Who is a Commercial Agent – the Plot thickens

The Commercial Agent Directive 86/653/EEC (as implemented in the UK by means of the Commercial Agent (Council Directive) Regulations 1993 continues to make new waves in the law on international trade. It is not deniable that the Regulations fill an important gap in English common law by providing for the fair compensation of the commercial agent following the termination of the agency agreement. However, they introduce into English law a new species in law - the commercial agent. Indeed, the Law Commission stated in 1977 that it was ‘unable to identify such a social group in England’ (Law Com No 84 (1977), para 19). This new entity is given a formal definition ¹ in the Regulations but its true nature is most complicated as emerging case law is attesting. This is regrettable to the extent that principals and agents are frequently not in the position to say what their relationship really is and it makes it all the more difficult for firms to make provision for any financial contingency arising from the termination and compensation rules under the Regulations.