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Is there a way to re-sell products in another country?

Cleveland, OH |

Here is the situation. We are online supplement store. I want to sell particular brand lets say MuscleTech in my country(India). But MuscleTech has already a distributor assigned for whole India (and that distributor sucks). I never get deliveries on time and having trouble ordering price quotes are very high and fluctuating. My question is:
Can i become distributor of MuscleTech in USA start selling here and sending part of my own shipment to Indian and start selling there also? Can i do this legally? Is there any way around to do this? Also can i hire an attorney to get me a deal with manufacturer? As i called them and they said they have distributor already and cant do anything about it.

Attorney Answers 4

Posted

Hi,

Your question is not so straight forward. For example, the Indian distributor may be able to enforce their rights if you attempted to import the product there. I will make an educated guess that any agreement allowing any right to distrubute this product in the US will not allow you to compete in other geographic areas and with other licensed distributors. So without express written permission, this is a very bad idea on its face.

Of course, you are free to negotiate something with the manufactorer but a lot depends on the agreements they already have in set in place.

I think discussing your objectives with counsel is a smart idea, because a lawyer will help evaluate all your options.

All the best,
Frank
Natoli-Lapin, LLC
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Posted

You need to have a distributorship agreement in place. For this you need to work with local counsel. From what you have said, it is very much likely that you will going to breach a distributor agreement already in place in India. However, producers tend to love multiple distributors, so you need to verify whether there is exclusivity. To respond to your question: 'Can i become distributor of MuscleTech in USA start selling here and sending part of my own shipment to Indian and start selling there also?' You can't get around an agreement. Having the authority to sell here does not give you automatically the authority to sell in India, unless your contract provides otherwise. And as for "Can i do this legally?" You need to work with an international attorney and local counsel in India. And as per 'Is there any way around to do this? ' answer is no. And 'Also can i hire an attorney to get me a deal with manufacturer?' Yes, there are plenty here on Avvo specialized in International transactions. Good luck.

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Posted

I agree with the previous posts. The general answer is you cannot get around an established exclusive distributorship agreement. That is why they are in place. The scenario that you mention is common. Many exclusive distributorship agreement have volume and service conditions to be met. Please contact a competent attorney that deals with international transactions.

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Posted

If it were that easy to work around contracts for exclusive distribution, these contracts would not be worth much.

That said, you might be able to structure your transactions that would (a) work around the contract, or (b) reduce your risk if you violate the contract. Of course, this will most likely be a matter of local law in India, for which you'll need good counsel in India.

We have legal contacts in India if you are interested.

Total Mobility Law is an international law firm that lets companies do global business with the knowledge and confidence they need to comply in any country. Our answers on this site do not constitute legal advice, nor do they establish an attorney-client relationship. The only thing that can do that is a signed Engagement Letter and Fee Agreement, which you can get by contacting us through www.totalmobilitylaw.com.

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