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The Agent Commission Agreement is a crucial document for businesses operating in India that rely on external agents or representatives to sell their products or services. This agreement type is commonly used when a company (the principal) wishes to expand its market reach through independent sales agents without establishing direct employment relationships. The document comprehensively covers commission structures, sales territories, performance metrics, and compliance with Indian legal requirements including the Indian Contract Act, 1872, and relevant tax regulations. It's particularly important in the Indian context where business relationships often operate through extensive agent networks, and proper documentation is essential for tax compliance and dispute prevention. The agreement should be carefully drafted to address specific industry requirements, GST implications, and TDS (Tax Deducted at Source) obligations while ensuring clarity in commission calculations and payment terms.

1. Parties: Identification of the Principal and Agent with complete legal names and addresses

2. Background: Context of the agreement, business relationship, and purpose of appointment

3. Definitions: Key terms used throughout the agreement including 'Commission', 'Territory', 'Products/Services', 'Customers'

4. Appointment and Scope: Terms of agent appointment, exclusivity/non-exclusivity, and territorial scope

5. Duration and Termination: Term of agreement, renewal provisions, and termination conditions

6. Agent's Rights and Obligations: Detailed responsibilities, performance standards, and authorized activities

7. Principal's Rights and Obligations: Support to be provided, information sharing, and principal's commitments

8. Commission Structure: Calculation method, payment terms, and conditions for commission earning

9. Payment Terms: Timeline for payments, currency, payment method, and treatment of taxes

10. Confidentiality: Protection of confidential information and trade secrets

11. Non-Competition: Restrictions on competing activities during and after the agreement

12. Intellectual Property: Usage rights of trademarks, logos, and other IP

13. Indemnification: Mutual indemnification obligations and liability limitations

14. Dispute Resolution: Process for resolving disputes, applicable law, and jurisdiction

15. General Provisions: Standard boilerplate clauses including notices, amendments, and severability