A distribution agreement governs the relationship between a producing company and its sole distributor. With respect to the investigation period, an owner enters into a distribution agreement with distribution agents to make his property accessible and available on the market. There are a large number of distribution agreements ranging from simple licensing agreements to a comprehensive licensing, manufacturing and distribution agreement. For different types of intellectual property, the agreement would require a different strategy to protect it, which would also be different in terms of the territory of the agreement. Because a distribution/licence agreement reflects the amount a distributor/buyer is willing to pay to use and benefit from an owner`s trademark, the trademark holder, if used correctly through licensed licenses, may use these licenses under licence in any potential evaluation of the mark with subsequent resellers and even brand buyers. Thus, when entering into a distribution agreement, a trademark holder should ensure that any good-in created by the distributor during the term of the distribution contract benefits the owner and that the owner actively participates in the marketing and advertising of branded items that are the subject of the agreement. Similarly, when the contract is terminated, the trademark holder should ensure that all rights and goods related to the trademark are returned to the owner during the distribution relationship. A successful distribution agreement depends on an ongoing and productive relationship with the producer. At the same time, a distributor who has not carefully planned the development of the product or who does not have adequate implementation in his contract will have a clear disadvantage if he tries to protect his investment. The precise terms of a distribution/licensing agreement differ depending on the parties and the context. Regardless of the circumstances, it is always advantageous for a trademark holder to take into account at an early stage the issues addressed in this article in negotiations with a potential distributor, in order to better manage its own trademark rights and increase the value of those trademarks. In the case of distribution agreements in which the product is granted for manufacture and distribution to the distributor, it becomes extremely necessary to provide in the agreement whether and to what extent the distributor can make improvements, and who would own the rights to those improvements.
This is also important, as traders can often provide valuable feedback based on market needs and would mean that it could make improvements to the creation of new intellectual property rights, the treatment of which must be defined in the agreement.