The arm's length relationship between the escort and the escort agency is designed to protect the escort agency (to some degree) from prosecution for breaking laws against prostitution.
Some countries have used a two-pronged approach of criminalizing street prostitution but permitting or licensing prostitution in brothels or via escort agencies.
Escort agencies are companies that provide escorts for clients, usually for sexual services.
The agency typically arranges a meeting between one of its escorts and the client at the customer's house or hotel room (outcall), or at the escort's residence (incall).
Escort agencies claim that they are dispatching these individuals to provide a social or conversational service rather than a sexual service, since prostitution laws often forbid taking payment for sex or communicating for the purpose of arranging a contract for sexual services.
Advertisements for escort agencies often carefully skirt the legal line, and avoid specifically offering prostitution or sexual services.