Authorized Reseller Agreement Template for Indonesia

An Authorized Reseller Agreement is a comprehensive legal contract that governs the commercial relationship between a principal company (the product owner) and an authorized distributor in Indonesia. Under Indonesian law, this agreement must comply with Law No. 7 of 2014 on Trade and various Ministry of Trade regulations that govern distribution activities across the archipelago.

When do you need this document?

You need an Authorized Reseller Agreement when expanding your business through third-party distributors while maintaining control over how your products are sold. This document is essential for manufacturers, importers, or brand owners who want to establish exclusive or non-exclusive distribution arrangements in specific Indonesian territories. The agreement becomes particularly important when dealing with high-value products, branded goods, or items requiring specialized knowledge for proper sales and customer support. Given Indonesia's vast geography spanning over 17,000 islands, authorized reseller arrangements are often the most practical way to achieve comprehensive market coverage while ensuring consistent brand representation and customer experience.

Key legal considerations

Your agreement must address several critical legal aspects to protect both parties' interests. Territorial exclusivity clauses must comply with Law No. 5 of 1999 on Competition to avoid anti-monopoly violations, particularly regarding pricing policies and market restrictions. Product liability and warranty obligations must be clearly defined, especially considering Law No. 8 of 1999 on Consumer Protection requirements that apply when resellers sell to end consumers. The agreement should specify minimum purchase commitments, payment terms, and performance standards while incorporating appropriate termination clauses. Brand protection measures are crucial, including guidelines for marketing materials, authorized sales channels, and protection against counterfeit products. If your reseller will operate online channels, the agreement must comply with Government Regulation No. 80 of 2019 on e-commerce trading activities.

Legal requirements in Indonesia

Indonesian law imposes specific requirements on reseller agreements depending on the parties involved and business scope. If the principal is a foreign company, you may need to involve a local entity or authorized representative to comply with foreign investment regulations. The agreement must clearly identify all parties with complete legal names, registration numbers (NIB or previous SIUP), and registered addresses as required by trade licensing regulations. For resellers classified under Law No. 20 of 2008 on Micro, Small and Medium Enterprises, special provisions may apply regarding business licensing and operational requirements. The contract must be drafted in Indonesian language or include certified translations if executed in other languages for legal enforceability. Additionally, specific clauses addressing local content requirements, import duties, and distribution licensing obligations should be included where applicable to ensure full regulatory compliance.