When is a Del credere agency established?

A Del credere agency is a specific type of agency arrangement where the agent not only facilitates the sale of goods on behalf of the principal but also assumes the risk of the buyer’s default. This means that the agent provides a guarantee to the principal for the performance of customers, effectively ensuring that they will receive payment regardless of whether the buyer fulfills their payment obligations. This added layer of responsibility distinguishes a Del credere agency from other types of agency relationships, where the agent does not guarantee payment.

In contrast, options that suggest the agent takes no commission, only represents the principal, or has no authority do not capture the essence of a Del credere agency. The key feature is the agent's role in guaranteeing performance, which aligns with the definition and nature of this type of agency relationship.