Commercial agent contracts

Over the last few months, Cologne Higher Regional Court in particular had to consider central issues of commercial agent law in several decisions. It provided important practical tips such as on statements of account, compensation claims and the term documentation as defined in section 86a of the German Commercial Code (Handelsgesetzbuch – HGB). Other classic topics of commercial agent law have occupied the courts too.

Cases of doubt

Cologne Higher Regional Court clarified that it is not a “case of doubt” to be included in a statement of account according to section 87c(2) of the German Commercial Code if the parties simply disagree on the legal scope of the commission agreement. In principle, a statement of account must only contain commission-related information – the commercial agent cannot demand more extensive information in a statement of account. In case law, however, it is recognised that a statement of account must also contain information on “cases of doubt” where it is questionable whether there is a right to commission or not (see: Hamm Higher Regional Court, judgment of 13 December 2021 – I-18 U 31/21). Cologne Higher Regional Court has now clarified that a case of doubt does not exist if the existence of a claim to commission in an established factual situation depends solely on the legal assessment. The court must therefore clarify the meaning and scope of the commission agreement at the information stage. The principal does not have to include information in the statement of account about alleged commission claims that do not exist from the outset according to the contractual commission agreement.

One-off commission

In addition, Cologne Higher Regional Court clarified with regard to the judgment of the CJEU on 23 March 2023 in the case C-574/21 that a compensation claim cannot be excluded from the outset when agreeing on one-off commission. However, it also emphasised that the commercial agent’s lack of commission losses must be taken into account at an equity level. If there are no commission losses, according to Cologne Higher Regional Court, further equity reasons must arise that can exceptionally justify a compensation claim by the commercial agent without incurring commission losses.

Definition of documentation

Cologne Higher Regional Court considered the definition of the term “documentation” under section 86a(1) of the German Commercial Code, which states that the principal shall provide the commercial agent with the documentation necessary free of charge. Cologne Higher Regional Court confirmed the case law to date that the term “documentation” is to be interpreted broadly beyond the wording of the legal standard, whereas the term “necessary” is to be interpreted restrictively. The documentation to be provided by the principal (free of charge) according to section 86a(1) of the German Commercial Code therefore includes only the aids from the principal’s sphere which the commercial agent specifically needs to exercise its activity at all. The case to be decided by Cologne Higher Regional Court was about a workplace system consisting of a common standard software which had to be used to connect to the principal’s IT systems. The principal provided this workplace system for a flat fee. However, since the principal had forbidden the commercial agent from using the workplace system for any activities other than brokering new business as an intermediary, in the view of Cologne Higher Regional Court the system was not part of the commercial agent’s general office equipment but necessary documentation to be provided free of charge by the principal within the meaning of section 86a(1) of the German Commercial Code. As a consequence, the fee charged by the principal was to be refunded based on the principle of the law of unjustified enrichment.

Blocking not cancelling; right to commission for de facto contract renewals

Dusseldorf Higher Regional Court considered whether the principal in the event of a breach of duty by the commercial agent can suspend deliveries to the agent rather than terminating the contract without notice. In the case to be decided by Dusseldorf Higher Regional Court there was a suspicion that the commercial agent had misappropriated goods belonging to the principal. The commercial agent did not comply with the principal’s demand to explain where the goods were. It did not reply to the principal’s questions. Instead of terminating the commercial agent contract without notice pursuant to section 89a(1) of the German Commercial Code, the principal then stopped supplying the commercial agent with the goods. Dusseldorf Higher Regional Court ruled that such an approach may be permissible as a milder alternative to termination without notice (based on suspicion) in certain cases if the principal’s interest in its freedom to conduct its business outweighs the privileged concerns of the commercial agent.

In addition, Dusseldorf Higher Regional Court had to consider how commission is to be earned for “contract renewals”. The principal had promised its commercial agent commission for contract renewals. However, the interpretation of the commercial agent contract in that case showed that only a follow-on contract for an existing customer procured by the commercial agent was meant, not a de facto contract renewal that comes about because the customer does not terminate the contract procured by the commercial agent at the end of the minimum term. Merely automatic renewal of the term of an existing mobile phone contract because the customer did not terminate it is per se not a commission-earning transaction, the court said. Thus Dusseldorf Higher Regional Court changes its previous legal opinion and follows the case law of the Federal Court of Justice. The Federal Court of Justice ruled back in 2010 that automatic term renewals because the customer did not terminate the contract are not customarily a commission-earning transaction (see Federal Court of Justice, NJW 2010, 298).

Obstacle to termination

Munich Higher Regional Court once again had to deal with a case in which a contractual arrangement led to an unlawful obstacle to termination by the commercial agent according to the first sentence of section 89(2) of the German Commercial Code. Contractual arrangements which make it more difficult for a commercial agent to terminate a commercial agent contract are increasingly being argued in court. In the case now to be decided by Munich Higher Regional Court, the commercial agent was due to lose its right to various commission elements and an office expenses subsidy immediately after giving notice of termination. Munich Higher Regional Court held that the commercial agent thus lost approx. 97 % of its income but at the same time was still bound by unrestricted obligations until the end of the contract. Munich Higher Regional Court held this to be unreasonable partly due to a comparatively short notice period of just three months. The arrangement was therefore null and void according to the first sentence of section 89(2) of the German Commercial Code in conjunction with section 134 of the German Civil Code.

This article is part of the "Update Commercial 2025". All insights and the entire report as a PDF can be found here.