The Referral Commission Agreement is essential for businesses operating in India that wish to formalize their referral partnerships and commission structures. This document is typically used when a company wants to expand its customer base or business opportunities through third-party referrals while maintaining legal compliance and operational clarity. The agreement addresses key aspects such as commission calculations, payment terms, referral tracking mechanisms, and parties' obligations, all within the framework of Indian law. It incorporates necessary provisions to comply with Indian taxation requirements, including TDS (Tax Deducted at Source) regulations, GST implications, and relevant commercial laws. The document is particularly important for businesses seeking to build structured referral networks while mitigating legal risks and ensuring transparent commission arrangements.
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1. Parties: Identifies and provides full details of the parties entering into the agreement, including registered addresses and company registration numbers
2. Background: Explains the context of the agreement and the parties' intentions to enter into a referral relationship
3. Definitions: Defines key terms used throughout the agreement for clarity and precision
4. Appointment and Scope: Establishes the referrer's appointment and defines the scope of referral services
5. Referral Process: Details the procedure for making and tracking referrals
6. Commission Structure: Specifies the commission rates, calculation method, and payment terms
7. Payment Terms: Outlines the timing, method, and currency of commission payments
8. Obligations of the Referrer: Lists the referrer's duties, responsibilities, and service standards
9. Obligations of the Company: Details the company's commitments and responsibilities
10. Term and Termination: Specifies the duration of the agreement and conditions for termination
11. Confidentiality: Establishes confidentiality obligations for both parties
12. Non-Solicitation: Prevents parties from soliciting each other's employees or clients
13. Representations and Warranties: Contains standard warranties and representations from both parties
14. Indemnification: Details mutual indemnification obligations
15. Governing Law and Jurisdiction: Specifies applicable law and jurisdiction for dispute resolution
16. General Provisions: Includes standard boilerplate clauses such as force majeure, notices, and amendments
1. Non-Compete: Restricts the referrer from engaging with competitors - include when exclusivity is required
2. Data Protection: Include when personal data processing is involved in the referral process
3. Intellectual Property: Include when brand names, trademarks, or other IP will be used by either party
4. Insurance: Include when specific insurance coverage is required for the referral activities
5. Audit Rights: Include when the company needs rights to audit the referrer's activities and records
6. Training and Support: Include when the company will provide training or support services to the referrer
7. Marketing and Promotion: Include when specific marketing activities or brand usage guidelines need to be established
8. Compliance with Laws: Include detailed compliance requirements when operating in regulated industries
1. Commission Rates and Calculations: Detailed breakdown of commission structures, tiers, and calculation methods
2. Referral Territory: Defines the geographic or market scope of the referral arrangement
3. Products and Services: List of products or services eligible for referral commissions
4. Reporting Format: Templates and formats for referral tracking and commission reports
5. Service Level Agreement: Specific performance metrics and service standards if applicable
6. Approved Marketing Materials: Pre-approved marketing content and usage guidelines
7. Contact Details: Key contact persons and escalation matrix for both parties
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