Non Exclusive License Agreement Template for Indonesia

A Non Exclusive License Agreement allows you to grant or obtain intellectual property rights while preserving the ability to license the same IP to multiple parties. Unlike exclusive licenses, this arrangement gives you flexibility as a licensor to work with several licensees simultaneously, or as a licensee to access valuable IP without preventing the owner from licensing to others. This document type is fundamental for businesses operating in Indonesia's competitive market where IP commercialization drives innovation and growth.

When do you need this document?

You need a Non Exclusive License Agreement when entering technology transfer arrangements, software licensing deals, or franchise operations in Indonesia. This document becomes essential when foreign companies want to license their technology to Indonesian manufacturers, when software developers distribute products through multiple local partners, or when trademark owners expand their brand presence through various distributors. The agreement is also crucial for research collaborations between universities and private companies, licensing of manufacturing processes across different industries, and distribution arrangements for copyrighted content like music, films, or publications.

Key legal considerations

Your agreement must clearly define the scope of licensed rights, territorial limitations, and permitted uses to avoid disputes. Include specific quality control provisions to protect the licensor's reputation and ensure compliance with Indonesian standards. Address payment terms carefully, including upfront fees, ongoing royalties, and currency exchange considerations for international transactions. Consider sub-licensing rights, as these can significantly impact your business strategy and require careful regulation under Indonesian competition law. Include termination clauses that protect both parties' interests while ensuring smooth business transitions, and specify dispute resolution mechanisms that align with Indonesian legal procedures.

Legal requirements in Indonesia

Your Non Exclusive License Agreement must comply with Indonesian Civil Code contract formation requirements, including clear offer, acceptance, and consideration elements. Register the agreement with relevant authorities under Government Regulation No. 36 of 2018 if it involves patents, trademarks, or industrial designs. Ensure compliance with Law No. 5 of 1999 on Prohibition of Monopolistic Practices, particularly regarding territorial restrictions and pricing arrangements. Foreign licensors must consider Indonesian Investment Coordinating Board (BKPM) requirements for technology transfer agreements. Include provisions for Indonesian language translation and local legal representation when required. Address tax obligations under Indonesian law, including withholding taxes on royalty payments and VAT considerations for licensing services.