An Exclusive Distribution Agreement is essential when a supplier wishes to establish a controlled distribution channel in Indonesia through a single distributor in specified territories. This document is particularly relevant for foreign companies entering the Indonesian market who need to comply with local distribution regulations, including Law No. 7 of 2014 on Trade and Government Regulation No. 34 of 2016. The agreement typically includes detailed provisions on exclusivity rights, territorial restrictions, performance requirements, and compliance with Indonesian laws. It's commonly used when the supplier wants to maintain brand control, ensure market development, and establish a strong local presence while working with a single partner who has established distribution networks and market knowledge in Indonesia.
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1. Parties: Identification of the supplier and distributor, including registration details as required by Indonesian law
2. Background: Context of the agreement, nature of the parties' businesses, and their intentions
3. Definitions: Definitions of key terms used throughout the agreement
4. Appointment and Territory: Grant of exclusive distribution rights and definition of the territorial scope
5. Term and Renewal: Duration of the agreement and conditions for renewal
6. Supplier's Obligations: Key obligations of the supplier including supply commitments and support
7. Distributor's Obligations: Core obligations of the distributor including sales, marketing, and reporting requirements
8. Ordering and Supply: Process for ordering products, delivery terms, and acceptance procedures
9. Prices and Payment: Pricing structure, payment terms, and currency provisions
10. Intellectual Property: License to use trademarks and protection of intellectual property rights
11. Compliance: Compliance with Indonesian laws, including trade regulations and anti-corruption laws
12. Confidentiality: Protection of confidential information and trade secrets
13. Termination: Grounds for termination and consequences of termination
14. Post-Termination: Obligations and rights of parties after termination
15. Governing Law and Dispute Resolution: Choice of Indonesian law and dispute resolution mechanisms
16. General Provisions: Standard boilerplate clauses including force majeure, notices, and amendments
1. Import/Export Requirements: Required when products are imported/exported, covering customs, permits, and compliance with international trade regulations
2. Minimum Purchase Requirements: Include when the agreement specifies minimum purchase quantities or sales targets
3. Marketing and Promotion: Detailed section when extensive marketing obligations are required, including marketing plans and budgets
4. After-Sales Service: Required when distributor provides warranty service or maintenance
5. Non-Competition: Include when restricting distributor from handling competing products
6. Performance Reviews: Include when regular performance evaluations are required
7. Training Requirements: Required when supplier provides product or technical training
8. Insurance: Detailed insurance requirements when product liability risks are significant
1. Schedule 1 - Products: Detailed list and specifications of products covered by the agreement
2. Schedule 2 - Territory: Detailed description of the exclusive territory, including maps if relevant
3. Schedule 3 - Prices: Price list and discount structure
4. Schedule 4 - Minimum Purchase Quantities: Details of any minimum purchase requirements or targets
5. Schedule 5 - Technical Requirements: Technical specifications and quality standards
6. Schedule 6 - Trademark Usage Guidelines: Guidelines for use of supplier's trademarks and branding
7. Schedule 7 - Service Level Requirements: Standards for customer service and after-sales support
8. Appendix A - Reporting Templates: Standard forms for required periodic reports
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