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convenience.9 Accordingly, we conclude that the list brokers'
activities are services and are not part of the royalty-related
activities. Consequently, any portion of the mailers' payments
that is to compensate the list brokers for their activities in
the mailing list transaction is not a royalty.
Our inquiry as to the list brokers' services, however, does
not end there. Because we hold that the portion of the mailers'
payments that is related to the list brokers' activities is not a
royalty, we must address respondent's other arguments that the
list brokers are petitioner's agents for carrying on a list
rental business and that any services they provide and any
portion of the list rental payment received by them for the
rental of petitioner's list should be attributed to petitioner
for purposes of calculating petitioner's UBTI. Petitioner argues
that the list brokers are independent contractors and that the
services they provide, and any compensation they receive for such
services, should not be attributed to petitioner.
As to whether an agency relationship exists, the manner in
which the parties to an agreement designate their relationship is
not controlling. See Board of Trade v. Hammond Elevator Co., 198
U.S. 424, 437 (1905). Rather, the question of agency is based on
9 As discussed below, this factor is also important in
deciding whether the list brokers are petitioner's agents.
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