Business Management Agreement Template for Indonesia

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Key Requirements PROMPT example:

Business Management Agreement

"I need a Business Management Agreement for my hotel in Jakarta, where I want to appoint an international hospitality management company to fully operate the property starting March 2025, including staff management and brand standards implementation."

Document background
The Business Management Agreement serves as a crucial legal instrument in Indonesian business operations where a company seeks to delegate its management functions to a professional management entity. This document is particularly relevant when businesses require specialized management expertise, during succession planning, or when expanding operations. It must comply with Indonesian regulatory requirements, including Law No. 40 of 2007 on Limited Liability Companies and Law No. 25 of 2007 on Investment. The agreement typically includes detailed provisions for management authority, operational control, performance metrics, reporting structures, and fee arrangements. It's essential for businesses seeking professional management while maintaining ownership and ultimate control, common in various sectors from hospitality to manufacturing. The document must be drafted in both Indonesian and English languages to ensure legal enforceability and practical usability.
Suggested Sections

1. Parties: Identification of the business owner/company and the management company, including full legal names, registration numbers, and addresses

2. Background: Context of the agreement, business description, and purpose of engaging the management company

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

4. Appointment and Scope: Formal appointment of the management company and detailed scope of management services

5. Term and Renewal: Duration of the agreement and conditions for renewal

6. Management Rights and Authority: Specific powers granted to the management company and any limitations

7. Duties and Responsibilities: Detailed obligations of the management company in operating the business

8. Owner's Rights and Obligations: Business owner's retained rights and supporting obligations

9. Fees and Payment Terms: Management fees, payment structure, and payment terms

10. Reporting and Accountability: Required reports, frequency, and accountability measures

11. Confidentiality: Protection of confidential information and trade secrets

12. Intellectual Property: Ownership and usage rights of IP developed during the management period

13. Representations and Warranties: Standard declarations by both parties about their capacity and authority

14. Termination: Grounds for termination and termination procedures

15. Governing Law and Dispute Resolution: Choice of Indonesian law and dispute resolution mechanisms

16. General Provisions: Standard boilerplate clauses including notices, amendments, and severability

Optional Sections

1. Non-Compete: Restrictions on management company's ability to manage competing businesses - include when there are direct competitors in the market

2. Force Majeure: Provisions for unforeseen circumstances - particularly relevant in volatile markets or industries

3. Insurance: Required insurance coverage - include for high-risk industries or where significant assets are involved

4. Environmental Compliance: Environmental obligations - include for industries with environmental impact

5. Staff Transfer: Provisions for handling existing employees - include when existing staff will be managed by the management company

6. Performance Metrics: Specific KPIs and performance standards - include when quantifiable targets are crucial

7. Audit Rights: Rights to audit management company's operations - include for complex operations or high-value contracts

Suggested Schedules

1. Schedule 1: Scope of Services: Detailed breakdown of management services to be provided

2. Schedule 2: Fee Structure: Detailed calculation of management fees, including base fees and performance bonuses

3. Schedule 3: Key Personnel: List of key management personnel and their roles

4. Schedule 4: Performance Standards: Specific performance metrics and evaluation criteria

5. Schedule 5: Reporting Requirements: Templates and specifications for required reports

6. Schedule 6: Operating Procedures: Standard operating procedures and protocols

7. Appendix A: Power of Attorney: Format of power of attorney for specific management actions

8. Appendix B: Company Assets: Inventory of assets under management

9. Appendix C: Required Licenses: List of necessary business licenses and permits

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

Relevant legal definitions
Clauses
Relevant Industries

Hospitality

Real Estate

Manufacturing

Retail

Healthcare

Education

Food and Beverage

Mining

Agriculture

Technology

Transportation and Logistics

Entertainment and Leisure

Professional Services

Construction

Energy

Relevant Teams

Legal

Executive Leadership

Operations

Finance

Compliance

Human Resources

Risk Management

Project Management

Business Development

Corporate Affairs

Administration

Relevant Roles

CEO

Managing Director

Operations Director

Legal Counsel

Corporate Secretary

Chief Financial Officer

Business Development Manager

General Manager

Operations Manager

Contract Manager

Compliance Officer

Risk Manager

Project Manager

Human Resources Director

Finance 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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