Agency Agreement In Kuwait

Kuwaiti law does not define the measure of “damage” or “fair compensation” that the foreign client may owe to the local agent. Damages and compensation are determined on a case-by-case basis at the discretion of the Kuwaiti court. The courts will consider all the circumstances they deem relevant, including the duration of the agreement, the number of employees, the number of branches, outlets or workshops, the previous turnover volume and estimated shortfall, as well as the costs incurred by the agent. The investor must enter into an agency contract and register it by the Chamber of Commerce and the Department of Commerce. The application is accompanied by an official copy of the agency contract and the statutes and statutes of the Kuwaiti company. The registration of the agency contract can take up to 15 days. Article 281 of the Code of Commerce stipulates that when a contractor terminates an agency contract without cause, the client pays the agent compensation for the resulting damages. A contrary agreement is considered null and void. Much of the old law has remained the same, leading to criticism that CAL is not broad enough. Instead of reforming agency laws in Kuwait, CAL focuses on procedure and clarifying the cumbersome formalities required to have an agent in Kuwait. In addition, it should be noted that the Commercial Agencies Act also allows the client to obtain compensation from the representative for any damages if the representative abandons the Agency at an inappropriate time and without appropriate apologies. In accordance with Article 274 of convention, the ContractIng Agency`s agreement is established in writing when it sets, among other things, the Agency`s limits, the remuneration of the representative and the area of its activity, in addition to the duration of the contract, if it is limited, and, if applicable, the mark of the goods subject to the contract. Kuwaiti nationals and companies registered in the country are the only entities authorized to act as agents in the country.

In addition, these agents should also be registered and approved in the MCI trade register. An agent of the structure of the Kuwaiti trade agency is entitled to a remuneration or commission from the client for the volume of work he performs. In addition, the Commercial Agencies Act goes further and gives the agent the right to demand compensation for transactions concluded or facilitated directly by the client or others in the agent`s territory. Therefore, it could be inferred from these provisions that the agent enjoys a right and better protection, as is generally the case with the legislation of trade agencies in most GCC countries. Under Section 286 of the CL, any distribution contract under which a distributor undertakes to promote and distribute products of an industrial or commercial company in a given territory, to the extent that it is the sole distributor, is considered a contractual agency constructively and is therefore subject to the provisions of Articles 275, 281 282, 283, 284 and 285 of it.” The agent is responsible for all debts of the adjudicator power arising from the activities of the adjudicator power carried out in the country and as defined in the agency agreement.

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