An exclusive distribution agreement may be unilaterally terminated by a due prior notice without describing the grounds for the termination

A Spanish manufacture and an Israeli distributor signed a short agreement that did not set any contract period and was terminated by the manufacturer after six years by a short message announcing that the agreement will be terminated in 6 months due to dissatisfaction with the distributor.
The Court rejected the distributor's claim. Exclusive distribution agreements, which are not time-limited, may be terminated at any time by either party, provided that the counterparty has been notified of this reasonable time in advance. Termination of the agreement does not required provision of a reason for the termination. The purpose of the advance notice period is not to realize the fruits of the long-established distribution system, but to provide a preparation period only and here the manufacturer gave six months advance notice that is sufficient under the circumstances.