Which statement correctly distinguishes commissions?

Which statement correctly distinguishes commissions?

• A. Address commission is paid by ship owner to charterer; brokers' commission is paid to the broker.
• B. Address commission is paid to the broker; brokers' commission is paid by ship owner to charterer.
• C. Address commission is paid to the charterer; brokers' commission is paid to the ship owner.
• D. Address commission and brokers' commission are both paid by the charterer to the broker.

Answer: (A)

The key idea is identifying two different commissions in chartering and who each is paid to. The address commission is a payment from the shipowner to the charterer as compensation for arranging the charter and facilitating the voyage. The brokers’ commission is the fee earned by the broker for arranging the charter, paid to the broker for their services. This aligns with the statement that the address commission flows from the shipowner to the charterer, while the brokers’ commission goes to the broker. The other options mix up who pays or who receives these fees, which doesn’t fit standard practice.

The key idea is identifying two different commissions in chartering and who each is paid to. The address commission is a payment from the shipowner to the charterer as compensation for arranging the charter and facilitating the voyage. The brokers’ commission is the fee earned by the broker for arranging the charter, paid to the broker for their services. This aligns with the statement that the address commission flows from the shipowner to the charterer, while the brokers’ commission goes to the broker. The other options mix up who pays or who receives these fees, which doesn’t fit standard practice.