At the end of last year for the first time the Supreme Court ruled about the calculation of customer fees, also called ‘Goodwill fee’, of which the regulation is laid down in Section 7:442 of the Dutch Civil Code (BW), which as such is based on the European (agency) directive (86/653/EC). The relevant directive establishes a uniform regulation for the protection of the agent in relationship to the instructing party (principal).

Provisions in section 7:442 of the Dutch Civil Code (BW) include: “irrespective of the right to claim compensation, at the end of the agency agreement the commercial agent is entitled to a fee, customer fees, in so far as: (a.) he has brought in new customers for the principal or has substantially expanded the agreements with existing clients and the agreements with these clients will yet provide the principal with substantial benefits, and (b.) the payment of this fee is fair, in view of all circumstances, in particular of the lost commission from the agreements with these clients.”, and par. 2. of that section provides: “The amount of the fee is not higher than that of the remuneration of one year, calculated on the average of the last five years or, if the agreement period was shorter, on the average of the entire agreement period.”

With reference to a European Committee report, which for the purpose of clarifying the regulation refers in particular to the regulation in force in Germany (Section 89b HGB) and the case law of the (lower) courts there and with reference to the case law of the HvJEU (Turgay Semen/Deutsche Tamoi) the Supreme Court confirms that in determining customer fees the following procedure should be followed.

Determining the customer fees has three stages. In the first stage the benefits gained by the principal from transactions with clients brought in by the commercial agent must be quantified (section 7:442 par. 1, under a, of the Dutch Civil Code (BW). In the second stage it must be assessed whether there is reason to adjust the amount so determined for the sake of fairness, in view of all circumstances of the case and in particular in view of the commercial agent’s lost commission; fairness could involve both an increase and a decrease of the amount determined in the first stage (Section 7:442 par 1 under b, of the Dutch Civil Code (BW)). Finally, in the third stage a check is made whether the amount determined by the two previous stages does not exceed the maximum amount as referred to in par. 2 of Section 7: 442 of the Dutch Civil Code (BW) (remuneration of one year, see above).

An interesting fact is that it is established that the remuneration necessary for the calculation of the maximum fee is a broad concept which should be regarded as a ‘gross remuneration’. These include fees commonly used for canvassing clients with the aid of a gift or customer benefits. However, reimbursements of actual costs incurred by the agent and as such charged to the principal (for example, relevant advertising costs) are not included in this broad concept.

The Supreme Court stipulates also that as a result of a uniform explanation of the regulation the principal’s benefits are determined on the basis of the gross commission with regard to new and intensified existing clients earned by the commercial agent in the past twelve months (preceding the termination of the agency agreement), which amount is then adjusted by factors relating to (a) the length of time the principal is expected to benefit from transactions with said clients, (b) variation in the client base, (c) the accelerated receipt of commission income by the agent whose fee was paid out as a lump sum. This calculation method of the principal’s benefits is largely based on the method developed in Germany for calculating customer fees on the basis of the so called ‘Rohausgleich’.

Click here for the full judgment.