The Regulation of Commercial Agency Relationships in Europe

Hiring a foreign representative permits a business to expand the geographic scope of its marketing operations, while a local presence allows the foreign business to service and maintain the products sold in the host market. The major drawback to this decision is that by retaining a foreign representative, the business is enmeshed in the host country's regulation of these relationships. The notion that the business and representative are completely free to make their own arrangements without governmental intervention is not accurate. Host country governmental regulation of commercial agency relationships, if unknown or ignored by the business, can prove nettlesome and costly.