Pennsylvania Act 1998-173 — COMMERCE AND TRADE - AMEND

Act text

COMMERCE AND TRADE - AMEND
                 Act of Dec. 21, 1998, P.L. 1305, No. 173             Cl. 12
                             Session of 1998
                               No. 1998-173

     HB 2703

                                  AN ACT

     Amending the act of December 21, 1988 (P.L.1881, No.184),
        entitled "An act providing for agreements between sales
        representatives and their principals," further defining
        "principal"; and further providing for commissions.

        The General Assembly of the Commonwealth of Pennsylvania
     hereby enacts as follows:

        Section 1.  The definition of "principal" in section 1 of the
     act of December 21, 1988 (P.L.1881, No.184), entitled "An act
     providing for agreements between sales representatives and their
     principals," is amended to read:
      Section 1.  Definitions.
        The following words and phrases when used in this act shall
     have the meanings given to them in this section unless the
     context clearly indicates otherwise:
        * * *
        "Principal."  Any person who [does not have a permanent or
     fixed place of business in this Commonwealth and who] does all
     of the following:
            (1)  Engages in the business of manufacturing, producing,
        importing or distributing a product for sale to customers who
        purchase such products for resale.
            (2)  Utilizes sales representatives to solicit orders for
        such product.
            (3)  Compensates sales representatives, in whole or in
        part, by commission.
        * * *
        Section 2.  Sections 3 and 4 of the act are amended to read:
      Section 3.  Termination.
        [If a contract between a sales representative and a principal
     is terminated, the principal shall, within 14 days after payment
     would have been due under the contract if the contract had not
     been terminated, pay to the sales representative all commissions
     accrued under the contract.] A principal shall pay a sales
     representative all commission due at the time of termination
     within 14 days after termination.
      Section 4.  Commissions on goods delivered after the end of the
                    agreement.
        [Within 14 days after payment would have been due under the
     contract if the contract had not been terminated, a sales
     representative shall also receive commissions on goods ordered
     prior to termination, but shipped thereafter.] A principal shall
     pay a sales representative all commissions that become due after
     termination within 14 days of the date such commissions become
     due.
        Section 3.  The act is amended by adding a section to read:
      Section 5.1.  When commissions become due.
        (a)  Contract.--The terms of the contract, whether or not in
     writing, between the principal and sales representative shall
     determine when commissions become due.
        (b)  Custom and usage.--If the time when commissions become
     due cannot be determined by a contract between the principal and
     sales representative, the past practices of the parties shall
     control, or, if there are no past practices, the custom and
     usage prevalent in this Commonwealth for the business that is
     the subject of the relationship between the parties shall
     control.
        Section 4.  This act shall take effect January 1, 1999.

     APPROVED--The 21st day of December, A. D. 1998.

     THOMAS J. RIDGE