New book keeps pace with new model contract rules
Paris, 25 October 2002 - In a recent interview, the chairman of ICC's Commission on Commercial Practice, Professor Fabio Bortolotti explained how changes to European antitrust rules led to the recent publication of ICC Model Distributorship Contract - Second Edition.
An interview with Dr Fabio Bortolotti, chairman of the ICC Working Party responsible for the 2002 revision of the
ICC Model Distributorship Contract (sole importer-distributor)
ICC
Can you explain why the first edition model distributorship contract became a great success with some 6000 copies sold?
Bortolotti
The ICC model distributorship contract has been the second model contract published by the ICC. After the great success of the agency model, the commission on commercial practice proposed to draft also a distributorship contract. Following the same approach used for the agency contract the working party, composed of some of the best specialists in the field of distribution law, worked out a model with really new features: clear and balanced clauses, detailed annexes, etc. This is in my opinion the main reason for the success of this initiative.
ICC
What are the special features of ICC models?
Bortolotti
We have, since the very beginning, tried to draft models which take into due account the interests of both parties involved. These "balanced" models are a very useful tool for parties which are not interested in overprotecting their interests but simply desire to make a fair deal, without needing to discuss all aspects of it. At the same time the ICC models are a very useful basis for working out an individual contract, since they are drafted by people who know the practice of international trade and who are experienced in drafting contracts, and thus warrant a very high quality level.
ICC
Why was a new edition of the distributorship model required?
Bortolotti
The first edition of this model was made many years ago. In the meantime the legal environment has changed and the needs of the users too. In the year 1999 there has been an important change in the European antitrust rules (Regulation 2790/1999) which made it necessary to adapt certain clauses to the new rules. And, more generally, we have been able to work out new and improved contractual solutions which have been transposed in the new edition.
ICC
What is the difference between this model and the "short form"?
Bortolotti
The short form distributorship model is a simplified contract, to be used when it is more important for the parties to have a short contract than to have a complete one. However, the short form implies that a number of important problems are not dealt with. A more complete contract certainly gives the opportunity to discuss and agree upon a larger number of issues. This means that many important aspects will be covered and in case of disagreement during their relationship the parties will find a solution in the contract itself. Of course this will not prevent any dispute, but the fact of having discussed and resolved certain matters from the very beginning in the contract itself certainly reduces the risk of litigation.
ICC
How is the model actually to be used?
Bortolotti
The model is drafted in such a way that the parties can use it as it is, by adding their names, choosing between the main alternatives and filling in the spaces left blank. We have in particular tried to give in the annexes a number of alternative solutions which cover the most common practices. However, the users can also transfer the model to their computer (a CD-ROM is enclosed) and then work on it and make the necessary adaptations.
ICC
Are new model contracts to be expected in the future?
Bortolotti
We are completing the models in the field of distribution, where we add to the existing contracts (agency, distributorship, occasional intermediaries) a model contract on selective distribution. But we are also engaging in totally new fields. In particular we are working on a M&A (Merger and acquisition) contract and on turnkey contracts, which we hope to finish in the year 2003.
Order ICC Model Distributorship Contract