The draft act inserting Book X in the Code of Economic Law modifies some points of the Act on Precontractual Information. The most important change concerns the broadening of its scope of application. Among other things, this brings to an end the discussion as to whether commercial agency contracts are covered.
With the draft act inserting Book X "Commercial agency contracts, Commercial partnership agreements and Sales concessions" in the Code of Economic Law, the Government intends to replace the Commercial Agency Act, the Act on Precontractual Information and the Sales Concession Act. The draft act was presented to the Chamber on 9 January 2014 and accepted 21 February 2014. The text has been passed to the Senate, which has the possibility to evoke the draft act.
The draft act adopts the stipulations of the Commercial Agency Act and the Sales Concession Act without any amendment. The Act on Precontractual Information, however, is amended in several respects, in order to make it "juridically more effective and better adapted to the realities of economic life, and to simplify its application as much as possible".
The most important change concerns the broadening of the scope of application of the Act on Precontractual Information, which currently refers to a "contract between two persons". Among legal scholars, this criterion gave rise to discussion as to whether contracts with more than two persons also fall within the scope of the Act. The draft act ends this discussion and proposes to change the word "two" to "several".
The second modification concerns the deletion of the requirement for compensation in order for a commercial partnership agreement to fall within the scope of the Act. This condition entails that the party receiving the commercial formula pays compensation of some kind, directly or indirectly. According to the explanatory memorandum accompanying the draft act, this condition leads to the exclusion of certain forms of commercial partnership agreements from the scope of application. Therefore the draft act removes this condition.
The third modification concerns the requirement "to work in their own name and for their own account". The interpretation of this condition has also been the subject of discussion. Some authors consider that this condition has to be met not only during the precontractual phase but also after conclusion of the contract. The Brussels Court of Appeal took the same view in a decision dated 4 October 2012. As a consequence, commercial agency contracts would be excluded from the scope of application, since agents do not work in their own name and for their own account, but in the name and for the account of their principal. Other commentators, however, consider that this condition is fulfilled when parties act in their own name and for their own account during the precontractual phase. In this view, agents are not excluded ipso facto from the scope of the Act. The Government has now opted for the latter, broader interpretation and proposes to delete the words "in their own name and for their own account".
In all aspects of the broadening of the scope of application, banking and insurance agency contracts are explicitly excluded from the scope. The Council of State questions whether this distinction is compatible with the principle of non-discrimination.
Besides the modifications to the scope of application, the draft act also provides for a derogation from the principal prohibition on asking for compensation before the time for reflection has passed. The draft act now allows the contracting of an obligation of confidentiality, along with the possibility of claiming damages.
The draft act also specifies the procedure to be followed when an existing contract is changed or renewed. The question arises whether all the formalities must be complied with again in that situation. The Government has opted for an in-between solution and enumerates the cases in which a simplified precontractual document can be used. Furthermore, the existing criteria for nullity of the contract are unchanged. However, the draft act also provides for a sanction for failure to include relevant data or the inclusion of inaccurate data in cases where the contract or clause is not automatically void under the Act. In these situations, the judge can determine whether this constitutes an absence of contractual consensus or a precontractual fault.
The date of entry into force will be determined by the King. The (amended) Act on Precontractual Information will – logically – not be applicable to commercial partnership agreements which were already in force before that date.