The First Thing You Should Do…

Well, after taking the survey at http://agglaw.polldaddy.com/s/irelandnisurvey that is…

The first thing you should do when considering whether to export your product to the United States is determine whether the product can be marketed or sold in the United States, or if there are license or registration requirements in connection with marketing or selling your product here.  From time to time, I have seen companies go through the time and expense of setting up operations here or take other significant steps, only to discover that their product either needs prior approval/registration to be marketed or sold in the US or can’t be imported here at all.

There is an obvious reason to think of this issue first–you don’t want to waste time, effort or money if they US market is closed to your product, or if your product needs a license/registration to be sold here.  You should take into account the time and cost of a license/registration process when building and analyzing the economic/business case for expansion to the US market. Another, perhaps less obvious, reason is timing–you want to build enough lead time for your product launch in the US to account for any licensing/registration issues. You don’t want to leap into the US market without having a properly registered/licensed product.

Many products don’t need a license or registration to be marketed and sold here. But several products do, including products in areas where Irish and Northern Irish companies do well:

  • Pharmaceuticals and medical devices require authorization from the FDA to be imported, marketed, and sold here.
  • Certain ingredients in cosmetics are not allowed in the US (some ingredients may be banned on a state-by-state basis).
  • Food and drink imports may need prior approval from the US Department of Agriculture.
  • Medicinal foods require prior approval from the FDA.
  • Certain consumer products–especially those that are used by children–may need to be reviewed by the US Consumer Products Safety Commission.

There are other products that require license/registration to be marketed and sold here.

The primary observation of this post is that you should be sure whether, and on what terms, your product may be imported, marketed, and sold in the US before you set up a affiliate, create a distribution network or take any other substantive step to expand here. It’s a small up-front expense compared to the expense of finding out later and having to correct a mistake.

 

 

The Survey Says?

The good news is that we’re going to re-start our webinar series on US legal topics for Irish and Northern Irish businesses expanding to/operating in the US. But we need your help: we’re looking for feedback on the topics that might be of interest to an audience of Irish/Northern Irish businesses, their advisors, and other interested parties. The survey is at http://agglaw.polldaddy.com/s/irelandnisurvey

Please take a moment to give us some feedback, and please feel free to forward along to your colleagues and contacts. Thank you in advance for your help.

 

No Termination Payment for You!

I was recently asked whether the US had any regulations similar to the EU’s Commercial Agent Regulations–pursuant to which, upon termination or expiration of certain agency contracts, the agent would be entitled to an indemnity/compensation payment. The specific question related to a sales agency agreement, but the answer for the US is valid for agency, distribution and similar agreements.  The short answer is ‘no,’ the general rule in the US is that there are no termination payments due upon termination of a ‘commercial agent’ (or expiration of the term of the agency agreement). Notwithstanding that answer, I’d point out two things for an Irish/NI company potentially appointing a commercial agent in the US: (i) the underlying agency agreement should be clear on intellectual property rights in that the ownership of principal’s IP remains with the principal, the agent’s use of that IP inures to the benefit of the principal, and that the agent, even after termination/expiration, will execute whatever document are reasonably necessary to reflect the principal’s ownership of its IP; and (ii) the underlying agreement should also be clear that the agent must return all confidential materials/information to the principal upon termination/expiration of the term.

 

It’s About the Process…

When Irish and Northern Irish companies ask if there is *one* thing they can or should do to minimize the risk of operating in the US, I channel my inner Mr. McGuire (from the movie The Graduate) and say ‘process.’ It’s not quite as pithy as ‘plastics,’ but it works. What I mean by that remark is this: adopting and consistently using a process for developing and executing US contracts will go a long way in terms of risk mitigation. Comprehensive, American-style contracts, and the process by which they are built, are the most powerful defenses in an Irish or Northern Irish company’s risk-avoidance arsenal. Continue reading

Webinars for Irish and Northern Irish Companies (free content, too!)

Late last year, we held a series of webinars directed to Irish and Northern Irish companies looking to do (or doing) business in the US. The webinars were well-attended, and, in part, led to the creation of this blog. We want to share those webinars, and their content, with you.

The first webinar introduced the concept of ‘smart exporting’ and provided a high-level view of some key legal issues relevant to Irish and Northern Irish companies in the US market. The presentation for this ‘smart exporting’ webinar can be found here; the recording of the webinar (requires registration) can be found here.

Continue reading

Practical Due Diligence on Distributors–it is possible!

If your company is thinking about expanding into the US market, chances are that you’ve considered a distribution arrangement (or something similar) with a US person or entity. You may even have been inundated with offers from ‘eager’ third parties to be your distributor, agent, etc. One frequent question is how can an Irish/NI company gather and analyze enough information about a third party to make a good decision about whether to engage with that person/company. Continue reading