Commission agent


The commission agent is a person (natural or legal) in charge of managing a commercial activity on behalf of another agent. This, in exchange for a commission.

In other words, a broker sells on behalf of another person, charging a commission for it. This consideration is usually calculated as a percentage of the amount actually collected from the transaction amount.

The actions of the commission agent are governed by a commercial commission contract, which specifies the specific order to be carried out, as well as the commission.

It may be, for example, that the commission agent is in charge of the business operations of a Chinese exporting company in a specific foreign territory. Thus, the intermediary offers the products of the Asian firm to potential importers under the conditions of sale that the seller has arranged.

It should be noted that the agent's counterpart is the principal. He agrees to pay the respective commission. Likewise, it must cover the necessary expenses of the commercial operation.

The principal can also revoke the contract at any time. However, it must comply with the steps that the commission agent has agreed to before the suspension.

Commissioner functions

Among the functions of the commission agent, the following stand out:

  • You must manage the commercial activity according to the orders of the principal.
  • In case freedom to act has been agreed for the commission agent, he must protect the business as if it were his own.
  • It must render accounts of its management to the client.
  • You can contract on behalf of the client or using your own. In the latter case, you will be legally responsible for responding with whoever you hire.
  • You cannot delegate the order received, unless otherwise agreed with the client.
  • You cannot divert funds for purposes other than those agreed.
  • Communicate to the client facts that may be affecting your business.

Difference between commission agent and agent

The main difference between commission agent and agent is that the former usually receives a payment for an occasional job. Instead, the agent contract establishes a relationship that will be continued over time.

In other words, the commission agent may carry out eventual business on behalf of (or on behalf of) the principal. Instead, the agent performs stable work.

Likewise, the commission agent usually acts under specific mandates. Meanwhile, the agent's activity is more varied and can carry out various types of transactions.

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