Brokerage commission
Meaning
Brokerage commission is the fee owners pay the brokers who arranged the fixture, a percentage of freight, deadfreight and demurrage.
Also written as Brokerage, Broker commission
Brokerage commission explained
Brokerage on tanker fixtures is typically 1.25% per broker and is paid by the owner from the freight. When two brokers are involved, one on each side, each normally receives its own share.
Commission is usually only payable on freight and demurrage actually earned and received, so a failed or unpaid voyage generally means no commission.
Related terms
Address commission
Address commission is a percentage of the freight or hire that the owner pays back to the charterer, effectively a discount on the rate.
Freight
Freight is the payment a charterer makes to the owner for carrying cargo under a voyage charter, quoted per tonne, as a lumpsum or in Worldscale.
TCE
TCE (time charter equivalent) converts a voyage's freight into daily earnings: freight minus voyage costs, divided by the days the voyage takes.