Perpetual Royalty License Template for Indonesia

The Perpetual Royalty License agreement is essential for businesses seeking to establish long-term intellectual property licensing arrangements in Indonesia. This document is particularly relevant when a rights owner wishes to grant permanent usage rights while maintaining a continuous revenue stream through royalty payments. The agreement must comply with Indonesian legal requirements, including the Civil Code (Kitab Undang-undang Hukum Perdata), Law No. 28 of 2014 on Copyright, and other relevant IP regulations. It's commonly used in technology transfer, manufacturing licenses, brand licensing, and similar arrangements where ongoing commercialization of intellectual property is intended. The perpetual nature of the license requires careful consideration of quality control measures, reporting mechanisms, and protection of the licensed rights throughout the agreement's unlimited duration.

1. Parties: Identification of the licensor and licensee, including their legal status and registered addresses

2. Background: Context of the agreement, description of the intellectual property, and parties' authority to enter into the agreement

3. Definitions: Detailed definitions of key terms used throughout the agreement, including 'Licensed Property', 'Territory', 'Royalties', and 'Net Sales'

4. Grant of Rights: Explicit description of the rights being licensed, including scope, territory, and confirmation of perpetual nature

5. Royalty Obligations: Detailed structure of royalty calculations, payment terms, reporting requirements, and audit rights

6. Quality Control: Standards for use of the licensed property and quality maintenance requirements

7. Representations and Warranties: Statements regarding ownership, right to license, non-infringement, and other key assurances

8. Protection of Rights: Obligations regarding protection and enforcement of the licensed rights

9. Confidentiality: Provisions for protecting confidential information exchanged under the agreement

10. Record Keeping and Audit: Requirements for maintaining records and allowing audits of royalty calculations

11. Indemnification: Mutual indemnification obligations and procedures

12. Limited Termination Rights: Specific circumstances under which the perpetual license may be terminated (e.g., material breach, insolvency)

13. Governing Law and Jurisdiction: Specification of Indonesian law as governing law and choice of forum for dispute resolution

14. General Provisions: Standard boilerplate clauses including notices, amendment procedures, and severability