Opinion required re an agency agreement btw a HH Co and UK Ltd
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Description
Experience Level: Expert
There is an agency agreement between a HK Company and a UK Ltd in which the UK Ltd company in which the UK Ltd companies has most of its profits transferred to HK. We need to have a tax opinion that clarify if this is allowable and legal. It this considered as tax avoidance?
IF THIS IS NOT YOUR AREA OF WORK
IF YOU JUST DISCOVER WHAT AN AGENCY AGREEMENT IS
Dont bother replying.
Only UK tax advisers or accountants will be considered.
Below is the draft agreement.
As you know, UK Ltd. (the “commercial agent”) acts as the intermediary who has continuing authority to represent and negotiate the sale or purchase of goods on behalf of HK Ltd. (the “principal”).
AGENCY AGREEMENT
This Agency Agreement is entered into as of xx 20xx by and between XX LIMITED having its principal place of business located at XX, Hong Kong (the “Company”) and XX LTD.
having its principal place of business located at XX United Kingdom (the “Agent”), both of whom agree to be bound by this Agreement. WHEREAS, the Company offers customers certain products, as described on the document attached hereto as Exhibit A (the “Products”); and WHEREAS, the Company and the Agent desire to enter into an agreement whereby the Agent will market and sell the Product according to the terms and conditions herein. NOW, THEREFORE, in consideration of the mutual covenants and promises made by the parties hereto, the Company and the Agent (individually, each a “Party” and collectively, the “Parties”) covenant and agree as follows:
ASSIGNMENT OF RIGHT.
With certain limitations stated herein, the Company hereby authorizes the Agent the right to market and offer for sale the Products according to the terms and limitations stated in this Agency Agreement.
1. The Agent shall only market and offer for sale the products within the Territory, as defined in this Agreement.
2. The Company reserves the right to add to or subtract from the list of Products authorized on Exhibit A attached hereto with notice to the Agent.
2. The Company hereby grants to the Agent for the duration of this Agreement and subject to the limitations stated within this Agreement a non-exclusive, non-transferable, revocable right to use the Company Trademarks as necessary to market and offer for sale the Products within the Territory.
COMMISSION.
The Company shall pay to the Agent 5% (Five Percent) of all Net Product Sales directly from the Agent’s efforts. “Net Product Sales” shall be defined as the amount of sales revenue from any sales made by the Agent less any chargebacks, returns, or defaults by customers.
1. Should the Parties terminate this Agreement for any reason, the Company shall pay the Agent only for sales of the Products made prior to the termination date.
2. In the event that the Agent receives commission payments for orders that are subsequently refunded, charged back, or the Company otherwise fails to realize the income from such a sale, the Agent shall offset any future commissions paid by the amount by which the commissions actually paid would be reduced if the sales associated with income the Company failed to realize were never completed.
IF THIS IS NOT YOUR AREA OF WORK
IF YOU JUST DISCOVER WHAT AN AGENCY AGREEMENT IS
Dont bother replying.
Only UK tax advisers or accountants will be considered.
Below is the draft agreement.
As you know, UK Ltd. (the “commercial agent”) acts as the intermediary who has continuing authority to represent and negotiate the sale or purchase of goods on behalf of HK Ltd. (the “principal”).
AGENCY AGREEMENT
This Agency Agreement is entered into as of xx 20xx by and between XX LIMITED having its principal place of business located at XX, Hong Kong (the “Company”) and XX LTD.
having its principal place of business located at XX United Kingdom (the “Agent”), both of whom agree to be bound by this Agreement. WHEREAS, the Company offers customers certain products, as described on the document attached hereto as Exhibit A (the “Products”); and WHEREAS, the Company and the Agent desire to enter into an agreement whereby the Agent will market and sell the Product according to the terms and conditions herein. NOW, THEREFORE, in consideration of the mutual covenants and promises made by the parties hereto, the Company and the Agent (individually, each a “Party” and collectively, the “Parties”) covenant and agree as follows:
ASSIGNMENT OF RIGHT.
With certain limitations stated herein, the Company hereby authorizes the Agent the right to market and offer for sale the Products according to the terms and limitations stated in this Agency Agreement.
1. The Agent shall only market and offer for sale the products within the Territory, as defined in this Agreement.
2. The Company reserves the right to add to or subtract from the list of Products authorized on Exhibit A attached hereto with notice to the Agent.
2. The Company hereby grants to the Agent for the duration of this Agreement and subject to the limitations stated within this Agreement a non-exclusive, non-transferable, revocable right to use the Company Trademarks as necessary to market and offer for sale the Products within the Territory.
COMMISSION.
The Company shall pay to the Agent 5% (Five Percent) of all Net Product Sales directly from the Agent’s efforts. “Net Product Sales” shall be defined as the amount of sales revenue from any sales made by the Agent less any chargebacks, returns, or defaults by customers.
1. Should the Parties terminate this Agreement for any reason, the Company shall pay the Agent only for sales of the Products made prior to the termination date.
2. In the event that the Agent receives commission payments for orders that are subsequently refunded, charged back, or the Company otherwise fails to realize the income from such a sale, the Agent shall offset any future commissions paid by the amount by which the commissions actually paid would be reduced if the sales associated with income the Company failed to realize were never completed.
Rakoto R.
93% (18)Projects Completed
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