Channels of distribution, which industrial products flow from point of manufacturers to point of use, are basic to an industrial economy. These distribution networks are independent enterprises but still held together by contractual arrangements, information understandings and mutual expectations. Based on the concept of Indonesian law, distributor is a legal relation between principal (brand owner) and a national company in term of appointment to sell or distribute certain industrial goods. It can be interpreted that distributor institution in Indonesia - as independent institution - works on its initiative and willingness with its own account legal consequence. Distributor's relation with principal is a relation built by service mechanism excluding selling. Distributor has responsibility on the property rights on commodities sold, as in general distributor has bought the commodities ftora the principal. Distributor agreement is not arranged in the Indonesian regulation. Therefore, it is needed to conduct research and analysis to fined out solution. In the thesis, the writer found that this transaction is legal according to the Indonesian Civil Law Regulation (KUHP). The reason is, this regulation has already arranged in principle of freedom of contract (Laissez Faire), principle of consensus and principle of good faith