Document background
The Intercompany Distribution Agreement is essential for South African corporate groups looking to formalize their internal distribution arrangements while maintaining compliance with local regulations. This document is particularly relevant when a group company needs to appoint another group entity as a distributor of its products within a specified territory. The agreement must carefully balance group commercial interests with legal requirements, including South African competition law, transfer pricing regulations, and exchange control requirements. It should be used when establishing new distribution channels within a corporate group or updating existing arrangements to ensure compliance with current legislation. The agreement typically includes detailed provisions on product supply, pricing mechanisms, performance standards, and group policy compliance, while maintaining sufficient independence between the parties to satisfy arm's length requirements under South African law.
