Agency Agreement Egypt

The Egyptian Law on Commercial Agency Contracts is subject in part to the Law on Agents (Law No. 120/1982) and in part to the Commercial Code (Law No. 17/1999, in force since 01.10.1999). While the Agents Act is limited to official regulations (registration, accounting, etc.), Articles 148 et seq. of the Commercial Code prescribe the most important substantive requirements for the agency relationship. According to the commercial agency contract, a commercial agent acquires on behalf of the other, this client, the task of promoting the conclusion of transactions or concluding them himself, on a permanent basis, against payment of a commission resulting from the turnover of transactions directly promoted or concluded. A distinction is made between the agent for the promotion of trades („commissionaire“ or in Arabic „wakîl bi-l-umûlât“) and the agent for the conclusion of business („contract agent“ or in Arabic „wakîl al-` uqûd“). The representative of the natural person must have Egyptian nationality. However, in the case of the legal entity, it must be wholly or for the majority of the shares held by Egyptian citizens and must have its headquarters in Egypt. The agent does not necessarily have to be self-employed, but he cannot be an employee of a state-owned enterprise or any of its agencies or subsidiaries, nor a civil servant. In addition, the agent may not be a direct relative of a member of the legislative or executive branch or of a senior official. Legal and natural persons carrying out the activity of the agent must be registered in the register of agents or mediators kept by the Ministry of the Economy and Foreign Trade.

If the main foreign legal person grants the agent the power of representation, the agency contract must be validated by the Egyptian Chamber of Commerce or another similar institution or, in the case of an agreement abroad, by the Egyptian consulate. Foreign companies or entities may not provide scientific, technical, consulting or other services unless they have a commercial agent in Egypt in accordance with Egyptian laws and regulations. These companies and entities may only perform any act of commercial representation or mediation through a registered agent or commercial intermediary. `Without prejudice to the provisions of international agreements in force in the Arab Republic of Egypt, the provisions of this Agreement shall apply to all arbitrations between parties by persons governed by public or private law, irrespective of the legal relationship to which the dispute relates, where such arbitration takes place in Egypt or in the case of international commercial arbitration conducted abroad and its parties: have agreed to subject it to the provisions of this Act. » Frequent disputes and problems arising from distribution and agency contracts The commercial agent keeps regular books of accounts containing truthful data and records in these books all commissions due to him and to the banks with which these amounts are deposited. The commercial agent shall also inform the competent department of the Register of Commercial Agents and Mediators if he ceases his activity within 30 days of the end of the activity. Without prejudice to a more severe penalty provided for by any other law, any person who commits any of the following measures shall be liable to deprivation of liberty for at least 6 months and a fine of at least EGP 500 and a maximum of EGP 10000 or to one of these two penalties; – exercise the profession of commercial agent or exercise a commercial mediation activity without being registered in the commercial register. – register or renew its registration in the register of commercial agents and mediators on the basis of incorrect information on compliance with the conditions for registration. Any commercial agent or mediator who continues to carry out his activity intentionally after the expiry of one of the requirements is liable to a custodial sentence not exceeding 6 months and a fine of up to EGP 5000 or one of the two penalties. In Egypt, commercial agency contracts are governed by Law No.

120/1982 (the „Commercial Agents Law“) and Law No. 17/1999 (the „Commercial Law“), which govern brokerage and commercial brokerage activities. They define the most important rights and obligations of an agent and the company/person represented by the agent. The Contractor shall indemnify the Client for damages suffered by him if he visits the Agency at an inappropriate time and without reasonable excuse. (Art. 188 Trade Act) Procedure In accordance with Article 714 of the Civil Code, unless the parties have agreed otherwise, the commercial agency contract terminates upon completion of the work or on the expiry of the period for which it was granted or on the death of the agent or client. Law 120/1982 is mandatory and representatives or customers cannot withdraw from the legislation. Law 120/1982 does not exclude agents whose agency activity is secondary, i.e. their activities are not the main subject of the agency contract with their client. For the purposes of this Act, the commercial mediator is the person whose activity – even if he has carried out only one transaction – is limited to the search for a contractor or the negotiation with such a contractor in order to persuade him to conclude a contract, as well as any person who must carry out a transaction of the commercial agency, even if he is not accustomed to such operations and performs it only once or if this person has a contract of employment. has entered into a contract with the manufacturer, distributor or distributor. In accordance with Article 188 of the Commercial Code, the commercial agency contract is concluded in the common interest of the parties. If the contract is concluded for an indefinite period, the customer will not terminate it, unless the entrepreneur is at fault, otherwise the customer must compensate the entrepreneur for the damages he suffered as a result of the termination.

Any divergent agreement is null and void. Therefore, the distribution contract is an agreement concluded between an undertaking supplying goods and the distributor distributing those goods. Distribution agreements are subject to the general provisions of the Egyptian Civil and Commercial Code, as there is no specific law governing these types of contracts. `In the event that the principal refuses to renew the final agency contract without the agent having committed an error or failure in the performance of the agency contract, the principal shall be obliged to compensate the contractor for the damage caused as a result if the agent`s activity has led to obvious success in promoting the goods or increasing the number of customers.` Commercial law prevents the parties from applying foreign law to the agency contract. .