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no dealing with that mailer or broker. Moreover, although the
list broker's commission is factored into the base price that is
listed on the data cards describing petitioner's rental list, the
bill sent by the list manager includes a list broker's commission
only where the list manager acts as the list broker. If the
mailer uses an independent list broker, the list manager sends
that list broker a bill that does not include a list broker's
commission. Accordingly, it remains the list broker's choice
whether to charge the mailer any list brokerage commission. On
the basis of the foregoing, we conclude that the list brokers and
list manager, when it is acting in its capacity as list broker,
are not agents of petitioner, and, therefore, neither their
activities nor the compensation that they receive for those
activities can be attributed to petitioner. Consequently, the
list brokerage activities do not change the character of the
remainder of the mailers' list rental payments.
In sum, we hold that with the exception of the list
brokerage activities (which are not attributable to petitioner),
all of the activities in which the parties to the list rental
transaction engage are royalty-related activities. Consequently,
with the exception of the list brokerage commissions (which are
not attributable to petitioner), the mailer's list rental payment
in each list rental transaction is a royalty which is excluded
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