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Distribution License Agreement for Philippines

Distribution License Agreement Template for Philippines

A comprehensive legal agreement governed by Philippine law that establishes the terms and conditions under which a licensor grants rights to a distributor to sell, market, and distribute specific products or services within defined territories in the Philippines. The agreement incorporates local regulatory requirements, including those under the Intellectual Property Code of the Philippines and the Philippine Competition Act, while addressing crucial aspects such as exclusivity, quality control, pricing, and compliance with local commercial laws.

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Distribution License Agreement

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What is a Distribution License Agreement?

A Distribution License Agreement is essential for businesses seeking to establish formal distribution channels in the Philippines while protecting their intellectual property rights and commercial interests. This agreement is particularly relevant for foreign companies entering the Philippine market through local distributors, as well as domestic companies expanding their distribution networks. The document must comply with Philippine legislation, including the Intellectual Property Code (Republic Act No. 8293), the Civil Code, and the Philippine Competition Act. It typically covers critical elements such as territory rights, exclusivity provisions, quality control measures, minimum purchase requirements, and pricing structures. The agreement is designed to create a clear framework for the business relationship while ensuring compliance with local laws regarding distribution arrangements, foreign investment restrictions, and consumer protection requirements.

What sections should be included in a Distribution License Agreement?

1. Parties: Identifies the licensor and distributor with their complete legal details

2. Background: Explains the context of the agreement, including the licensor's ownership of the products/IP and the distributor's business

3. Definitions: Defines key terms used throughout the agreement

4. Grant of License: Specifies the scope, nature, and limitations of the distribution license

5. Territory and Exclusivity: Defines the geographic area and whether rights are exclusive or non-exclusive

6. Term and Termination: Specifies duration, renewal options, and termination conditions

7. Distributor Obligations: Details the distributor's responsibilities, including sales targets and marketing requirements

8. Licensor Obligations: Outlines the licensor's commitments regarding product supply and support

9. Intellectual Property Rights: Protects the licensor's IP and specifies allowed usage

10. Quality Control: Sets standards for product handling, storage, and distribution

11. Pricing and Payment Terms: Details pricing structure, payment terms, and financial obligations

12. Reporting and Audit Rights: Specifies reporting requirements and licensor's audit rights

13. Warranties and Indemnities: Contains warranties, representations, and indemnification provisions

14. Confidentiality: Protects confidential information of both parties

15. Governing Law and Dispute Resolution: Specifies Philippine law as governing law and outlines dispute resolution mechanisms

16. General Provisions: Includes standard boilerplate clauses like force majeure, notices, and assignment

What sections are optional to include in a Distribution License Agreement?

1. Minimum Purchase Requirements: Used when specific purchase quotas are required

2. Digital Distribution Rights: Include when distribution involves online or electronic channels

3. Sub-Distribution Rights: Added when sub-distributors may be appointed

4. Marketing and Promotion: Detailed section when specific marketing obligations exist

5. Training Requirements: Include when product complexity requires distributor training

6. Insurance Requirements: Added for high-value or high-risk products

7. Export Control: Include when products may be subject to export regulations

8. Data Protection: Required when personal data processing is involved

9. Post-Termination Obligations: Detailed section when complex wind-down provisions are needed

What schedules should be included in a Distribution License Agreement?

1. Schedule 1 - Licensed Products: Detailed list and specifications of products covered by the agreement

2. Schedule 2 - Territory Description: Detailed description of geographic territories and any exclusions

3. Schedule 3 - Pricing Schedule: Price lists, discount structures, and payment terms

4. Schedule 4 - Quality Standards: Detailed quality control requirements and procedures

5. Schedule 5 - Performance Targets: Sales targets and performance metrics

6. Schedule 6 - Trademark Usage Guidelines: Guidelines for using licensor's trademarks and branding

7. Schedule 7 - Reporting Templates: Standard forms for required periodic reports

8. Appendix A - Technical Specifications: Detailed technical information about the products

9. Appendix B - Support Services: Details of technical support and maintenance services

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Philippines

Publisher

Ƶ

Cost

Free to use
Relevant legal definitions




















































Clauses

















































Relevant Industries

Consumer Goods

Pharmaceuticals

Technology and Software

Automotive

Electronics

Fashion and Luxury Goods

Food and Beverage

Industrial Equipment

Healthcare Products

Telecommunications

Media and Entertainment

Agricultural Products

Relevant Teams

Legal

Commercial

Sales

Business Development

Distribution

Compliance

Executive Leadership

Supply Chain

Operations

Intellectual Property

Contract Administration

Relevant Roles

Legal Counsel

Commercial Director

Sales Director

Business Development Manager

Distribution Manager

Compliance Officer

Chief Executive Officer

Chief Commercial Officer

Supply Chain Manager

Operations Director

Intellectual Property Manager

Contract Administrator

Regional Sales Manager

Territory Manager

Product Manager

Industries







Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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