The Difference Between Overriding Commission And Del Credere Commission

This article looks at the type of additional commission given by consignor to consignee and the purpose(s) of giving such incentives/commissions.

Overriding Commission

Purpose of such incentive is to motivate the consignee to create market for new products.

· Sometimes, this additional commission is allowed to consignee where certain sales limits have been exceeded.

Del Credere Commission

Purpose is for the consignee to bear/absorb the loss on account of bad debts if any, arising out of credit sales of consignment goods

· Once the consignee is given del credere commission, he become liable to all losses on account of non-recovery of debts