January 4, 2025

Victory for a Multinational Japanese Medical Devices Manufacturer: Court Clarifies Agency vs. Distribution

We are proud to announce a significant legal victory secured by our firm on behalf of a leading multinational Japanese medical devices manufacturer in a complex dispute with its local distributor in Egypt. This case revolved around the nuanced distinction between agency and distribution agreements—a critical yet often misunderstood area of law.

The local distributor initiated legal proceedings, claiming their relationship with our client constituted a commercial agency agreement under Egyptian law. Such a designation would have entitled the distributor to substantial protections, including compensation upon termination. However, through meticulous legal arguments and strategic advocacy, our team successfully demonstrated that the relationship was, in fact, one of distribution and not agency.

Key to this outcome was the court’s agreement with our arguments, affirming the criteria for distinguishing between agency and distribution agreements. We demonstrated that the local distributor had never received the commissions typically indicative of an agency relationship and that the agreement’s registration with regulatory authorities served purely procedural purposes. As a result, the court confirmed our client’s right to terminate the agreement without any obligation to pay compensation. Additionally, the court ordered the local distributor to compensate our client for breaching its contractual obligations, recognizing the distributor’s failure to fulfill its duties under the agreement.

This judgment was further upheld at the appeal stage after an long battle and exhaustive examination of the facts by court-appointed experts. The appellate court’s ruling reinforces the importance of precisely defining contractual relationships and sets a precedent for similar disputes in the future.

This significant achievement was led by our esteemed litigation team, spearheaded by our Partner Dr. Fatma Salah and Senior Associate Ahmed Waheed. Their expertise, strategic insight, and dedication were pivotal in securing this result and further demonstrate the exceptional capabilities of our litigation team.

Our firm’s success in this case reflects our deep expertise and hands-on experience in structuring agency and distribution arrangements between foreign companies and local partners. We provide comprehensive legal support in ensuring regulatory compliance, handling necessary registrations for procurement and importation purposes, and navigating the complexities of dispute resolution in this area.

This victory underscores our commitment to achieving favorable outcomes for our clients while clarifying critical legal issues for the broader business community. If your business is navigating the challenges of agency or distribution agreements, our team is ready to provide tailored advice to meet your needs.

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