly.
(2) It is especially incumbent upon the agent to
- make reasonable efforts to obtain offers and, if so authorised, to conclude agreements on matters that are covered by the agency agreement;
- inform the principal about offers obtained or agreements concluded as well as about other circumstances known by the agent and which the principal ought to be aware of; and
- follow reasonable instructions given by the principal.
(3) Paragraphs (1)-(2) may not be derogated from by agreement.
The principal shall act loyally and honestly towards the commercial agent.
(2) It is especially incumbent upon the principal to
- make the necessary material regarding the goods in question available to the commercial agent;
- provide the agent with the information necessary for discharging the duties; and
- notify the agent within a reasonable time limit of acceptance or rejection of offers submitted and of any non-performance of an agreement brokered by the agent.
(3) If the principal anticipates that the level of agency business will be significantly lower than what the commercial agent would normally expect, the principal shall notify the agent accordingly within reasonable time .
(4) Paragraphs (1)-(3) may not be derogated from through an agreement.
If the commercial agent or the principal fails to fulfil its obligations owed to the other party, that party is entitled to compensation for the damage caused.
(2) The party claiming compensation shall notify the other party without undue delay, after becoming aware of the failure and the damage. If not, the right to compensation will lapse.
(3) Paragraph (2) shall not apply if the other party has acted contrary to good morals or with gross negligence.
If the commercial agent has goods in stock to be sold for the principal or bought for the principal, the agent holds the same obligations and rights with regard to the goods which the commission agent holds under Part II of the Danish Commission Act.
If the amount of commission has not been agreed upon, the commercial agent is entitled to compensation in accordance with what is customary for agents of this kind at the place where the agent carries on his business. In the absence of such custom, the agent is entitled to commission which is reasonable in view of all circumstances regarding the business.
The commercial agent is entitled to commission on an agreement concluded while the agency exists if
- the agreement has been concluded through the participation of the agent;
- the agreement has been concluded through no participation of the agent with a third party who the agent has previously acquired as a customer with respect to similar agreements; or
- the agent has been assigned a specific geographical area or a specific clientele, and the agreement, though no participation of the agent, has been concluded with a third party belonging to the area or the clientele.
If the agreement is concluded in circumstances as mentioned in article 9, sub 1-3, after the termination of the agency, the commercial agent is entitled to commission if the third party's offer reached the agent or the principal before the termination of the agency.
(2) The commercial agent is further entitled to commission if the agreement has mainly been brought about through the agent's business while the agency exists, and it has been concluded within reasonable time following the termination of the relationship.
(3) A newly appointed commercial agent is not entitled to commission under article 9 on an agreement on which the previous agent is entitled to commission under paragraphs (1)-(2), unless it is reasonably based on the circumstances to share the commission between the agents.
The right to commission will lapse as soon as and to the extent one of the following circumstances exists:
- the principal has or should have delivered the product or paid the purchase price according to the agreement with a third party.
- the third party has paid the purchase price or delivered the product or should have done so under the agreement with the principal if the principal had fulfilled his part of the agreement.
(2). An agreement according to which the commission falls due later than what is provided by paragraph (1), sub 2, is invalid.
The commission is payable on the last day of the month after the quarter in which the right to commission fell due, see Art. 11.
(2) Paragraph (1) shall not be derogated from to the detriment of the commercial agent.
The principal shall on the last day of the month after the quarter in which the right to commission fell due send the commercial agent a note regarding the commission that fell due in the quarter, see Art. 11. This note shall contain all significant information which has served as basis for the calculation of the commission.
(2) Paragraph (1) shall not be derogated from to the detriment of the commercial agent.
Handelsagentens krav på provision bortfalder kun, hvis det godtgøres, at aftalen mellem agenturgiveren og tredjemand ikke opfyldes, og dette ikke skyldes omstændigheder, der kan tilregnes agenturgiveren.
(2) Er tredjemands manglende opfyldelse en følge af, at agenturgiveren uden handelsagentens samtykke har givet tredjemand henstand med opfyldelse af aftalen eller har indgået overenskomst om ophævelse af denne, påvirker dette ikke agentens krav på provision.
(3) Opfyldes tredjemands forpligtelse efter aftalen kun delvis, har handelsagenten kun krav på provision af den del, der er opfyldt, medmindre andet følger af stk. (1)-(2).
(4) Stk. (1)-(3) kan ikke ved forudgående aftale fraviges til skade for handelsagenten.
(5) Bortfalder provisionskravet efter stk. (1), skal handelsagenten tilbagebetale modtagne provisionsbeløb.
The agent is entitled to receive from the principal all information, including extracts of accounting records, available to the principal and which the agent needs to enable him to verify whether the commission statement contains the amounts of commission which he has earned.
(2) If the principal refuses to supply the information referred to in paragraph (1), or if there is reasonable doubt as to the accuracy of the information or of the commission statement, the commercial agent may demand that the principal give the agent,a state-authorised or a registered public accountant appointed by the agent, access to examine extracts of the principal's accounting records.
(3) The duty according to paragraphs (1)-(2) will not apply if it would disclose information relating to matters in which the principal would otherwise be excused from giving evidence as a witness, cf. Art. 171 of the Administration of Justice Act.
(4) Paragraphs (1)-(2) cannot be derogated from through an agreement to the detriment of the commercial agent.
Relations with third parties
The agent may not, without special authorisation from the principal, enter into agreements that will bind the principal.
(2) If the agent has concluded an agreement without authorisation and which the principal will not approve, the principal shall notify the third party without undue delay after having been informed of the agreement. If the principal fails to do so, he shall be bound by the agreement if the third party was in good faith regarding the commercial agent's authorisation.
If the principal does not wish to accept an offer received by the commercial agent , the principal shall inform the third party accordingly without undue delay after having been informed of the offer. If he fails to do so, the offer will be deemed to be accepted.
(2) Paragraph (1) will not apply if the commercial agent and the third party have agreed that the offer shall explicitly be accepted by the principal.
If a third party has submitted an offer to the commercial agent and the commercial agent has forwarded the offer to the principal, the third party is entitled to withdraw the offer before or at the same time as the offer is brought to the principal's knowledge.
(2) Art. 1 will not apply if otherwise agreed between the commercial agent and the third party.
If a third party, who is engaged in business with the principal, after negotiations with the commercial agent, is informed that the principal accepts an agreement or an offer submitted by the agent, the third party shall inform the principal accordingly without undue delay if the third party considers that he has not concluded any agreement or submitted any offer, or that the agreement or offer is incorrectly stated. If the third party fails to do so, he shall be deemed to have concluded the agreement in accordance with the content of the notice given to the principal, unless otherwise proven.
The agent may not, without special authorisation, receive payment for sold goods or, after conclusion of the agreement, grant a respite for payment, a price reduction or any other alterations in the agreement.
(2) If the principal learns that the agent, without authorisation, has received payment or has adopted alterations in the agreement, the principal shall, if he does not wish to accept the payment or the alteration, inform the third party accordingly without undue delay. If he fails to do so, he will be deemed to have accepted the payment or alteration if the third party at the time of payment or alteration of the agreement was in good faith concerning the authorisation of the commercial agent.
(3) Paragraphs (1)-(2) apply mutatis mutandis where the agreement with a third party concerns the purchase of goods for the principal.
If a buyer wishes to claim a defect in purchased goods or a delay in delivery, or if the buyer wishes to complain to the principal of some other matter, he may contact the commercial agent if the commercial agent has participated at the conclusion of the agreement. The agent may not, without special authorisation, make any decision as a result of such inquiry.
(2) Paragraph 1 applies mutatis mutandis where the agreement with a third party concerns purchase of goods for the principal.
Termination of the agency agreement
If the agency agreement has not been concluded for a fixed period, the principal and the agent may terminate the agreement with a notice of one month within the first year of the agency agreement. The notice period is extended by one month for each commenced year or fraction of the agency agreement. However, the notice period cannot exceed six months, unless otherwise agreed.
(2) Shorter notice periods than those stated in article 1 cannot be stipulated by a prior agreement. However, it may be agreed that the agent may terminate the contract by giving three months’ notice, even if the agency agreement has been in force for three years or more.
(3) If the parties agree to a longer notice of termination than stated in article 1, the termination notice by the principal may not be shorter than the commercial agent's notice.
(4) Unless otherwise agreed, notice of termination shall expire at the end of a calendar month.
If the parties continue an agency agreement entered for a fixed period after the expiry of that period, article 22 applies mutatis mutandis . When calculating the termination notices in Art. 22(1), the fixed duration of the agency relationship will be taken into account.
Each of the parties may without observing the existing notice of termination terminate the agreement if the other party to a considerable extent has ceased to fulfil his obligations under the agreement or this Act.
Compensation in case of termination
Upon termination of the agency agreement , the commercial agent shall be entitled to compensation if and to the extent that
- the agent has brought new customers to the principal or substantially increased trade with the existing clientele, and if the principal will continue to benefit substantially from the relationship with those customers; and
- payment of compensation is reasonable in view of all circumstances, especially the agent's loss of commission on agreements with those customers.
(2) Paragraph (1) applies mutatis mutandis if the agency agreement is terminated as a result of the commercial agent's death.
Compensation under Art. 25 shall not exceed an amount equalling one year's consideration based on the commercial agent's average annual consideration during the past five years. If the agency agreement has lasted for a period shorter than five years, the amount is calculated based on the average consideration in that period.
The commercial agent is not entitled to compensation under Art. 25 if
- the principal terminates the agreement due to a material breach attributable to the agent;
- the agent terminates the agreement, unless justified by
a) circumstances attributable to the principal; or
b) the agent's age, weakness or illness so that it is not reasonable to demand that the agent continues his activities; or
- the agent, with the principal's consent, assigns his rights and obligations under the agency agreement to another party.
The commercial agent's claim for compensation under article 25 ceases if, one year after the termination of the agency agreement, the agent has not informed the principal that such claim for compensation will be made.
Art. 25-28 cannot be derogated from by prior agreement to the detriment of the commercial agent.
An agreement between a commercial agent and a principal stipulating that the agent's conduct of business after termination of the agency agreement shall be limited (competition clause) is binding on the agent only if and to the extent that the competition clause
- has been drawn up in writing;
- relates to the geographic area or the clientele assigned to the agent; and
- relates to goods of the type covered by the agency agreement.
(2) The competition clause may not exceed a period of two years after termination of the agency agreement.
(3) A competition clause may be set aside under Art. 38(1) of the Contracts Act.
For the purposes of this Act, a “commercial traveller” shall mean a person who, as part of a service relationship, has undertaken to canvass for customers, including promoting sale or purchase of goods which is not effected by obtaining offers (orders) to the employer or concluding agreements thereon in the name of the employer.
While performing work for a commercial firm, a commercial traveller may not without consent from the commercial firm, promote the sale of other goods than those of the commercial firm or purchases for others than the commercial firm.
Art. 9-10, Art. 11(1), Art. 12(1), Art. 13(1), Art. 14(1)-(3) and (5) and Art. 15(1)-(3) shall apply mutatis mutandis to commercial travellers remunerated wholly or partly with commission. However, the commission for commercial travellers will fall due on a monthly basis. In addition, Art. 14(5) shall only apply if the employment is not covered by the Salaried Employees Act.
Relations with third parties
Art. 16-21 shall apply mutatis mutandis .
Entry into force and interim provisions etc.
This Act comes into force the day after publication in the Danish Law Gazette.
(2) However, for agency agreements concluded before the Act comes into force, the previous rules shall apply until 1 January 1992. From 1 January 1992, this Act shall apply to such agreement, unless, before that date, the agreement has been lawfully terminated,no later than 30 June 1992. In such cases, the previous rules shall apply.
The Minister of Justice may lay down rules to implement the Hague Convention of 19 March 1978 as to which act shall apply to intermediaries and questions of authority.
This Act does not extend to Greenland and the Faeroe Islands except that all or any of the provisions hereof may be brought into force by Order in Council for Greenland subject to any variations in their operation necessitated by the specific conditions prevailing in Greenland.
2 May 1990