According to the U.S. Constitution, any power that is not specifically reserved for the federal government remains in state hands. Federal law is exclusively responsible for certain types of cases (for example. B those involving federal laws, interstate controversies and cases with foreign governments) and shares jurisdiction with national jurisdiction in some other areas (for example. B, cases involving parties residing in different states). However, in the vast majority of cases, state law is exclusively competent. Similarly, under U.S. law, the doctrine of contractual freedom has a direct impact on the way distribution agreements are regulated in the United States. Think about your intellectual property: if you appoint a distributor, you also license the use of your intellectual property for distribution purposes. You give them access to your most sensitive assets. It is allowed to use your domain name, logo and trademarks.
If these issues are not specifically addressed in the agreement, this can lead to situations where your distributor takes possession of your intellectual property and effectively blocks you out of the territory. It is shared among foreign producers that the law governing a distribution agreement with a U.S. trading partner should be that of their country. However, the prosecution of a U.S. accused in the supplier`s home country does not make much legal and practical sense. There are many reasons for this. Think about territorial coverage: the territorial scope of your distribution agreement is not just a matter of geography. For example, if exclusive rights are granted for the marketing of a particular product on the east coast of the United States, it should be noted that those rights are not infringed if the same product can enter the territory through an OEM partner incorporated into another product. You should specify exactly all kinds of channels through which the product can enter the market and thus protect against future conflicts with your distributor. An international distribution agreement is essentially a contract that establishes a framework for a business relationship between the global parties.
In order to ensure efficient and efficient transactions, an international distribution agreement should be comprehensive. Under the law of most states (including New York), a distributor can appoint negotiators without the agency agreement being subject to contrary restrictions.