Broker Agreement Commission for Malaysia

Broker Agreement Commission Template for Malaysia

A comprehensive agreement governed by Malaysian law that establishes the terms and conditions for broker commission arrangements between a principal company and a broker. This document outlines the commission structure, payment terms, service obligations, and compliance requirements in accordance with Malaysian regulations, including the Capital Markets and Services Act 2007 and Financial Services Act 2013. It provides a legally robust framework for managing broker relationships while ensuring compliance with local regulatory requirements and market practices.

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What is a Broker Agreement Commission?

The Broker Agreement Commission is a critical document used to formalize the relationship between companies and their brokers or sales intermediaries in Malaysia. It is essential for businesses engaging external parties to promote, sell, or facilitate transactions for their products or services. The agreement must comply with Malaysian legislation, including the Contracts Act 1950 and relevant industry-specific regulations. This document typically includes detailed commission structures, performance requirements, compliance obligations, and risk management provisions. It's particularly important in regulated industries where clear documentation of intermediary relationships is required by law. The agreement helps prevent disputes by clearly defining commission calculations, payment terms, and service expectations while ensuring alignment with Malaysian regulatory requirements.

What sections should be included in a Broker Agreement Commission?

1. Parties: Identification of the broker and the principal company, including registration details and addresses

2. Background: Context of the agreement and brief description of the business relationship

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

4. Appointment and Scope: Terms of broker appointment and detailed scope of authorized services

5. Broker's Obligations: Key responsibilities, service standards, and compliance requirements

6. Principal's Obligations: Support, information, and resources to be provided by the principal

7. Commission Structure: Calculation method, rates, and conditions for commission payments

8. Payment Terms: Timing, method, and currency of commission payments, including invoice requirements

9. Term and Termination: Duration of agreement and circumstances for termination

10. Confidentiality: Protection of confidential information and trade secrets

11. Regulatory Compliance: Compliance with relevant Malaysian laws and regulations

12. Limitation of Liability: Extent and limitations of parties' liabilities

13. General Provisions: Standard clauses including notices, amendments, governing law, and dispute resolution

What sections are optional to include in a Broker Agreement Commission?

1. Exclusivity: Used when the broker is granted exclusive rights for specific territories or customer segments

2. Performance Targets: Include when specific performance metrics or sales targets are required

3. Training and Support: Details of training and support programs when the principal provides extensive support

4. Marketing and Promotion: Include when the broker has specific marketing responsibilities or restrictions

5. Insurance Requirements: Detailed insurance obligations when higher risk activities are involved

6. Data Protection: Extended data protection clauses when handling sensitive customer information

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

8. Force Majeure: Include detailed force majeure provisions for high-value or critical service arrangements

What schedules should be included in a Broker Agreement Commission?

1. Schedule 1 - Commission Rates: Detailed breakdown of commission rates for different products or services

2. Schedule 2 - Territory Definition: Detailed description of geographical areas or market segments covered

3. Schedule 3 - Service Level Requirements: Specific performance metrics and service standards

4. Schedule 4 - Compliance Requirements: Detailed regulatory compliance procedures and requirements

5. Schedule 5 - Reporting Templates: Standard forms for activity reporting and commission calculations

6. Appendix A - Required Licenses: List of required regulatory licenses and certifications

7. Appendix B - Product List: Details of products or services covered by the agreement

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Malaysia

Publisher

Genie AI

Document Type

Agency Agreement

Cost

Free to use
Relevant legal definitions
Relevant Industries

Financial Services

Real Estate

Insurance

Securities Trading

Commodities

International Trade

Business Services

Investment Services

Commercial Property

Manufacturing Distribution

Relevant Teams

Legal

Compliance

Sales Operations

Finance

Business Development

Risk Management

Commercial Operations

Partner Relations

Contract Administration

Revenue Operations

Relevant Roles

Sales Director

Chief Commercial Officer

Broker Relations Manager

Compliance Officer

Legal Counsel

Business Development Manager

Commission Administrator

Sales Operations Manager

Contract Manager

Finance Manager

Risk Management Officer

Channel Partner Manager

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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