General Partnership Contract Template for Indonesia

A General Partnership Contract under Indonesian law is a comprehensive legal document that establishes a partnership between two or more parties who agree to conduct business together. This agreement is governed by the Indonesian Commercial Code (KUHD) and Civil Code (KUHPerdata), establishing the rights, obligations, and liabilities of all partners. The document outlines capital contributions, profit-sharing arrangements, management responsibilities, and operational procedures while ensuring compliance with Indonesian partnership laws and regulations. It includes provisions for partnership governance, decision-making processes, and procedures for handling various business scenarios including partner admission, withdrawal, and dissolution.

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What is a General Partnership Contract?

The General Partnership Contract is a fundamental document used when two or more parties wish to establish a business partnership in Indonesia. This contract type is particularly important as it creates a legal framework for joint business operations under Indonesian law, specifically regulated by the Commercial Code (KUHD) and Civil Code (KUHPerdata). It's essential when partners want to combine their resources, expertise, and efforts to conduct business while sharing profits and losses. The document addresses crucial aspects such as capital contributions, profit distribution, management rights, partner obligations, and dissolution procedures. Partners in this arrangement typically have unlimited liability for partnership debts, making it crucial to clearly define roles, responsibilities, and risk-sharing mechanisms. The contract must comply with Indonesian registration requirements and may need notarization depending on specific circumstances.

What sections should be included in a General Partnership Contract?

1. Parties: Identification and details of all partners entering the partnership agreement

2. Background: Context of the partnership formation and partners' intentions

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

4. Partnership Formation: Declaration of partnership establishment, name, and effective date

5. Business Purpose: Detailed description of partnership's business activities and objectives

6. Capital Contributions: Initial and ongoing capital contributions from each partner

7. Profit and Loss Sharing: Distribution of profits and allocation of losses among partners

8. Management and Control: Partnership management structure and decision-making processes

9. Rights and Obligations: Detailed rights and responsibilities of all partners

10. Banking and Financial Matters: Banking arrangements and financial management procedures

11. Accounting and Records: Requirements for maintaining financial records and conducting audits

12. Admission of New Partners: Process and conditions for admitting new partners

13. Transfer of Partnership Interest: Rules regarding transfer of partnership shares

14. Withdrawal and Retirement: Procedures for partner withdrawal or retirement

15. Dissolution and Liquidation: Circumstances and procedures for partnership dissolution

16. Dispute Resolution: Methods for resolving disputes between partners

17. Governing Law: Specification of Indonesian law as governing law

18. Notices: Procedures for formal communications between partners

19. General Provisions: Miscellaneous legal provisions including severability and entire agreement

What sections are optional to include in a General Partnership Contract?

1. Intellectual Property Rights: Required when the partnership owns or develops intellectual property

2. Non-Competition: Include when partners agree to restrictions on competing activities

3. Confidentiality: Required when partnership involves sensitive business information

4. Insurance: Include when specific insurance requirements need to be maintained

5. Foreign Investment Provisions: Required when partnership includes foreign partners

6. Environmental Compliance: Include for partnerships in industries with environmental impacts

7. Employee Management: Required when partnership will have employees

8. Property Ownership: Include when partnership will own or lease property

What schedules should be included in a General Partnership Contract?

1. Schedule A - Capital Contributions: Detailed breakdown of each partner's initial and committed capital contributions

2. Schedule B - Profit Sharing Ratios: Specific percentages and formulas for profit and loss distribution

3. Schedule C - Partner Information: Detailed information about each partner including contact details and representatives

4. Schedule D - Business Plan: Initial business plan and strategic objectives

5. Schedule E - Partnership Assets: List of assets contributed to or owned by the partnership

6. Appendix 1 - Management Procedures: Detailed procedures for partnership management and decision-making

7. Appendix 2 - Banking Arrangements: Details of banking procedures and authorized signatories

8. Appendix 3 - Accounting Policies: Specific accounting policies and procedures to be followed

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

Jurisdiction

Indonesia

Publisher

Genie AI

Cost

Free to use

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