European Council Directive 86/653 has been transposed into Belgian law by law of 13 April 1995. It regulates the contract whereby a principal commissions a self-employed agent to negotiate and/or sign contracts in his name and on his behalf.
The principal must give the agent all the necessary documentation and information and he must also inform the agent, within a reasonable period of time, of the acceptance, refusal or non-execution of a transaction negotiated by the agent. The agent must protect the principal's interests, provide him with all necessary information, and follow all reasonable instructions.
The agent is entitled to a commission fee in the form of a fixed periodic fee (e.g. a monthly fee) or in the form of a transaction related commission fee. A combination of both is also acceptable. Unless criteria have been laid down to calculate the commission fee, it is determined either by reference to the economic sector or as a percentage which is equitable in the specific circumstances of the transaction.
Unless otherwise agreed, the agency contract is for an indefinite duration. Both parties then have the right to terminate the contract in advance by serving notice to the other. The period of notice is one month per year of service, with a maximum of six months (which can be extended). The agreement can also be terminated with immediate effect if there is a serious cause which needs to be invoked within seven working days.
After the end of the agency agreement, the agent may be entitled to a commission fee for transactions which he has negotiated or started, an (additional) indemnity in lieu of notice if insufficient notice has been served, and an indemnity for goodwill if he has significantly enlarged the principal's customer base or turnover.
A non-competition clause (for a maximum of 6 months) is not valid, unless agreed in writing and restricted to the type of business for which the agent was appointed and to the geographical territory or the group of potential customers assigned to the agent. If there is a non-competition clause, the principal will have to pay an indemnity for goodwill.
If the agent is established in Belgium, Belgian law governs the agency agreement, and any dispute must be submitted to the Belgian courts.