No specific legislation regulates the agent-principal relationship. Thus, entering a successful partnership or representational arrangement can be an extremely difficult task in Guinea's newly developing private sector. Because transparency in the judicial system is still in the early stages of development, U.S. businesspersons should exercise extreme caution when entering contract arrangements locally. Local representatives or distributors should be well-known individuals, and contractural arrangements designed to minimize risk to the exporter.
In appointing an exclusive representative in Guinea, the U.S. exporter is legally entitled to certain exemptions from U.S. anti-trust laws. The Webb-Pomerene Act allows a limited exemption from anti-trust laws for direct exports by allowing exporters to agree on prices, sales terms, territorial division, and other activities in export trade prohibited in U.S. domestic commerce.
Consumer goods requiring maintenance of stocks and industrial equipment and building supplies are often exported to Guinea through established wholesalers appointed as distributors. The prospective distributing company buys in its name; it is wise for the U.S. manufacturer to establish a credit pattern so that flexible or convenient payment terms can be offered.
Another method of representation for an American firm in Guinea is to establish a branch office or sales subsidiary. This method is particularly useful where a large continuing market exists for a particular product and where frequent contacts with the government are required. If the size of the market for a particular product would make establishing a branch office financially inappropriate, the American exporter might consider organizing a group of firms selling complimentary items to establish a joint-owned sales subsidiary.
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