Master Franchise Contract Template for Indonesia

The Master Franchise Contract serves as the foundational agreement for expanding franchise operations in Indonesia, typically used when a franchise brand wants to develop its presence across the Indonesian market through a local partner. This document must comply with Indonesian franchise regulations, particularly Government Regulation No. 42 of 2007 and Ministry of Trade requirements, including mandatory provisions for local content, registration with authorities, and specific disclosure obligations. The agreement covers comprehensive aspects of the franchise relationship, including development rights, territorial exclusivity, sub-franchising procedures, fee structures, training requirements, and quality control mechanisms. It's essential for businesses seeking to establish a significant presence in Indonesia while ensuring compliance with local franchise laws and protecting their intellectual property rights.

1. Parties: Identification of the Franchisor and Master Franchisee, including complete legal names and addresses

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

3. Definitions: Comprehensive definitions of terms used throughout the agreement

4. Grant of Rights: Scope of master franchise rights, territorial exclusivity, and sub-franchising rights

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

6. Fees and Payments: Initial fees, ongoing royalties, advertising contributions, and payment terms

7. Obligations of the Franchisor: Support, training, manual provision, and ongoing assistance requirements

8. Obligations of the Master Franchisee: Development schedule, compliance requirements, reporting obligations, and local content requirements

9. Sub-Franchising Rights: Terms and conditions for granting sub-franchises, including approval processes

10. Intellectual Property: Usage rights and protection of trademarks, trade secrets, and other IP

11. Quality Control: Standards maintenance, inspection rights, and compliance requirements

12. Financial Records: Record-keeping requirements, audit rights, and reporting obligations

13. Marketing and Advertising: Marketing requirements, advertising fund management, and local marketing obligations

14. Confidentiality: Protection of confidential information and trade secrets

15. Non-Competition: Competition restrictions during and after the agreement term

16. Termination: Grounds for termination, procedures, and consequences

17. Post-Termination: Obligations and rights after agreement termination

18. Governing Law and Dispute Resolution: Choice of law, jurisdiction, and dispute resolution mechanisms

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