international lawyerA startup U.S. consumer product company with an ultra-hot new product line wrote one of my law firm’s international lawyers asking what they needed to do to sell their product through a Chinese company that had expressed interest in being the U.S. company’s “China representative.” After a few emails on various different legal subjects, our international lawyer wrote the following email (modified a bit) that provides such good and basic business advice that I wanted to share it here. It deals with the basics on what to do when you are approached by a foreign company wanting to sell your products in another country.

I am now about to provide you with some business advice, not legal advice.

You are going to get many companies from foreign countries that are interested in selling your products. Most of those companies will not be worth more than ten minutes of your time, either because they are not equipped to do what you do or because their countries are too risky/too small.  Going international can be a great thing but it should be done in a way that suits your business and your plans and not according to who just happens to contact you. I do not purport to be an expert on your product, but I would say that for a company like yours, Mexico, Canada and the EU make the most sense, simply because they are relatively easy, relatively safe, and relatively large. I doubt any one company in any one country has sufficient contacts to sell within the entire EU, so you probably will need to tackle EU sales country by country or at least region by region.

If I were in your shoes I would do the following first:

1. Figure out where selling your product makes sense.

2. Figure out whether those who have contacted you from the countries/regions that make sense are the right people/companies to be selling your products.

3. One of the most important things you need to do if you are going to be going international is to protect your brand name in those countries where your product will be sold. When you decide where it makes sense to sell your products, you should apply for a trademark in those countries. Note that you can get one trademark for the entire EU and that usually (but not always) makes sense.

4. As far as you needing an NNN Agreement before you show your products to potential distributers, that will depend on your exact situation. If you are going to send product samples to companies that could not just buy them somewhere else (to copy), then you should have a signed NNN Agreement in place before you do so. But if those products are already readily available, an NNN Agreement probably will not help you much if at all. If you are going to be discussing anything with these potential distributors that you wish to keep secret (who manufactures your products or your costs, for instance), you should have a signed NNN Agreement in place before you do so. But the safest protection would be for you not to provide samples until you absolutely must do so. You at least want to make sure you have some idea of with whom you are dealing before you reveal much of anything, NNN or no NNN.

The big question is going to be how you will want your relationship with these companies to be structured. Will you want them to be your distributor such that you have a contract with them? See this for what distribution contracts often involve. Or do you just want a situation where you sell to these companies at a reduced price, along with an agreement making clear they are not allowed to re-sell anywhere other than in their own country? We should discuss the pros and cons of these (and other) methods.

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Dan Harris

I am a founder of Harris Bricken, an international law firm with lawyers in Los Angeles, Portland, San Francisco, Seattle, China and Spain.

I mostly represent companies doing business in emerging market countries. It has taken me many years to build my network and it takes constant communication and travel to maintain it. My work has been as varied as securing the release of two improperly held helicopters in Papua New Guinea, setting up a legal framework to move slag from Canada to Poland’s interior, overseeing hundreds of litigation and arbitration matters in Korea, helping someone avoid terrorism charges in Japan, and seizing fish product in China to collect on a debt.

I was named as one of only three Washington State Amazing Lawyers in International Law, I am AV rated by Martindale-Hubbell Law Directory (its highest rating), I am rated 10.0 by AVVO.com (its highest rating), and I am a SuperLawyer.

I am a frequent writer and public speaker on doing business in Asia and I constantly travel between the United States and Asia. I most commonly speak on China law issues and I am the lead writer of the award winning China Law Blog (www.chinalawblog.com). Forbes Magazine, Fortune Magazine, the Wall Street Journal, Investors Business Daily, Business Week, The National Law Journal, The Washington Post, The ABA Journal, The Economist, Newsweek, NPR, The New York Times and Inside Counsel have all interviewed me regarding various aspects of my international law practice.

I am licensed in Washington, Illinois, and Alaska.

In tandem with the international law team at my firm, I focus on setting up/registering companies overseas (via WFOEs, Rep Offices or Joint Ventures), drafting international contracts (NDAs, OEM Agreements, licensing, distribution, etc.), protecting IP (trademarks, trade secrets, copyrights and patents), and overseeing M&A transactions.