IMFPA Commission Agreements Explained

An IMFPA, or Irrevocable Master Fee Protection Agreement, is a document used in commodity transactions to record which intermediaries are owed a commission and how much. When a paymaster pays commissions, the IMFPA is usually the document it follows.

What an IMFPA should contain

• The transaction it relates to, identified clearly (product, quantity, contract reference).
• Each beneficiary's full legal name and, for companies, the registered company name.
• The commission for each beneficiary, as an amount or a rate per unit, and whether it applies to each delivery or only the first.
• Each beneficiary's bank details, in the beneficiary's own name.
• Who pays the commissions (usually the seller) and when.
• Signatures of the paying party and the beneficiaries.

"Irrevocable" is not a guarantee

The word "irrevocable" in the title does not by itself make a commission collectible. Whether the agreement can be enforced depends on the facts, the governing law, and whether the transaction actually closes and is paid. A paymaster can pay only from funds it actually receives.

Mistakes that delay payment

• Names on the IMFPA that do not match the beneficiary's identification or bank account.
• Bank details that are later changed by email.
• Commission totals that do not match the funds actually paid.
• Unsigned or partly signed copies.

Before relying on an IMFPA, have it reviewed by your own lawyer.