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Exclusive Dealings

Exclusive Rights


Frequently, distributors, wholesalers, sales representatives and others in the product distribution chain will request an "exclusive" territory or "exclusive distributorship" from a manufacturer or supplier. In this type of arrangement, the manufacturer or seller agrees not to appoint or sell to another dealer in the same area. This greatly assists the distributor or sales representative because it need not then worry about competition in the sale of the same products.

Exclusive Distributorships

In Hong Kong, the grant of an exclusive distributorship is generally permissible. Although these arrangements could result in a "refusal to deal" by the manufacturer with other distributors, they are not prohibited by the laws as Hong Kong does not have any anti-trust or anti-competition legislations. The Consumer Council has been strongly advocating to outlaw certain restrictive trade practices but the Hong Kong Government is not responsive on that; nor the business enterprises in Hong Kong would like to witness that to happen.