ABSTRACT
The intermediaries are in effect submitting an invoice for services rendered in assisting the primary intermediary agent (PIA) with the deal. Each intermediary, on receiving their commission payment, has an obligation to pay tax on their earnings as per the laws of their country. The Intermediary Pay Order and Guarantee (IPG) application as issued earlier and subsequently later is converted to a standby letter of credit (SLC) is issued at the point in the deal when the delivery documents are presented to the PIA in a clean state, that is once delivery has occurred. Under international trade law, there is a document that is defined as being first class evidence other than the bill of lading (BOL) that can be secured officially to record that the goods are on board the ship. If PIA fails to provide accurate information to prove that transfers took place, they could in fact find themselves with a tax bill for the total gross amount.
