Many investors, when entering the Dominican market, do not take into consideration local legislation on agency relationship and proceed to grant product distribution rights to local representatives without investigating the consequences of their consent to local distribution.
Law 173 on Protection of Import Agents protects the rights of local distributors and agents by mandating payment of substantial indemnities in case of unilateral termination of contracts by foreign licensors. Although Law 173 has been severely criticized because of its overprotective nature, foreign licensors may take certain steps to avoid its reach.
Jiménez Cruz Peña routinely assists foreign companies with mitigating the extremely protective nature of Law 173. JCP successfully represented foreign grantors in entering into and terminating distribution contracts governed by Law 173, opting out of Law 173 for DR-CAFTA governed contracts, negotiating settlement agreements, opposing registrations with the Central Bank, setting up subsidiaries with the right to grant distribution licenses locally, as well as employing other strategies to avoid effect of Law 173 and handling any arising litigation.
Services
Setting up new distributorship relationships with local distributors:
Negotiation of a distributorship contract
Setting up local distribution subsidiaries
Registration of distributorship contract at the Central Bank
Opting out of Law 173 for U.S. based companies
Modifying or terminating existing distributorship relationships:
Negotiating settlement agreements
Cancelation of registrations with the Central Bank
Litigation arising out of distributorship relationships:
Opposing registrations of distributorship contracts at the Central Bank
Defense of foreign grantors in termination of distributorship agreements
Industries:
Consumer goods
Food and beverage products
Pharmaceutical products and medical supplies
Key Representations
Representation of one of the largest Japanese distributors of canned products and other consumer goods in connection with termination of a distributorship contract with a local producer and setting up a local distribution subsidiary
Represented an international alcoholic beverages producer in connection with entering into local distributorship agreements and their registration with the Central Bank
Desde su concepción institución jurídica, el arbitraje ha sido reconocido como un proceso consensual y voluntario, de donde la cláusula arbitral es idealmente el resultado de una negociación equilibrada entre las partes del contrato. Sin embargo, en la arena de los contratos de adhesión se veri ca una excepción a esta regla, toda vez que la capacidad de al menos una de las partes de negociar los término y condiciones de la transacción puede encontrarse visiblemente restringida, en tanto que la contraparte (i.e. quien ofrece el bien o servicio de que se trate) posee considerable poder de negociación, con lo cual constriñe a la otra a aceptar al arbitraje como alternativa a la justicia ordinaria y sin lo cual esta última no podrá acceder al bien o servicio pretendido.
