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Broker To Broker Commission Agreement for Malta

Broker To Broker Commission Agreement Template for Malta

A comprehensive legal agreement governed by Maltese law that establishes the terms and conditions for commission sharing arrangements between two or more licensed brokers. This document, compliant with Malta Financial Services Authority (MFSA) regulations and EU directives, outlines commission structures, payment terms, regulatory compliance requirements, and operational procedures. It includes specific provisions for data protection under GDPR, anti-money laundering compliance, and financial services regulations particular to the Maltese jurisdiction.

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What is a Broker To Broker Commission Agreement?

The Broker To Broker Commission Agreement is essential for establishing formal collaboration between brokerage firms operating under Maltese jurisdiction. This document is typically used when two or more brokers wish to formalize their commission sharing arrangements, whether for client referrals, shared services, or joint business ventures. It encompasses crucial elements such as commission structures, payment terms, regulatory compliance requirements (including MFSA regulations and EU directives), and operational procedures. The agreement is particularly important in Malta's financial services sector, where strict regulatory oversight requires clear documentation of inter-broker relationships. It addresses key aspects such as data protection under GDPR, anti-money laundering compliance, and specific financial services regulations, while providing flexibility to accommodate various types of brokerage services and commission arrangements.

What sections should be included in a Broker To Broker Commission Agreement?

1. Parties: Identification of the participating brokers, including full legal names, registration numbers, and registered addresses

2. Background: Context of the agreement, brief description of each broker's business, and purpose of the collaboration

3. Definitions: Detailed definitions of key terms used throughout the agreement, including 'Commission', 'Clients', 'Services', 'Territory', etc.

4. Scope of Agreement: Defines the nature of the relationship between the brokers and the territorial scope of their collaboration

5. Commission Structure: Details of commission rates, calculation methods, and payment terms

6. Payment Terms: Specifics about payment timing, currency, method of payment, and handling of taxes

7. Obligations of the Parties: Detailed responsibilities and duties of each broker, including regulatory compliance requirements

8. Regulatory Compliance: Commitments to comply with relevant laws, including AML, financial services regulations, and data protection

9. Confidentiality: Provisions for handling confidential information and client data

10. Term and Termination: Duration of the agreement and circumstances under which it can be terminated

11. Dispute Resolution: Procedures for handling disputes, including jurisdiction and applicable law

12. General Provisions: Standard clauses including notices, amendments, assignment, and severability

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

1. Non-Competition: Restrictions on competing activities, used when brokers want to prevent direct competition in specific markets

2. White Labeling: Terms for using each other's branding, included when one broker's services are marketed under the other's brand

3. Service Level Agreement: Specific performance metrics and standards, included for complex operational relationships

4. Insurance Requirements: Specific insurance obligations, included when dealing with high-value transactions or specific risks

5. Marketing and Promotion: Terms governing joint marketing activities, included when brokers plan collaborative promotional efforts

6. Data Processing Agreement: Detailed GDPR compliance terms, required when significant personal data processing is involved

7. Force Majeure: Provisions for unforeseen circumstances, particularly relevant in volatile markets or uncertain conditions

What schedules should be included in a Broker To Broker Commission Agreement?

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

2. Schedule 2 - Territory Definition: Specific geographical areas or markets covered by the agreement

3. Schedule 3 - Service Specifications: Detailed description of services covered under the agreement

4. Schedule 4 - Compliance Procedures: Specific procedures for ensuring regulatory compliance

5. Schedule 5 - Reporting Templates: Standard formats for regular reporting between parties

6. Appendix A - Required Licenses: Copies or details of regulatory licenses held by each party

7. Appendix B - Contact Details: Key contact information for both parties, including escalation procedures

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok成人版 | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents

Jurisdiction

Malta

Document Type

Broker Agreement

Cost

Free to use

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