Agency Law in Denmark
Implementing legislation
Law no. 272 of 2.5.1990.
Proper notice
- 1 month if less than or equal to 1 year;
- 2 months if more than 1 year and less than or equal to 2 years;
- 3 months if more than 2 years and less than or equal to 3 years;
- 4 months if more than 3 years and less than or equal to 4 years;
- 5 months if more than 4 years and less than or equal to 5 years;
- 6 months if more than 5 years.
Indemnity or compensation or both
Indemnity.
Calculation of indemnity/compensation
Capped at a maximum equal to one year of commission based on the average annual commission over the last 5 years or, if less than 5 years, over the duration of the agency.
Pre-termination commission
Yes.
Post-termination commission
Yes.
Back commission
Yes.
Other entitlements
Right to be provided with all the information, and in particular an extract from the books, which is available to the principal and which is needed to check the amount of the commission due to the agent.
Additional questions raised
1. sub-agents: how are sub-agents treated under your national law?
The use of sub-agents is not directly governed by the Danish Commercial Agents Act. Therefore, there is some uncertainty with regard to the legal position of sub-agents. However, one of the more recent Danish Supreme Court judgments regarding agents ordered an agent to pay damages to a number of sub-agents for the agent’s unjustified termination of the agency agreement. With this in mind, the provisions in the Danish Commercial Agents Act can extend to a sub-agent as well. Furthermore, it is possible to include (or exclude) the use of sub-agents in the agency agreement.
2. Retirement: is there a specific age that the agent must reach in order to retire from the agency and be able to make a claim under the provisions of your law which implement Article 18 (b) of the Agents Directive 86/653/EC?
In Denmark, Article 18 (b) of the Agents Directive 86/653/EC is implemented in Section 27(2)(b). A specific age for which it would normally be reasonable for the agent to terminate the agreement on his own initiative while maintaining the claim for indemnification has not been set. Reaching the Danish retirement age will not in itself be sufficient for the condition under Section 27(2)(b) to be met, as the “reasonableness” requirement must also be met.
3. Retirement and corporate entity: if the agency is operated by one person who has decided to form a corporate entity which is to act as the agent, and that person is the sole shareholder/owner and sole director/manager of such entity, if that person retired would any protection under Articles 18(b) and 17 of the Directive be extended to that person despite the fact that such person operates his/her agency through a corporate entity?
The Danish Commercial Agents Act seems to presuppose that the agent is a natural person. However, there is nothing preventing a legal person (e.g. a public limited company or a private limited company) from having the status of an agent. When an agent conducts business in the form of a company as a public or private limited company, certain sections of the Commercial Agents Act will lack an object for their application, e.g. Section 27(2)(b). As such it will depend on the wording of the agreement whether a sole or main shareholder will be entitled to invoke Section 27(2)(b). The same applies for Section 25(2) regarding the death of the agent.
agentlaw.co.uk wishes to thank Lundgrens for their involvement with this page. Last updated 27.01.2022.
