Article X.18, paragraph 1, of the Belgian Economic Law Code stipulates that after the termination of a commercial agency contract, the commercial agent is entitled to compensation for clientele if they have brought new clients to the principal or have significantly developed business with existing clients, insofar as this can still provide considerable benefits to the principal.
Under the third paragraph of this article, the amount of this compensation is determined by taking into account both the expansion of business achieved and the contribution of clients. The fourth paragraph of this article stipulates that the client compensation may not exceed the amount of one year’s remuneration calculated on the basis of the average of the previous five years or on the basis of the average compensation of the previous years if the commercial agency contract lasted less than five years.
The Belgian Court of Cassation recently emphasised that this legal ceiling of one year’s remuneration only applies if the client compensation calculated on the basis of the circumstances of the case exceeds this ceiling. In such cases, the compensation will be reduced to a maximum of one year.
-> Consequently, to calculate the amount of client compensation, it is not sufficient to simply apply a fair percentage to the legal ceiling of one year.
For example, if it is roughly estimated that 25% of the clientele will be lost following the agent’s departure, this does not justify valuing the client compensation at 75% of the legal ceiling of one year.
The benefits that the principal derives from transactions with customers brought in by the agent must be quantified and then checked to ensure that they do not exceed the legal limit (one year’s remuneration).
It is worth noting that the commercial agent may also be entitled to damages to compensate for losses other than the loss of clientele, but it is up to them to prove the extent of their loss.
Article by LEXENA
