Distributor Agreement – Price, Territory, Exclusivity and Competition Law
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Short answer: A distribution agreement regulates how a distributor purchases products or services on their own account and resells them. The agreement should clearly distinguish between resale and commission/agency while also addressing the limitations of competition law.
| Price and discount | Purchase price, discount model, promotions, and price changes. |
| Territory | Which area or customer groups is the distributor allowed to target? |
| Exclusivity | Is the distributor the sole provider in the area – and what performance requirements apply then? |
| Competition law | The supplier should not enter into agreements regarding prohibited control of the distributor’s retail price or other prohibited vertical restraints. |
The distributor sells on their own account
Unlike a commission agent or sales agent, the distributor typically purchases the products and bears their own commercial risk for inventory and resale.
Price and recommended prices
The supplier can normally communicate recommended or maximum prices within the framework of competition law, but agreements on fixed or minimum resale prices are a specific area of risk. The Swedish Competition Authority explicitly highlights price control as an example of problematic vertical restraints.
Territory and e-commerce
Geographical restrictions and rules on active versus passive sales must be drafted with regard to EU and Swedish competition law. E-commerce makes this demarcation particularly important.
Exclusivity and performance requirements
If the distributor is granted exclusivity, the agreement should simultaneously specify minimum purchases, sales targets, inventory holding, marketing, and the consequences if the targets are not met.
Other key clauses
- orders and delivery,
- warranty and complaints,
- trademark usage,
- product information and marketing,
- forecasts,
- inventory at the end of the agreement,
- confidentiality and trade secrets.
Distribution Agreement 2026/2027
The template package contains Swedish and English versions with clauses for distribution, territory, e-commerce, trademarks, and competition law.
FAQ
Is the supplier allowed to determine the distributor's final price?
Fixed or minimum resale prices are a clear area of risk under competition law and should not be implemented without qualified analysis.
What is the difference from a commission agreement?
The distributor typically buys on their own account. The commission agent acts in their own name but on behalf of the principal.
Can the distributor be given an exclusive territory?
Yes, but the exclusivity rules must be designed to be compatible with competition law.
This article provides general information and does not replace individual legal advice. Agreements, collective bargaining agreements, and the circumstances of each individual case may affect the assessment.
