Legal Question in Business Law in New York

agent or distributor

a jewellery company is interested in doing business with me as I have an extensive network and know how in regions where they don't operate. I could be their exclusive agent or distributor for certain regions of the world- from a legal point of view, which are the pros and cons of the two options, apart from owning stock, etc.? thank you for your help!


Asked on 11/24/07, 10:37 pm

2 Answers from Attorneys

Nancy Delain Delain Law Office, PLLC

Re: agent or distributor

There is no answer to your question with the information you've given. There are many, many questions that I can think of right off the top of my head that I'd need good answers to before I could attempt an answer to your question.

For example:

Where is the jewelry company based? What's the ownership? How long have they been in business? Do they show a growing profit? Are they offering an exclusive or nonexclusive distributorship or agency? Is it called a distributorship or is it called an agency? What part of the world are you to work for them in? What law will govern the contract you'll sign with them? What would the distributorship or agency entail (sales? rainmaking? acquiring materials?)? What is their business model (mlm, stores, etc)? Etc etc etc etc....

Each answer has the potential to change the "legal point of view."

You're welcome to contact me offline to discuss potential representation in this matter if you wish.

THE INFORMATION PRESENTED HERE IS GENERAL IN NATURE AND IS NOT INTENDED, NOR SHOULD IT BE CONSTRUED, AS LEGAL ADVICE. THIS POSTING DOES NOT CREATE ANY ATTORNEY-CLIENT RELATIONSHIP BETWEEN US. FOR SPECIFIC ADVICE ABOUT YOUR PARTICULAR SITUATION, CONSULT YOUR ATTORNEY.

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Answered on 11/25/07, 12:20 am
William Frenkel Frenkel Sukhman LLP

Re: agent or distributor

One important general distinction between an agent and a distributor is that a distributor purchases its inventory and then resells it at its own risk to its own clients while an agent only locates potential customers with the sale finalized by the manufacturer. The manufacturer normally retains more control in an agency relationship although much would depend on the contract language. Incidentally, minority stock ownership is unlikely to give you any real control in this type of arrangement. Contact a commercial law attorney for advice.

The above reply is in the nature of general information, is not legal advice nd should not be relied on as such.

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Answered on 11/25/07, 4:47 am


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