Franchisor Franchisee Agreement Template for Indonesia

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Key Requirements PROMPT example:

Franchisor Franchisee Agreement

"I need a Franchisor Franchisee Agreement for my international coffee shop chain expanding into Indonesia, granting exclusive rights for Jakarta and Bali regions, with provisions for opening 5 locations by March 2025 and including strong quality control measures for maintaining our international brand standards."

Document background
The Franchisor Franchisee Agreement is a crucial document used when establishing a franchise business relationship in Indonesia. It serves as the primary legal framework governing the rights and responsibilities of both the franchisor and franchisee, ensuring compliance with Indonesian franchise regulations, particularly Government Regulation No. 42 of 2007 and Ministry of Trade requirements. This agreement is essential for businesses seeking to expand through franchising in Indonesia, covering everything from intellectual property rights and operational standards to local content requirements and mandatory registration procedures. It includes specific provisions for protecting the franchisor's business system while ensuring the franchisee's rights are properly addressed, all within the context of Indonesian business law and practice.
Suggested Sections

1. Parties: Identification of the franchisor and franchisee, including complete legal names, registration numbers, and addresses

2. Background: Context of the agreement, description of the franchise system, and brief history of the franchise business

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

4. Grant of Franchise: Scope of franchise rights, territory, and exclusivity provisions

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

6. Franchise Fees: Initial franchise fee, ongoing royalties, and other financial obligations

7. Intellectual Property Rights: Terms of use for trademarks, patents, copyright, and trade secrets

8. Training and Support: Franchisor's obligations for initial and ongoing training and support

9. Operating Standards: Required operational procedures and quality standards

10. Marketing and Advertising: Marketing obligations, advertising fees, and promotional requirements

11. Reporting and Inspection: Financial reporting requirements and franchisor's right to inspect

12. Confidentiality: Protection of confidential information and trade secrets

13. Non-Competition: Restrictions during and after the franchise relationship

14. Termination: Grounds for termination and post-termination obligations

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

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

Optional Sections

1. Multi-Unit Development: Used when granting rights to develop multiple franchise units

2. Local Content Requirements: Specific section addressing Indonesian local content requirements if applicable to the industry

3. E-Commerce Rights: Digital sales channels and online presence regulations

4. Halal Certification: Required for food and beverage franchises or products requiring halal certification

5. Master Franchise Provisions: Used when the agreement is for a master franchise arrangement

6. Import Requirements: Specific provisions for franchises requiring imported products or materials

7. Property Lease Obligations: Required when the franchisor is involved in property leasing arrangements

8. Currency and Exchange Rate Provisions: Required for international franchises with cross-border payments

Suggested Schedules

1. Operations Manual Table of Contents: List of contents of the confidential operations manual

2. Approved Products and Services: Detailed list of authorized products and services

3. Territory Map: Detailed description and/or map of the granted territory

4. Initial Fee Schedule: Breakdown of initial franchise fees and payment terms

5. Equipment and Inventory Requirements: Specifications for required equipment and inventory

6. Training Program: Detail of initial and ongoing training programs

7. Approved Suppliers: List of approved suppliers and purchasing requirements

8. Brand Standards Manual: Guidelines for use of trademarks and brand elements

9. Form of Personal Guarantee: Standard form for personal guarantees if required

10. Insurance Requirements: Detailed insurance coverage requirements

11. Local Content Compliance Plan: Strategy and timeline for meeting local content requirements

12. Initial Investment Breakdown: Detailed estimate of initial investment requirements

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

Food and Beverage

Retail

Education and Training

Healthcare Services

Hospitality

Personal Services

Automotive Services

Technology and Electronics

Fashion and Accessories

Convenience Stores

Beauty and Wellness

Professional Services

Relevant Teams

Legal

Operations

Business Development

Compliance

Finance

Brand Management

Training

Quality Assurance

Commercial

Intellectual Property

Regional Development

Relevant Roles

Chief Executive Officer

Chief Legal Officer

Franchise Development Manager

Legal Counsel

Business Development Director

Operations Manager

Compliance Officer

Commercial Director

Brand Manager

Training Manager

Finance Director

Intellectual Property Manager

Regional Development Manager

Quality Assurance Manager

Industries
Government Regulation No. 42 of 2007 on Franchising: The main regulation governing franchising in Indonesia, covering registration requirements, obligations of franchisors and franchisees, and mandatory provisions for franchise agreements
Minister of Trade Regulation No. 71 of 2019: Regulation on franchise implementation, including specific requirements for franchise registration, STPW (Franchise Registration Certificate), and local content requirements
Law No. 20 of 2016 on Marks and Geographical Indications: Governs trademark protection and licensing, crucial for franchise agreements as they typically involve trademark usage rights
Indonesian Civil Code (KUHPerdata): Provides general contract law principles applicable to franchise agreements, including formation, validity, and enforcement of contracts
Law No. 13 of 2003 on Employment: Relevant for provisions regarding employment relationships and worker rights in franchise operations
Law No. 5 of 1999 on Anti-Monopoly and Unfair Business Competition: Addresses competition aspects in franchise agreements, including territorial restrictions and exclusive dealing arrangements
Minister of Trade Regulation No. 57 of 2019: Guidelines on franchise business development, including provisions for franchise business opportunities and partnership arrangements
Law No. 24 of 2019 on Creative Economy: Relevant for franchise businesses in creative sectors, providing framework for intellectual property protection and creative business development
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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