Escrow Account Agreement Template for Indonesia

The Escrow Account Agreement is essential for transactions requiring secure third-party fund management under Indonesian law. It is commonly used in various business contexts including real estate transactions, merger and acquisition deals, and international trade arrangements where parties seek to mitigate transaction risks. The agreement establishes a secure mechanism for holding and disbursing funds based on predetermined conditions, ensuring compliance with Indonesian banking regulations and financial services laws. This document type is particularly crucial in the Indonesian business environment where formal escrow arrangements provide necessary security for high-value transactions and cross-border deals. The agreement includes comprehensive provisions for account operation, fund management, release mechanisms, and the rights and obligations of all parties involved, while ensuring compliance with local Know Your Customer (KYC) and anti-money laundering requirements.

1. Parties: Identifies all parties to the agreement: the depositor, the beneficiary, and the escrow agent (bank)

2. Background: Sets out the context of the agreement and the intention to establish an escrow arrangement

3. Definitions: Defines key terms used throughout the agreement

4. Appointment of Escrow Agent: Formal appointment of the bank as escrow agent and acceptance of the appointment

5. Escrow Account Establishment: Details of the escrow account setup, account number, and initial deposit requirements

6. Deposit of Funds: Procedures and requirements for depositing funds into the escrow account

7. Release Conditions: Specific conditions that must be met for the release of funds from the escrow account

8. Release Procedures: Step-by-step procedures for requesting and executing the release of funds

9. Escrow Agent's Duties: Detailed responsibilities and obligations of the escrow agent

10. Fees and Expenses: Escrow agent's fees and allocation of costs related to the escrow arrangement

11. Representations and Warranties: Standard representations and warranties from all parties

12. Liability and Indemnification: Limitations of liability and indemnification provisions for the escrow agent

13. Term and Termination: Duration of the agreement and circumstances for termination

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

15. Notices: Procedures for sending formal notices between parties

16. Miscellaneous: Standard boilerplate provisions including amendments, assignments, and severability