The Product Supply Agreement serves as a foundational document for establishing and managing commercial supply relationships in Indonesia. It is particularly important for businesses engaged in regular supply arrangements, whether domestic or international, that require a structured framework for their trading relationship. The agreement must comply with Indonesian legal requirements, including the Civil Code (Kitab Undang-undang Hukum Perdata), Trade Law No. 7 of 2014, and Consumer Protection Law No. 8 of 1999. This document is essential when parties need to formalize their supply arrangements, establish clear quality and delivery standards, set pricing mechanisms, and define their respective rights and obligations. It typically includes detailed provisions on product specifications, ordering processes, quality control, warranties, risk allocation, and dispute resolution mechanisms, all tailored to meet Indonesian regulatory requirements while facilitating efficient business operations.
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1. Parties: Identification of supplier and buyer, including complete legal names, registration numbers, and addresses
2. Background: Context of the agreement, business relationship, and general purpose
3. Definitions: Definitions of key terms used throughout the agreement
4. Supply Obligations: Core obligations of the supplier, including product quality, quantity, and delivery requirements
5. Ordering Process: Procedures for placing and accepting orders, including lead times and minimum order quantities
6. Price and Payment: Product pricing, payment terms, invoicing procedures, and currency specifications
7. Delivery and Risk: Delivery terms, transfer of risk, shipping requirements, and Incoterms
8. Quality and Inspection: Quality standards, inspection rights, acceptance/rejection procedures
9. Warranties: Product warranties, quality guarantees, and remedy for defective products
10. Term and Termination: Duration of agreement, renewal terms, and termination rights
11. Confidentiality: Protection of confidential information and trade secrets
12. Force Majeure: Events excusing performance and related procedures
13. Dispute Resolution: Process for resolving disputes, choice of law, and jurisdiction
14. General Provisions: Standard boilerplate clauses including notices, amendments, and assignment
1. Exclusivity: Used when parties want to establish exclusive supply arrangements
2. Minimum Purchase Commitments: Include when buyer commits to minimum purchase volumes
3. Storage and Warehousing: Required if supplier provides storage services
4. Insurance Requirements: Detailed insurance obligations beyond standard coverage
5. Intellectual Property: Include when products involve branded items or licensed technology
6. Compliance with Laws: Detailed compliance obligations for regulated products
7. Environmental Requirements: Include for products with environmental impact or regulations
8. Product Development: Used when parties collaborate on product improvements
9. Marketing and Promotion: Include if supplier has marketing obligations
10. Training and Support: Required if supplier provides technical support or training
1. Product Specifications: Detailed technical specifications of products
2. Pricing Schedule: Price list, discount structures, and pricing adjustment mechanisms
3. Service Levels: Detailed performance metrics and service level requirements
4. Quality Standards: Specific quality requirements and testing procedures
5. Delivery Locations: List of approved delivery locations and specific requirements
6. Key Personnel: Contact details for key personnel from both parties
7. Form of Purchase Order: Standard form for placing orders
8. Compliance Certificates: Required regulatory certifications and compliance documents
9. Return Procedures: Detailed procedures for product returns and replacements
10. Reporting Requirements: Templates and procedures for required reporting
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