The Independent Sales Representative Agreement is essential for companies operating in Hong Kong who wish to expand their sales reach through external representatives without creating an employment relationship. This document is particularly relevant when businesses seek to enter new markets or expand their sales force cost-effectively through commission-based arrangements. The agreement, governed by Hong Kong law, typically includes detailed provisions on commission structures, sales territories, performance metrics, and protective clauses for intellectual property and confidential information. It's designed to comply with Hong Kong's commercial law framework while clearly establishing the independent contractor status of the representative to avoid potential employment law implications. This type of agreement is commonly used across various industries where companies prefer flexible sales force arrangements over traditional employment relationships.
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1. Parties: Identification of the company and the independent sales representative, including full legal names and addresses
2. Background: Context of the agreement, nature of the company's business, and purpose of engaging an independent sales representative
3. Definitions: Key terms used throughout the agreement, including Products, Territory, Customers, Commission, etc.
4. Appointment and Scope: Terms of appointment, exclusivity/non-exclusivity, and detailed scope of services to be provided
5. Independent Contractor Status: Clear statement of independent contractor relationship and not employment, including responsibilities for taxes and benefits
6. Term and Termination: Duration of the agreement, renewal terms, and circumstances for termination by either party
7. Compensation and Commission: Commission structure, payment terms, calculation methods, and payment schedule
8. Duties and Responsibilities: Detailed obligations of the sales representative, including sales targets, reporting requirements, and professional conduct
9. Territory and Customers: Definition of geographical territory and/or customer segments the representative is authorized to serve
10. Confidentiality: Protection of confidential information and trade secrets
11. Non-Competition and Non-Solicitation: Restrictions during and after the agreement term
12. Intellectual Property: Ownership and usage rights of company IP, including trademarks and marketing materials
13. Representations and Warranties: Commitments and guarantees made by both parties
14. Indemnification: Mutual or one-way indemnification obligations
15. General Provisions: Standard clauses including notices, amendments, governing law, etc.
1. Training and Support: Details of training and support provided by the company, used when significant product knowledge or specialized training is required
2. Marketing and Advertising: Guidelines for marketing activities and advertising approvals, included when the representative has marketing responsibilities
3. Minimum Performance Requirements: Specific sales targets and consequences for not meeting them, used when the company wants to enforce performance standards
4. Expense Reimbursement: Terms for reimbursable expenses and approval process, included when the company will cover certain expenses
5. Insurance Requirements: Specific insurance coverage requirements, included when the nature of products or services requires particular insurance
6. Data Protection: Specific obligations regarding customer data handling, included when representative will handle personal data
7. Dispute Resolution: Detailed dispute resolution procedures, included when parties want specific arbitration or mediation procedures
8. Sub-contractors: Terms for engaging sub-contractors, included when sub-contracting is permitted
1. Schedule 1 - Commission Structure: Detailed commission rates, tiers, bonuses, and calculation methods
2. Schedule 2 - Territory Definition: Detailed description of geographical boundaries or customer segments
3. Schedule 3 - Product List: List of products/services the representative is authorized to sell
4. Schedule 4 - Sales Targets: Specific sales targets and measurement periods
5. Schedule 5 - Reporting Requirements: Templates and requirements for sales reports and documentation
6. Schedule 6 - Company Policies: Relevant company policies the representative must comply with
7. Appendix A - Marketing Guidelines: Guidelines and restrictions for marketing and promotional activities
8. Appendix B - Customer Account List: List of existing customers or assigned accounts if applicable
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