License Transfer Agreement Template for Indonesia

A License Transfer Agreement is a legally binding contract that facilitates the formal transfer of license rights between parties in Indonesia. This document ensures that intellectual property rights, technology licenses, or business permits are transferred in compliance with Indonesian regulations while protecting the interests of both the transferor and transferee.

When do you need this document?

You need a License Transfer Agreement when your business undergoes restructuring and licenses must be transferred to new entities, when acquiring or merging with companies that hold valuable licenses, or when selling specific business divisions along with their associated licensing rights. This document is also essential when technology companies transfer software or patent licenses to subsidiaries, when franchise agreements change ownership, or when regulatory licenses need to be transferred due to corporate changes. Indonesian businesses frequently use this agreement during foreign investment transactions where international companies transfer local licenses to comply with ownership requirements.

Key legal considerations

The agreement must clearly identify all transferred rights and any retained rights by the original licensor, specify whether the transfer includes existing sub-licensing arrangements, and define the geographical scope and duration of the transferred license. You must address payment obligations, including any outstanding fees or royalties, and establish warranties regarding the validity and enforceability of the transferred license. The document should include provisions for regulatory approval requirements and specify procedures for notifying relevant Indonesian authorities. Consider including termination clauses that protect both parties if registration requirements are not met, and ensure the agreement addresses any ongoing obligations to third parties or regulatory bodies.

Legal requirements in Indonesia

Under Indonesian law, license transfers must comply with the Civil Code's contract formation requirements, including proper offer, acceptance, and consideration. Patent license transfers require registration with the Indonesian Intellectual Property Office under Law No. 13 of 2016, while trademark license transfers must be registered according to Law No. 20 of 2016. Copyright transfers fall under Law No. 28 of 2014 and may require specific documentation depending on the type of copyrighted material. The agreement must be executed in Indonesian language or accompanied by certified translations, and certain license types require approval from relevant ministries or regulatory bodies. You must ensure compliance with foreign investment regulations if the transfer involves international parties, and consider tax implications under Indonesian transfer pricing rules. The document should be notarized and may require legalization depending on the parties involved and the nature of the licensed rights.