By the lawyer. Alberto Venezia
1. Introduction and exclusive right
Among the interpretative issues frequently subject to dispute in the agency contract is the issue of deals concluded by the principal in the area or with the clientele assigned to the agent, but without the direct intervention of the latter. The issue of the agent’s right to commission falls within this context, and is closely connected to the existence or otherwise of an exclusive right in favor of the agent.
Exclusivity governed by art. 1743 of the Italian Civil Code, which generally provides for a perfect bilateral exclusivity, that is, the agent’s right to commission on all transactions concluded in any way within the area assigned to him, with the prohibition for the principal to appoint other agents in the area and the obligation for the agent not to take on assignments for competing products. The right of exclusivity, which constitutes a natural element of the agency contract, can however be freely derogated by the parties who can therefore agree as they see fit in the single individual contract, even by expanding (usually at the agent’s expense) the limits of the exclusivity’s operation.
Article 1748, paragraphs 1 and 2 of the Italian Civil Code, in line with the derogability of the exclusive right, in regulating the right to commissions, establishes that:
For all transactions concluded during the contract, the agent is entitled to a commission when the transaction is concluded as a result of his or her intervention. The commission is also due for transactions concluded by the principal with third parties whom the agent had previously acquired as clients for transactions of the same type or belonging to the area or category or group of clients reserved for the agent, unless otherwise agreed.
The agent is also entitled to commission for business concluded directly by the principal with third parties whom he had already acquired as clients for business of the same type or who had been contacted by the agent first.”
The rationale behind the provision lies in the need to protect the agent’s preparatory work, preventing the principal from surreptitiously concluding contracts by “bypassing” the agent’s intermediation and depriving him of the related commission. However, it is possible to contractually provide for different criteria for assigning the commission, perhaps excluding it for direct deals concluded in the area by the principal. In the absence of any agreement to the contrary, the general criterion applies which awards the agent commission on all transactions concluded with customers or in the area assigned to him.
2. Definition of “business concluded directly by the principal”
The classic case is when the principal closes a contract directly with a customer located in the agent’s area or belonging to the agent’s portfolio, without any intervention by the latter in the specific transaction.
It is irrelevant whether the principal acts independently or through another party: what is relevant is the client’s objective membership in the portfolio or area assigned to the agent.
3. When is the agent’s commission due?
The right to commission may arise in two distinct cases:
a) Clienti già acquisiti dall’agente per affari dello stesso tipo
Here the agent has already handled previous business with that client: it is therefore assumed that the direct conclusion by the principal is the result of a commercial relationship generated (or fueled) by the agent’s activity.
b) Customers contacted first by the agent
Anche in assenza di affari precedenti, se il cliente è stato avvicinato per primo dall’agente, e se l’affare concluso è del medesimo tipo di quello promosso dall’agente, l’agente dovrebbe avere comunque diritto alla provvigione. This mechanism protects the agent’s market prospecting activity, which constitutes an essential component of its function.
There then remains the delicate issue related to the existence of possible contractual agreements to the contrary.
4. The agent’s role in concluding the deal and the burden of proof
If the agent did not have a direct role in the individual negotiation, but the contract was nevertheless concluded within his area or within the client portfolio assigned to him, the question arises of whether the agent is entitled to the commission even though he did not actually facilitate the deal.
The answer is generally affirmative if the objective conditions set forth in Article 1748, paragraph 2, are met: no specific causal contribution from the agent to the transaction is required, but only a territorial or relational connection (client or assigned area) and a correlation between the concluded transaction and the type of activity carried out.
However, if the principal does not recognize the commission, the agent will be responsible for proving the successful conclusion of the transaction as well as its regular execution with payment by the client. The commission accrual criteria have also changed following the amendment made to art. 1748 c.c. dal D.ls. 65/99, but it is still possible to make the due date of the commission coincide with the actual payment by the client provided that this is expressly provided for in the contract in derogation from the general principle connected with the execution of the service by the principal.
5. The contrary agreement: is it valid?
The Civil Code allows, pursuant to art. 1748 of the Civil Code, the possibility for the parties to stipulate a contrary agreement, thus excluding commission for transactions concluded directly by the principal in the area or with clients entrusted to the agent.
However, this clause cannot completely cancel the agent’s right, especially if the business derives from customers procured or cultivated by the agent himself. In such cases, case law tends to rigorously evaluate the validity of the agreement, in light of the principle of good faith and the protection of the work performed.
6. Conclusions
The issue of business concluded directly by the principal in the area or with assigned clients is certainly a sensitive one within the framework of agency contracts, where the agent’s financial interest in compensation for the work performed is balanced against the principal’s right to contractual freedom.
The legislator, with art. Article 1748, paragraph 2, introduced concrete protection for the agent, extending the right to commission beyond the concept of direct promotion, unless otherwise agreed.
Careful drafting of the contract, a clear delimitation of the area/client base, and transparent management of information flows between agent and principal are essential tools for preventing disputes and ensuring a correct contractual balance.”
