Agency Agreements in NSW: A Guide for Businesses and Agents

Agency agreements are a crucial part of most business relationships. They are used to establish a partnership between a business (the principal) and an agent who will act on behalf of the principal to carry out certain business activities. In New South Wales (NSW), agency agreements are governed by the Commercial Agents and Private Inquiry Agents Act 2004 (NSW) (the Act). This article will provide an overview of agency agreements in NSW, including their types, key elements, and legal requirements.

Types of Agency Agreements

In NSW, there are three main types of agency agreements: general agency, special agency, and universal agency. A general agency gives the agent broad authority to act on behalf of the principal in a specific type of business activity. A special agency only authorizes the agent to perform specific tasks for the principal, and the agent cannot exceed the authority provided in the agreement. A universal agency gives the agent unlimited authority to act on behalf of the principal, including signing contracts and making financial decisions.

Key Elements of an Agency Agreement

An agency agreement must include certain key elements to be legally enforceable. These elements include:

1. The parties: The agreement must clearly identify the principal and the agent. This includes their names and addresses.

2. The scope of authority: The agreement should specify the tasks that the agent is authorized to perform on behalf of the principal.

3. Compensation: The agreement should outline the compensation that the agent will receive for their services.

4. Termination: The agreement should specify the conditions under which either party can terminate the agreement.

Legal Requirements

In NSW, there are certain legal requirements that must be met when entering into an agency agreement. These include:

1. Written agreement: The agreement must be in writing and signed by both parties.

2. Disclosure requirements: The principal must disclose certain information to the agent, including the nature of the business, the scope of the agent`s authority, and the compensation that the agent will receive.

3. Registration: If the agent is a commercial agent, they must be licensed and registered with the NSW Police Force.


Agency agreements are an essential tool for businesses to expand their operations and reach new markets. However, they must be carefully drafted and executed to ensure that the rights and obligations of both parties are clearly defined. By understanding the types of agency agreements, key elements, and legal requirements in NSW, businesses and agents can establish successful partnerships that benefit both parties.