Agency Agreement Ireland: Commercial Agents Rules (2026)

Last updated October 2026. General information only, not legal advice.

A business that wants to sell into a new market without hiring a sales team often appoints an agent: a self-employed person or firm that finds customers and negotiates sales on its behalf in return for commission. In Ireland, many of these relationships are governed by the European Communities (Commercial Agents) Regulations 1994 and 1997, which give agents rights that a contract cannot take away. This guide explains who the rules cover, what they require, and what an agency agreement should include.

Who is a commercial agent?

The 1994 Regulations (S.I. No. 33 of 1994) apply an EU directive, Directive 86/653/EEC, to relations between commercial agents and their principals. A commercial agent is defined as a self-employed intermediary who has continuing authority to negotiate the sale or purchase of goods on behalf of another person, the principal, or to negotiate and conclude such transactions on behalf of and in the name of the principal.

Three points follow from that definition:

• Goods, not services. The Regulations cover agents dealing in goods. An agent who sells services is outside them, and the relationship is governed by the contract and general law.
• Self-employed. An employee who sells for an employer is not a commercial agent.
• Continuing authority. A one-off introduction is not enough.

Some intermediaries are expressly excluded, including company officers, partners, unpaid agents and agents operating on commodity exchanges.

Agent or distributor?

An agent negotiates or concludes sales for the principal and earns commission. The contract of sale is between the principal and the customer. A distributor buys goods and resells them on its own account, making its profit on the margin. Distributors are outside the Commercial Agents Regulations and have no statutory right to compensation or minimum notice when the relationship ends. What matters is how the arrangement actually works. The High Court has treated parties described as distributors as commercial agents where the substance fitted the definition.

The agreement must be evidenced in writing

Regulation 5 of the 1994 Regulations states that the agency contract “shall not be valid unless it is evidenced in writing”. Under the Directive, each party is also entitled to receive from the other, on request, a signed written document setting out the terms of the agreement, and that right cannot be waived. A clear written agreement is therefore the starting point for both sides.

Duties on both sides

The agent must look after the principal’s interests and act dutifully and in good faith. That includes making proper efforts to negotiate sales, passing on necessary information and following reasonable instructions. The principal must also act dutifully and in good faith. It must give the agent the documentation and information needed, warn the agent within a reasonable time if it expects business to be significantly lower than the agent could normally have expected, and tell the agent whether orders the agent has procured are accepted or refused. These duties cannot be excluded by contract.

Commission

• During the agreement. The agent earns commission on transactions concluded as a result of the agent’s action, and on repeat business with customers the agent previously won for transactions of the same kind.
• Exclusive territories. Under the Irish Regulations, an agent is entitled to commission on all sales to customers in a particular area or group only where the agent has an exclusive right to that area or group.
• After termination. Commission is still due on a transaction that is mainly attributable to the agent’s efforts and is entered into within a reasonable period after the agreement ends, or where the order arrived before termination.
• When it is paid. Commission must be paid no later than the last day of the month following the quarter in which it became due.
• Statements. The principal must give the agent a statement of commission due, showing how it was calculated, and the agent can demand the information needed to check it, including an extract from the principal’s books.

Minimum notice

Where an agency agreement is for an indefinite period, either side can end it by notice. The minimum notice is 1 month in the first year, 2 months in the second year, and 3 months in the third and later years. The parties cannot agree shorter periods. If they agree longer ones, the principal’s notice period must not be shorter than the agent’s. A fixed-term agreement that carries on after its end date becomes an indefinite one. Either side can still terminate immediately where the other has failed to carry out its obligations or in exceptional circumstances.

Compensation when the agreement ends

This is the right that most surprises principals. The 1997 Regulations (S.I. No. 31 of 1997) confirm that a commercial agent is entitled, after termination, to be compensated for the damage suffered as a result. Damage is treated as arising in particular where the termination deprives the agent of commission that proper performance of the agreement would have earned, while the principal keeps substantial benefits from the agent’s work, or where the agent has not been able to recover costs incurred on the principal’s advice.

Key points:

• The agent loses the entitlement unless the agent notifies the principal within one year of termination that a claim is intended.
• Compensation is not payable where the principal terminated because of a default by the agent that justified immediate termination, where the agent terminated without justification, or where the agent assigned the agency to someone else with the principal’s agreement. An agent who ends the agreement because of age, infirmity or illness keeps the right.
• The parties cannot contract out of these rules to the agent’s detriment before the agreement ends.
• The legislation does not set a formula or a cap, and how compensation is calculated in Ireland is not settled by reported case law.

Restrictions after termination

A clause restricting the agent’s business after the agreement ends is valid only if it is in writing, relates to the geographical area or the customers and area entrusted to the agent, and relates to the kind of goods covered by the agency. It cannot last more than two years after termination, and it must still be reasonable under general Irish law.

What to include in an agency agreement

• the products and the territory or customer group, and whether the appointment is exclusive;
• whether the agent can only negotiate or can also conclude contracts in the principal’s name;
• commission rates, when commission is earned and how statements are provided;
• each side’s duties, including reporting and marketing support;
• the term and notice periods, respecting the statutory minimums;
• confidentiality and use of the principal’s brand;
• any post-termination restriction within the limits above;
• governing law and how disputes are resolved.

Our guide to writing a business contract in Ireland covers general drafting points.

Using a template

For a standard appointment of a sales agent, a structured template helps both sides record the terms the law expects to see in writing. Our Agency Agreement is a self-complete document, and related commercial documents are in our buying and selling documents category.

If you are ending an agency, facing a compensation claim, or setting up an arrangement across several countries, speak to a solicitor. You can search the Law Society’s Find a Solicitor directory.

Frequently asked questions

What is a commercial agent under Irish law?

A commercial agent is a self-employed intermediary with continuing authority to negotiate the sale or purchase of goods on behalf of a principal, or to negotiate and conclude those transactions in the principal’s name. Agents who sell services, and employees, are not covered by the Commercial Agents Regulations.

Does an agency agreement have to be in writing in Ireland?

For commercial agents, the 1994 Regulations state that the agency contract shall not be valid unless it is evidenced in writing. Each party can also require the other to provide a signed written document setting out the terms.

How much notice is needed to terminate an agency agreement in Ireland?

For an indefinite agreement with a commercial agent, the minimum is 1 month in the first year, 2 months in the second year and 3 months in the third and later years. The parties cannot agree shorter periods.

Is a commercial agent entitled to compensation on termination in Ireland?

Yes, in most cases. The 1997 Regulations confirm that a commercial agent is entitled to compensation for damage suffered as a result of termination. The agent must notify the principal of the claim within one year, and compensation is not payable in certain cases, such as termination for the agent’s serious default.

What is the difference between an agent and a distributor?

An agent arranges sales on behalf of the principal and is paid commission, with the sale contract made between the principal and the customer. A distributor buys the goods and resells them on its own account. Distributors do not have the statutory rights that commercial agents have.

Sources: European Communities (Commercial Agents) Regulations 1994 (S.I. 33/1994); European Communities (Commercial Agents) Regulations 1997 (S.I. 31/1997); Council Directive 86/653/EEC.

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