Control Agreement Template for Indonesia

Use a Control Agreement when securing loans with deposit accounts or investment portfolios in Indonesia. It's particularly valuable for lenders financing businesses with significant liquid assets, or when extending credit facilities that require ongoing monitoring of the borrower's financial position.

The agreement becomes essential in situations where traditional collateral like property or equipment isn't practical or sufficient. Indonesian banks often require Control Agreements for revolving credit facilities, working capital loans, and trade finance arrangements. This arrangement gives lenders immediate protection if a borrower faces financial distress, allowing quick access to secured accounts without court intervention.

• Account Control Agreement: Basic form used for standard bank accounts, giving lenders control over deposit accounts
• Securities Account Control Agreement: Specifically designed for investment and securities accounts, including special provisions for trading activities
• Collateral Control Agreement: Broader agreement covering multiple types of financial assets as collateral
• Global Collateral Account Control Agreement: Used for international accounts and cross-border transactions
• Joint Control Addendum: Supplements existing agreements to add joint control provisions between multiple parties

• Banks and Financial Institutions: Act as lenders and require Control Agreements to secure their loans and credit facilities
• Corporate Borrowers: Companies seeking financing who must grant control over their accounts as loan security
• Account Banks: Financial institutions holding the controlled accounts, who must comply with the lender's instructions
• Legal Counsel: Draft and review agreements to ensure compliance with OJK regulations and Indonesian secured transaction laws
• Corporate Officers: Sign on behalf of borrowing companies and manage compliance with agreement terms
• Compliance Teams: Monitor and ensure ongoing adherence to control requirements and reporting obligations

• Account Details: Gather complete account numbers, types, and locations of all accounts to be controlled
• Party Information: Collect legal names, registration numbers, and authorized signatories of all parties
• Loan Details: Document the underlying credit facility terms, amounts, and security requirements
• Bank Requirements: Obtain specific forms and procedures from the account-holding bank
• Control Mechanics: Define how account access and instructions will work in practice
• Compliance Check: Verify alignment with OJK regulations and Indonesian secured transaction laws
• Documentation: Use our platform to generate a legally-sound Control Agreement that includes all required elements

• Party Identification: Full legal names, addresses, and registration numbers of lender, borrower, and account bank
• Account Details: Specific identification of all controlled accounts and permitted activities
• Control Mechanisms: Clear procedures for account access, instructions, and operational controls
• Default Provisions: Triggers and consequences of default under Indonesian secured transaction laws
• Notice Requirements: Communication protocols between all parties
• Governing Law: Explicit reference to Indonesian law and OJK regulations
• Dispute Resolution: Clear jurisdiction and dispute settlement procedures
• Termination Terms: Conditions and process for ending the agreement

A Control Agreement often gets confused with an Account Agreement, but they serve distinct purposes in Indonesian banking and finance. While both deal with bank accounts, their scope and legal effects are quite different.

• Purpose and Function: Control Agreements create security rights over accounts for lenders, while Account Agreements establish the basic relationship between a bank and its customer
• Parties Involved: Control Agreements require three parties (lender, borrower, and account bank), whereas Account Agreements are bilateral between bank and account holder
• Legal Effect: Control Agreements grant specific rights to lenders under Indonesian secured transaction laws, while Account Agreements govern general account operations
• Enforcement Rights: Control Agreements provide direct access to accounts during default, but Account Agreements don't create security interests
• Regulatory Framework: Control Agreements must comply with OJK's secured lending regulations, while Account Agreements follow basic banking regulations