Discount Agreement Template for Indonesia

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Key Requirements PROMPT example:

Discount Agreement

"I need a Discount Agreement for my manufacturing company in Jakarta to provide tiered volume discounts to our industrial equipment buyers, starting from January 2025, with quarterly volume targets and specific provisions for bulk purchases exceeding 1000 units per order."

Document background

The Discount Agreement is a crucial commercial document used in Indonesian business transactions to formalize preferential pricing arrangements between parties. It is particularly relevant when establishing long-term business relationships involving regular purchases or when implementing tiered pricing structures based on volume or performance metrics. The document ensures compliance with Indonesian regulatory requirements, including the Civil Code (KUHPerdata), trade regulations, and competition laws. This agreement type is commonly used when suppliers wish to incentivize purchasing behavior, reward customer loyalty, or establish strategic partnerships through formalized discount structures. The document typically includes detailed provisions for discount calculations, qualifying criteria, reporting mechanisms, and compliance requirements, making it essential for businesses operating in the Indonesian market.

Suggested Sections

1. Parties: Identification of the parties entering into the agreement, including their full legal names, registration numbers, and addresses

2. Background: Context of the agreement, existing business relationship, and purpose of the discount arrangement

3. Definitions: Definitions of key terms used throughout the agreement, including 'Base Price', 'Discount Period', 'Qualifying Purchase', etc.

4. Discount Structure: Detailed explanation of the discount mechanism, including rates, tiers, and calculation methods

5. Qualifying Criteria: Conditions that must be met to qualify for discounts, including minimum purchase requirements or performance targets

6. Term and Duration: Period for which the discount agreement is valid, including start date and end date

7. Payment Terms: Terms for invoicing, payment timing, and method of applying discounts

8. Obligations of the Parties: Specific responsibilities of each party under the agreement

9. Confidentiality: Provisions protecting confidential information shared during the course of the agreement

10. Termination: Circumstances under which the agreement can be terminated and the process for termination

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

Optional Sections

1. Volume Commitments: Used when the discount is tied to specific volume commitments from the buyer

2. Marketing Cooperation: Include when the parties agree to joint marketing activities as part of the discount arrangement

3. Exclusivity Provisions: Added when the discount arrangement includes exclusivity requirements

4. Audit Rights: Include when verification of sales volumes or discount calculations may be necessary

5. Force Majeure: Added when parties want specific provisions for handling unforeseen circumstances

6. Anti-Corruption: Include when dealing with government entities or when required by corporate compliance

7. Electronic Commerce: Added when discounts apply to online transactions or electronic ordering systems

Suggested Schedules

1. Schedule 1 - Discount Rates: Detailed table of discount percentages, tiers, and applicable products/services

2. Schedule 2 - Product List: List of products or services covered by the discount agreement

3. Schedule 3 - Calculation Examples: Examples showing how discounts are calculated in various scenarios

4. Schedule 4 - Reporting Template: Standard format for reporting sales and calculating discounts

5. Appendix A - Contact Details: Key contact persons and their details for both parties

6. Appendix B - Performance Metrics: Metrics and KPIs used to measure qualification for discounts

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

alex.den.21@genieai.co

Relevant legal definitions

Clauses

Relevant Industries

Retail

Manufacturing

Consumer Goods

Electronics

Automotive

Pharmaceuticals

Construction Materials

Food and Beverage

Industrial Equipment

Telecommunications

Chemical Industry

Agriculture

Relevant Teams

Legal

Procurement

Sales

Finance

Commercial Operations

Business Development

Compliance

Contract Administration

Supply Chain

Pricing

Relevant Roles

Commercial Director

Procurement Manager

Sales Director

Finance Manager

Contract Administrator

Business Development Manager

Account Manager

Legal Counsel

Commercial Operations Manager

Pricing Analyst

Supply Chain Manager

Chief Financial Officer

Sales Operations Manager

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