Distribution Contracts: The Paradise For Forum And Applicable Law Shopping

Originally published August 2005

Distribution contracts fall outside the categories of contracts specifically defined by the Italian Civil Code: there is no legal definition or specific regulation of distribution to be found in other statutes, as is the case in most countries.

Scholars and case law have construed the relevant regime applicable to distribution contracts governed by Italian law by reference to the general principles appropriate to contractual obligations, as well as to the statutory rules suitable to contracts of a similar nature.

This is why, whenever a dispute arises and the parties have not determined the competent jurisdiction and/or applicable law, the competent forum remains uncertain and conflicting arguments are invariably put before the court or the arbitrators, who must establish the substantive law governing the contractual relationship concerned.