COMMISSIONS & KICKBACKS It is a standard practice worldwide for Manufacturers (Sellers) of one country to seek help of Agents / Brokers / Lobbyists in other countries to promote and help sell their products abroad. And it does not take a Peter Drucker to tell us that these Sellers’ prices always include a cut for their ‘man-Friday’ (Agent/Broker/Lobbyst) in the Buyer’s country, and paid when a deal goes through. This is called a Facilitation Fee or COMMISSION. It is legal. The devil, however, lies in the Agent’s work, i.e. Facilitation. There have been instances when facilitation by Agents/Brokers/Lobbyists involved inducement in kind, or promise of cash to anybody in the decision-making body representing the Buyer, or directly to the Buyer himself. If such a transaction occurs and it results in a purchase order for the Manufacturer (Seller), it can be termed as a KICKBACK. This is morally wrong and illegal. However, there are instances when The Manufacturer (Seller) awards his Agent/Broker/Lobbyist for the order received, not knowing that a part of his Commission is shared by the Buyer or by anyone associated with the Buyer. In such a case, the Manufacturer (Seller) is absolved from any wrongdoing, only the beneficiary of the share in the Agent’s/Broker’s/Lobbyist’s Commision is not, and thus invites punishment. In the unlikeliest event of money exchanging hands directly from the Manufacturer (Seller) and the Buyer or his associate/s, it amounts to a KICKBACK of the first order and is downright condemnable. Both parties in the transaction stand on the wrong side of the law. It is common practice in India not to distinguish between a COMMISSION and a KICKBACK. They should learn how to, then proceed prosecuting, accordingly. Bennet Paes Assolna, Goa
