Lost Commissions and Commercial Agents’ Compensation for Acquired Customers

31 May 2023 - Vanessa Guzek

In a recent preliminary ruling sought by the Czech Supreme Court, the CJEU commented on the definition of “lost commissions” after the termination of an agency contract for the purpose of the compensation for acquired customers.

The Czech courts dismissed the claim of a commercial agent on the grounds that although he had acquired new customers and done business with existing customers, it was not equitable to award him compensation for said acquired customers because the so-called “lost commissions” had already been received in the form of “one-off commissions” agreed in return for the commercial agent’s services.

The CJEU stated in its decision that the calculation of the lost commissions had to take any commissions into account “which the commercial agent would have received in the event of a hypothetical continuation of the agency contract, in respect of transactions which would have been concluded after the termination of that agency contract with new customers which he or she transferred to the principal before that termination, or with customers with whom he or she significantly increased the volume of business before that termination.”

The compensation is therefore intended to include a compensation for future transactions or the “lost commissions” resulting from them, because the compensation is based on the advantages which continue to exist for the principal. Furthermore, the CJEU distinguishes between “lost commissions” and “due commissions” for transactions that have already been concluded at the end of the agency contract. The entitlement to due commissions arises from Articles 7 and 8 of Directive 86/653, while “lost commissions”, according to this recent decision of the CJEU, must be included in the calculation of the compensation.

Moreover, the CJEU further elaborated that the commission lost by the commercial agent was only one of several factors to be taken into account when assessing the fairness of the compensation. Accordingly, choosing a certain type of commission, such as one-off commissions, could not call into question the right to compensation provided for in this provision. Otherwise, there would be a risk of circumventing the mandatory right to compensation.

It remains to be seen how this relevant CJEU decision will affect Spanish case law on compensation claims.