The Fiji Times, 09 June 2018 – WHAT is the difference between buying and selling commissions?
In legal terms, in an agency relationship, one party is called the agent and the other party, the principal.
An agent is a person who performs actions on behalf of the principal. The fees the agent receives for its services are called commissions.
Typically, the commission is equal to an agreed percentage of the price of the goods. In a buying agency, the principal is the buyer and in a selling agency, the principal is the seller.
Buying commissions are fees paid to a bona fide buying agent for the services it performs on behalf of the buyer in connection with the purchase of the imported goods.
Selling commissions are fees paid to a selling agent for the services it performs on behalf of the seller in the sale of the imported goods.
It is important to note that when the intermediary is acting as an agent, it is not the actual buyer or the actual seller of the imported goods but rather, a third party who is performing services on behalf of either the buyer or the seller.
How are buying and selling commissions treated under the CTA, (Customs Tariff ACT, 1986)?
Selling commissions incurred by the buyer with respect to the imported merchandise are one of the specified additions to the price actually paid or payable.
An addition is to be made for such selling commissions unless they are already included in the price.
(For example, if the seller pays its agent a commission and includes this amount in the price it charges the buyer for the imported goods, no addition is made for the selling commission since it is already included in the price). Read more…
