The Master Subcontract Agreement serves as a foundational document for companies operating in Indonesia who regularly engage subcontractors for various projects or services. This agreement type is particularly important given Indonesia's specific regulatory requirements for subcontracting relationships, including compliance with Law No. 13 of 2003 on Manpower and Minister of Manpower Regulation No. 19 of 2012. The document establishes a framework that can be efficiently used for multiple projects through individual work orders, reducing the need for repeated contract negotiations while ensuring consistency in terms and compliance. It includes comprehensive provisions for risk allocation, performance standards, and dispute resolution, while incorporating specific Indonesian legal requirements for areas such as labor rights, local content, and business permissions.
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1. Parties: Identification of the main contractor and subcontractor, including full legal names, registration numbers, and addresses
2. Background: Context of the agreement, relationship between parties, and general purpose of the master agreement
3. Definitions and Interpretation: Definitions of key terms, interpretation rules, and hierarchy of documents
4. Scope of Agreement: Framework terms for subcontracting relationship, types of work covered, and geographical scope
5. Engagement Process: Procedures for engaging subcontractor for specific projects, including work orders and acceptance process
6. Subcontractor Obligations: Core obligations, compliance requirements, warranties, and performance standards
7. Main Contractor Obligations: Main contractor's responsibilities, including provision of information and access
8. Personnel Requirements: Qualifications, training, supervision, and compliance with labor laws
9. Pricing and Payment: Payment terms, invoicing procedures, and price adjustment mechanisms
10. Quality and Performance: Quality standards, KPIs, monitoring, and reporting requirements
11. Health, Safety and Environment: HSE requirements, compliance with regulations, and reporting obligations
12. Insurance and Liability: Required insurance coverage, liability provisions, and indemnification
13. Intellectual Property: IP rights, licenses, and protection of proprietary information
14. Confidentiality: Protection and handling of confidential information
15. Term and Termination: Duration, renewal, termination rights, and consequences of termination
16. Force Majeure: Force majeure events and consequences
17. Dispute Resolution: Dispute resolution procedures, governing law, and jurisdiction
18. General Provisions: Standard boilerplate clauses including notices, amendments, and entire agreement
1. Anti-Bribery and Corruption: Specific provisions for anti-corruption compliance, recommended for international contracts or high-value agreements
2. Data Protection: Provisions for handling personal data, required if personal data processing is involved
3. Export Control: Export control compliance provisions, needed for international operations or controlled goods
4. Local Content Requirements: Provisions addressing Indonesian local content requirements, needed for certain industries
5. Parent Company Guarantee: Requirements for parent company guarantees, recommended for high-value contracts or less established subcontractors
6. Step-in Rights: Main contractor's right to step in and take over subcontractor's scope, recommended for critical services
7. Sustainability Requirements: Environmental and social sustainability obligations, relevant for environmentally sensitive projects
8. Technology Transfer: Provisions for technology transfer to local resources, relevant for technical services or government requirements
1. Schedule 1 - Pricing Schedule: Detailed pricing structure, rates, and payment terms
2. Schedule 2 - Scope of Services: Detailed description of services/works that may be subcontracted
3. Schedule 3 - Technical Standards: Technical specifications and performance standards
4. Schedule 4 - KPIs and Performance Metrics: Detailed performance indicators and measurement criteria
5. Schedule 5 - HSE Requirements: Detailed health, safety, and environmental requirements
6. Schedule 6 - Form of Work Order: Template for individual work orders under the master agreement
7. Schedule 7 - Insurance Requirements: Detailed insurance requirements and minimum coverage
8. Schedule 8 - Required Personnel and Qualifications: List of key positions and required qualifications
9. Appendix A - Compliance Certificates: Required statutory and regulatory compliance certificates
10. Appendix B - Form of Parent Company Guarantee: Template for parent company guarantee if required
11. Appendix C - Form of Performance Bond: Template for performance bond if required
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