Germany
- The core statutory regime is contained in sections 84–92c of the German Commercial Code (Handelsgesetzbuch, hereinafter abbreviated to “HGB”).
These provisions regulate, inter alia, the definition of a commercial agent (section 84 HGB), duties of agent and principal (sections 86, 86a HGB), commission (sections 87–87d HGB), termination (sections 89, 89a HGB) and, in particular, the post‑termination goodwill indemnity (section 89b HGB).
Section 89b HGB implements Articles 17–19 of Directive 86/653/EEC on self‑employed commercial agents. Parts of this regime are mandatory in favour of the agent, including the indemnity and certain minimum rights (e.g. written confirmation, minimum notice periods, commission rules).
In addition, general contract law of the German Civil Code (Bürgerliches Gesetzbuch, hereinafter abbreviated to “BGB”) applies, including the validity requirements for clauses in standard form contracts (sections 305 et seq. BGB) and the general law of limitation (sections 194 et seq. BGB).
- Commercial agents under section 84 (1) HGB are self‑employed intermediaries and not employees. Therefore, standard collective bargaining agreements under German labour law do not apply to them.
Only where a purported “agent” is in truth an employee or an employee‑like person would labour and collective bargaining law become relevant; in that case, however, the relationship is no longer governed by sections 84 et seq. HGB in the strict sense.
- Upon termination of the agency contract, the commercial agent can claim a “goodwill indemnity” under section 89b (1) HGB if and to the extent that:
(i) the principal continues to obtain substantial advantages from business with new customers (or substantially intensified existing customers) acquired by the agent,
(ii) the agent loses commission claims which he would have had upon continuation of the relationship, and
(iii) payment of an indemnity is equitable, taking all circumstances into account.The indemnity is capped at a maximum of one year’s remuneration based on the average of the last five years (or the shorter contract duration).
The claim arises by operation of law and cannot be excluded in advance; any clause excluding or effectively undermining it is, as a rule, invalid (section 89b (4) sentence 1 HGB).
The claim is excluded in particular if the agent resigns without cause attributable to the principal or if the principal terminates for cause due to culpable conduct of the agent (section 89b (3) HGB).
- The indemnity claim is subject to a substantive exclusion period: in order not to forfeit the right, the agent must assert the claim against the principal within the statutory period after termination (section 89b (4) HGB). This notification can be informal and does not require a quantified amount.
If the claim is not asserted in time, it is definitively lost (forfeiture), irrespective of the general limitation periods under sections 194 et seq. BGB.
- Dr Fabienne Kutscher-Puis (fkp@kutscher-puis.com)
