A business finder is a person who carries out occasional or non-permanent business promotion activities on behalf of a company, identifying potential clients or commercial opportunities in return for a commission.
Unlike a commercial agent, a business finder does not normally operate on the basis of a permanent and ongoing mandate and does not undertake any obligation to systematically promote the conclusion of contracts in a specific area or for a specific client base.
The activity therefore consists mainly of referring business, without a binding commitment to a stable working relationship comparable to an agency contract.
A commercial agent operates on the basis of an agency contract governed by Articles 1742 et seq. of the Civil Code and assumes a permanent role in promoting contracts on behalf of the principal.
The business finder:
The relationship is governed primarily by a business finder contract, which may also be verbal or implied.
No professional or moral requirements are imposed on business finders.
They must, however, have legal capacity and therefore be at least 18 years of age.
To be registered in the Companies Register, it is nevertheless necessary to produce a letter of appointment or a preliminary contract with at least one client company.
The Court of Cassation, in its judgement no. 16147 of 8 July 2010 and, more recently, in its judgement no. 19161 of 2 August 2017, ruled that business finders in the property sector must meet the requirements set out in Law no. 39 of 3 February 1989.
To register the activity of “business finder in the property sector” with the Companies Register, the application for registration must be accompanied by the relevant Certified Notification of Commencement of Activity (MEDIATORI form) for the purposes of self-certifying that the moral and professional requirements are met.
The activity of a business finder does not entail any specific restrictions on incompatibility, subject to any such restrictions that may apply in relation to employment relationships or protected professions exercised concurrently by the finder.
For tax and civil law purposes, a business finder is considered an entrepreneur if they carry out the activity on a non-occasional basis.
VAT numberThe withholding tax may be calculated on only 20 per cent of the commissions, based on a specific declaration by the business finder, in which they certify that they make continuous use of the services of employees or third parties.
Car expensesBusiness finders may deduct 40 per cent of the VAT relating to the company car.
They may also deduct the following as costs:
However, a relationship formally classified as business finding may be reclassified as an agency relationship if, in practice, it exhibits characteristics of stability, continuity, organisation and integration into the company’s commercial activities.
Accounting regimeThe business finder represents a more flexible contractual arrangement than that of a commercial agent, but must be used correctly.
The decisive factor is the actual manner in which the business is conducted: if the collaborator operates in a stable, continuous and organised manner in promoting business, the relationship may be considered an agency contract, with the consequent application of the relevant civil law, social security and pension regulations.
Set out below are the main differences between a Commercial Agent, a Business Finder and a Business Broker.