Address Commission

Summary of Address Commission

A commission payable to a third party arising from a contract to charter a ship. Commonly known as ADCOM, this is not a brokerage fee but an additional commission paid by the vessel to any third party named by the charterer. An adcom is usually expressed as a percentage of the charter hire of the vessel; the percentage is negotiated between the vessel owner and the charterer. In some cases, the firm chartering the vessel may nominate itself or an affiliated company to receive the adcom, thus resulting in a reduction in actual freight.

(Main Author: William J. Miller)