Fiscal Agent Agreements

A fiscal agent fulfills financial services.

Agreeing to a fiscal agency carries a different meaning than agreeing to a trusteeship. However, the agreement still involves a serious financial responsibility, which may sometimes involve another person's health care.

Distinction

While a trustee agreement requires an individual or organization make financial decision in behalf of another person, a fiscal agency agreement only requires carrying out the financial decisions made by another. Therefore, a fiscal agent cannot be held liable for fulfilling such decisions, being only a representative.

Scope

According to "The Handbook of International Financial Terms," fiscal agency commonly occurs in the economic sector, with agents often being financial institutions such as banks. A fiscal agent agreement may also be seen in the health care industry, where states may use fiscal agencies for administering state health care benefits, such as Medicaid.

Services

In the economic sector, services which may be stipulated in the agreement could include a bank making principal and interest payments to bondholders. Further, administrative tasks might also be performed, including publishing important notices to bondholders.

References

• Investor Words: Trustee
• "The Handbook of International Financial Terms"; Peter Moles, Nicholas Terry; 1997
• "Welfare Medicine in America"; Robert Bocking Stevens, Rosemary Stevens; 2003
• "Current Developments in Monetary and Financial Law"; International Monetary Fund. Legal Dept, IMF Institute; 2005