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Russian: Агент



Agent is a person or business authorized to act on another's behalf. To understand better the dissimilarities between Agent and Principal (while these dissimilarities are considered as negligible in USA) one could use the following check-list [1] (Table 1). An agent is usually a small firm or an individual located in the importing country who acts as a manufacturer's (seller's) representative for the exporter. Therefore an agent does not take title to the goods it sells but earns a commission on the sales it makes. In its relationship with an agent, the exporter is known as the Principal. An agent often has several principals and generally sells a group of complementary products rather than products that compete directly with one another. The agent will handle all of the sales functions for the exporter, from the initial prospecting for customers to the close.

The agent is usually given varying support by the exporter: Some exporters provide only the bare minimum of a sales brochure and a price list, while the more experienced exporters provide training on the product's characteristics, analysis on the competitors' products, information on the sales and service philosophy of the company, sales support in the form of samples, catalogs (translated or adapted), trade advertising, and financial support to attend trade shows, technical visits by corporate engineers, participation in sales incentive programs, and so on [2].

Types of Agents

There are three kinds of agent which are classified by the law, the first is the universal agent. A universal agent can do most things for the principal in the principle agent relationship. The universal agent may be appointed by power of attorney. The power of attorney is the deed signed by the principal and witnessed by the principal. The donor of the power gives the the agent or the attorney the power or the authority to act on behalf of the principal. For example, the principal may be traveling or living overseas or maybe in hospital or have limited mobility. The power of attorney may be general or it may be limited to a particular area, a particular purpose such as the sale of a particular property or a period of time such as one year or until someone returns from overseas. The power of attorney can be stopped like any other agency appointment[3].

The other types of an agency type relationship include the general agent which has less power than universal agent. The general agent can make contracts and do things for the principal, this one may do things which are normal in the ordinary business of the principal. For example, the agent may be employed to manage all the principal's shops or may be employed as a traveling representative or may be employed to do an act which is within the normal scope of the agencies own business. The final type of agent is a special agent which is limited and has even more narrowly defined powers than universal and the general agent. The special agent is appointed for a specific purpose or to do something which is not within the course of the agents than usual business. For example, a real estate agent may be appointed a special agent not to sell a house but to sell furniture in the house, because selling furniture is outside the ordinary business of real estate agent. Many occupations including accountants and travel agents fit in this model[4]. Some other types of agents are presented in the Table 2 below.

Table 1. Who am I, Distributor or Agent? - Check-List

Comparative Factors I am Supplyer’s Distributor if….. I am Principal’s Agent if…..
  • I buy products for my own risk and account.
  • What, me take a risk? No way!
Attitude to Customers
  • I sell products to my customers.
  • I sell products to Principal’s customers.
  • My compensation is the difference between my buy price and my sell price.
  • My compensation is a flat commission.
Sales Amount Information
  • I don’t brag when I make lots of sales for the Supplier. Otherwise, the Supplier will start thinking: “Gee. If it’s so easy, maybe we should be there.”
  • When I make lots of sales for the Principal, I blow my own trumpet for a bonus or other incentive based compensation.
Pricing Policy
  • I set the price of the products to my customer.
  • My prices to the customer are none of Supplier’s business.
  • The Principal advises me what price to sell its products for.
  • The Principal and I consult closely about what price I should sell its products for.
Sales Policy
  • I set my own sales policies.
  • The Principal sets my sales policies.
  • I have authority to promote, market and sell Supplier’s products pretty much as I determine.
  • I promote, market and sell Principal’s products pretty much as the Principal determines. I must conform to Principal’s directions and only operate within my scope of authority.
Customer's Perception
  • The customer perceives me as the supplier.
  • The customer perceives the Principal as the supplier
Contacts wits Customers
  • I discourage the Supplier from contacting my customers. I try to keep the Supplier in the dark.
  • I have no problems if the Principal communicates directly with its customers provided the Principal doesn’t keep me in the dark.
  • If heaven forbid, the customer doesn’t pay, it’s my problem.
  • If heaven forbid, the customer doesn’t pay, it’s Principal’s problem.
Ad and Promo Costs
  • I bear my own advertising and promotional costs out of my gross profits. If I’m lucky, and the Supplier is in a generous mood, the Supplier may contribute to a trade show booth or some other cooperative promotional campaign, on an equal basis with its other distributors.
  • The Principal covers my advertising and promotional costs.
  • I have my own warehouse. The goods are mine! I bought them.
  • I may have a small warehouse. But I don’t own the goods. I hold the goods for the Principal, who pays the storage and insurance fees. The warehouse is for buffer stock only. the Principal usually ships direct to its customers.

Table 2. Main Types of Agents

General agent
  • This is an agent who has the principal’s unlimited authority to carry out contracts on behalf of the principal without recourse to the principal on each and every point in a transaction.
  • Swiss Air v Palmer [1976] 2 Lloyd’s Rep 604[5].
Agent of necessity
  • The agency comes into being as a result of circumstances. There is no formal appointment, express or otherwise. The agent steps into the agency with a view to minimize damages or loss to the goods of principal.
  • China Pacific SA v Food Corporation of India [1982][6]
Del Credere agent[7]
  • This agent undertakes to guarantee the goods or indemnify the principal for any losses arising from the agency transaction. In return for this assurance, the agent receives an extra remuneration from the principal.
  • Churchill & Sim v Goddard [1937][8]
  • The basic feature of the agent (factor type) is that this kind of agent has possession of the goods before sale. In this case, such an agent can sell in his/her own name and may even pledge the goods as security to raise money in the name of the principal.
  • A factor, from the Latin "he who does" (from Latin facit, to do, parallel to agent, from Latin agens), is a person who professionally acts as the representative of another individual or other legal entity, historically with his seat at a factory (trading post).
Special Agent
  • This is an agent who has been appointed to carry out only a designated task. On completion of the task, the agency terminates.
  • A person who has been granted limited authority by someone else to undertake a specific task.[9]
  • This is an agent who does not have possession of the goods at the time of sale. The transaction concluded by such an agent on behalf of the principal, nevertheless binds the principal.
  • A broker is an individual or party (brokerage firm) that arranges transactions between a buyer and a seller, and gets a commission when the deal is executed. A broker who also acts as a seller or as a buyer becomes a principal party to the deal. Distinguish agent: one who acts on behalf of a principal [10].
Commission agent *)[11]
  • COL - The agent whom the British exporter appoints in an overseas country may be classified by the agent's own law as a commissioner.
  • CIL - Most European continental countries and other legal systems founded on the civil law recognize concessionaires as a special class of self-employed commercial agents[12].
  • A commissionaire is a person who internally, i.e. in his relationship to his principal, is an agent but externally, i.e. in his relationship to the third party, is a seller or buyer in his own name. Where a commissioner has acted for the principal, no privity of contract can be constituted between the principal and the third party.
Direct agent
  • A direct agent is an agent who discloses his agency quality to the third party.
  • In civil law countries
Indirect agent
  • An indirect agent is a person who, though being an agent, treats with the third party in his own name. The commissioner is an indirect agent.
  • In civil law countries
Agent carrying stock (Mercantile agent)[13]
  • Agents resident abroad have either authority to solicit or accept orders and pass them on to the principal, who then dispatches the goods to the customer directly, or they are entrusted with a store or consignment of stock lines, spare parts, etc. and have authority to supply customers directly from their store.
  • In UK: Factors Act 1889 (See above)
Confirming house (Export house)[14]
  • In the export trade an overseas importer may buy through a confirming house resident in the United Kingdom, although in recent years the number of independent confirming houses has decreased, many having been absorbed by banks.
  • In modern practice these confirming houses are called export houses.
  • Case of United Kingdom
  • However, business enterprises carrying on these activities are, of course, also established in other countries, notably the United States.
Freight forwarder[15]
  • A freight forwarder, forwarder, or forwarding agent is a person or company that organizes shipments for individuals or corporations to get large orders from the manufacturer or producer to market or final point of distribution. [16] [17]
  • A forwarder is not typically a carrier, but is an expert in supply chain management. A freight forwarder is a "travel agent," for the cargo industry, or a 3p (non-asset-based) logistics provider.
  • A forwarder will contract with asset-based carriers to move cargo ranging from raw agricultural products to manufactured goods. Freight can be booked on a variety of carrier types, including ships, airplanes, trucks, and railroads. It's not unusual for a shipment to move along its route on multiple carrier types.
  • The services of freight forwarders are of great value to those engaged in the export trade, and particularly to small firms which do not possess their own export organizations and shipping department.
  • Freight forwarders have a specialized knowledge of the intricacies of carriage by sea, air and land and are, in particular, acquainted with the constantly changing Customs formalities at home and abroad, the rates and rebates of freight, the practices of sea and air ports, the groupage of sea or air cargoes in container transport and the package and handling of export goods.
  • Freight forwarders undertake on occasion the inspection of goods and the collection of debts from customers abroad.
LEGEND: CIL = Civil Law; COL = Common Law; *) Commission agent (COL) has not the same meaning as self-employed commercial agents (CIL).


  1. Auerbach, R. Am I an agent or a distributor? - -accessed 01/27/2007
  2. David, P., Stewart, R. International Logistics: The Management of International Trade Operations - Thomson: Mason, Ohio. 2007. – Sec.4-3a.
  3. Coleman, D.A. What Are the Different Types of Agents in Business? - - accessed 05/10/2012
  4. ibid
  5. - accessed 05/10/2012
  6. - - accessed 05/10/2012
  7. Schmitthoff’s Export Trade: The Law and Practice of International Trade by Murray, C., Holloway, D., Timson-Hunt, D., Sweet Maxwell, Thomson Reuter, London, 2009. - pp.708-9.
  8. - accessed 05/10/2012
  9. - accessed 05/10/2012
  10. Spiro, R.L., Stanton, W.J., Rich, G.A.. Management of a sales force . 12th ed. Boston: McGraw-Hill/Irwin, 2003
  11. Schmitthoff’s... Op.cit. - pp.709-710.
  12. The Civil Code of the Russian Federation - Russian Civil Law – Ch.49, Arts. 971-979; Ch.51, Arts.990-1004 - accessed 15/07/2011
  13. Schmitthoff’s... Op.cit. - pp.709-710.
  14. ibid - pp.710-715.
  15. ibid - pp.715-720.
  16. - accessed 05/10/2012
  17. Freight Forwarder Guidance - Bureau of Industry and Security U.S. Department of Commerce - - accessed 05/05/2012
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