Business Agreement Between Two Parties for Indonesia

Business Agreement Between Two Parties Template for Indonesia

A comprehensive business agreement template designed for use under Indonesian law, specifically crafted to establish and govern commercial relationships between two business entities. This document incorporates key requirements of Indonesian contract law, including mandatory Bahasa Indonesia language provisions under Law No. 24 of 2009, while addressing essential business terms, rights, obligations, and dispute resolution mechanisms. The agreement structure ensures compliance with the Indonesian Civil Code (KUHPerdata) and relevant commercial regulations while providing flexibility to accommodate various business arrangements and sector-specific requirements.

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What is a Business Agreement Between Two Parties?

The Business Agreement Between Two Parties serves as a foundational document for establishing formal commercial relationships in Indonesia's dynamic business environment. This template is designed for use when two business entities need to formalize their commercial arrangement, whether for goods, services, or other business collaborations. It ensures compliance with Indonesian legal requirements, including the Indonesian Civil Code (KUHPerdata), Law No. 40 of 2007 on Limited Liability Companies, and Law No. 24 of 2009 regarding language requirements. The document is particularly relevant for both domestic and international business transactions, incorporating necessary provisions for corporate authority, dispute resolution, and regulatory compliance while maintaining flexibility for specific business needs and sector requirements.

What sections should be included in a Business Agreement Between Two Parties?

1. Parties: Detailed identification of both parties, including full legal names, registration numbers, addresses, and authorized representatives

2. Background: Context of the agreement, relationship between parties, and purpose of entering into the agreement

3. Definitions: Clear definitions of key terms used throughout the agreement

4. Scope of Agreement: Detailed description of the business relationship and services/goods to be provided

5. Rights and Obligations: Specific duties and rights of each party under the agreement

6. Term and Termination: Duration of the agreement, renewal terms, and conditions for termination

7. Payment Terms: Payment amounts, schedules, methods, and currency specifications

8. Representations and Warranties: Statements of fact and promises made by each party

9. Confidentiality: Provisions for handling confidential information and trade secrets

10. Force Majeure: Circumstances under which parties may be excused from performance

11. Governing Law: Specification of Indonesian law as governing law and jurisdiction

12. Dispute Resolution: Process for resolving disputes, including jurisdiction and arbitration provisions

13. Language: Specification of language versions and controlling language (must address Indonesian language requirement)

14. Notices: Process and addresses for formal communications between parties

15. Execution: Signature blocks and execution requirements

What sections are optional to include in a Business Agreement Between Two Parties?

1. Intellectual Property Rights: Include when agreement involves creation, licensing, or use of intellectual property

2. Insurance: Include when specific insurance coverage is required from either party

3. Personnel and Safety: Include when services involve on-site work or deployment of personnel

4. Compliance with Laws: Include when specific regulatory compliance needs emphasis (e.g., data protection, industry regulations)

5. Assignment and Subcontracting: Include when transfer of rights or subcontracting needs to be addressed

6. Change Control: Include for agreements where scope or specifications might need formal change processes

7. Performance Metrics: Include when specific performance standards or KPIs need to be met

8. Bank Guarantees: Include when financial security or performance bonds are required

What schedules should be included in a Business Agreement Between Two Parties?

1. Schedule 1 - Scope of Work: Detailed description of services/goods to be provided, including specifications and deliverables

2. Schedule 2 - Pricing and Payment Schedule: Detailed breakdown of prices, payment milestones, and payment terms

3. Schedule 3 - Service Levels: Performance standards, metrics, and associated penalties/rewards if applicable

4. Schedule 4 - Key Personnel: List of key personnel from both parties responsible for agreement implementation

5. Schedule 5 - Technical Specifications: Detailed technical requirements and specifications

6. Appendix A - Required Documents: Copies of licenses, permits, and other required documentation

7. Appendix B - Form of Bank Guarantee: Template for bank guarantees if required

8. Appendix C - Compliance Certificates: Relevant compliance certificates and regulatory approvals

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Indonesia

Publisher

Genie AI

Document Type

Agreement Contract

Cost

Free to use
Clauses
Relevant Industries

Manufacturing

Technology

Retail

Distribution

Professional Services

Construction

Energy

Agriculture

Healthcare

Transportation

Financial Services

Telecommunications

Mining

Education

Food and Beverage

Relevant Teams

Legal

Commercial

Business Development

Operations

Procurement

Finance

Compliance

Risk Management

Corporate Secretariat

Project Management

Account Management

Relevant Roles

Chief Executive Officer

Managing Director

Commercial Director

Legal Counsel

Contract Manager

Business Development Manager

Operations Director

Procurement Manager

Company Secretary

Chief Financial Officer

Project Manager

Account Manager

Compliance Officer

Risk Manager

General Manager

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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