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Installment Sale Agreement for Indonesia

Installment Sale Agreement Template for Indonesia

This document is an Installment Sale Agreement governed by Indonesian law, structured to facilitate the sale of goods where the purchase price is paid in installments over time. It complies with Indonesian Civil Code (KUHPerdata) requirements and relevant regulations from the Financial Services Authority (OJK). The agreement details payment terms, retention of title provisions, delivery conditions, and default remedies while incorporating consumer protection requirements under Indonesian Law No. 8 of 1999. It provides a comprehensive framework for protecting both seller and buyer interests throughout the installment period until full payment is received.

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What is a Installment Sale Agreement?

The Installment Sale Agreement is essential for transactions in Indonesia where goods are sold with payment spread over time through regular installments. This document type is commonly used for high-value purchases such as vehicles, machinery, or equipment, providing a structured payment plan while protecting the seller's interests through retention of title until full payment. It must comply with Indonesian legal requirements, including the Civil Code (KUHPerdata), Consumer Protection Law, and relevant OJK regulations. The agreement typically includes detailed payment schedules, delivery terms, warranty provisions, and default remedies. It's particularly important in both B2B and B2C contexts where immediate full payment is not practical or desired, offering businesses a way to expand their customer base while maintaining security over the sold goods.

What sections should be included in a Installment Sale Agreement?

1. Parties: Identification and details of the Seller and Buyer, including their legal capacity to enter into the agreement

2. Background: Context of the transaction and brief description of the parties' intention to enter into an installment sale arrangement

3. Definitions: Definitions of key terms used throughout the agreement

4. Object of Sale: Detailed description of the goods being sold on installment

5. Purchase Price and Payment Terms: Total purchase price, down payment, installment amounts, payment schedule, and payment methods

6. Delivery and Transfer of Risk: Terms regarding delivery of goods, transfer of risk, and responsibility for transportation

7. Retention of Title: Provisions stating that ownership remains with the seller until full payment is received

8. Buyer's Obligations: Key obligations including making timely payments, maintaining the goods, and obtaining necessary insurance

9. Seller's Obligations: Obligations regarding delivery, warranty, and after-sale service

10. Default and Remedies: Consequences of payment default and other breaches, including repossession rights

11. Termination: Circumstances under which the agreement can be terminated and the consequences

12. Governing Law and Dispute Resolution: Specification of Indonesian law as governing law and dispute resolution mechanisms

13. Notices: Method and addresses for formal communications between parties

14. Miscellaneous: Standard boilerplate provisions including severability, entire agreement, and amendments

What sections are optional to include in a Installment Sale Agreement?

1. Insurance: Detailed insurance requirements when the goods are of high value or require specific insurance coverage

2. Maintenance and Service: For goods requiring regular maintenance or eligible for service packages

3. Extended Warranty: Additional warranty terms beyond standard warranty, typically for electronic or mechanical goods

4. Security Deposit: When additional security beyond the down payment is required

5. Third-Party Rights: When financing is provided by a third-party financial institution

6. Export/Import Provisions: For cross-border transactions involving import/export of goods

7. Installation Services: When the goods require professional installation or setup

8. Training and Support: For complex equipment requiring user training or ongoing technical support

What schedules should be included in a Installment Sale Agreement?

1. Schedule 1 - Product Specifications: Detailed technical specifications and description of the goods

2. Schedule 2 - Payment Schedule: Detailed breakdown of installment payments including dates, amounts, and payment methods

3. Schedule 3 - Delivery Schedule: Timeline and details for delivery of goods

4. Schedule 4 - Warranty Terms: Detailed warranty terms, conditions, and procedures

5. Appendix A - Condition Report: Initial condition report of goods at time of delivery

6. Appendix B - Required Insurance Coverage: Specific insurance requirements and minimum coverage amounts

7. Appendix C - Maintenance Schedule: Required maintenance intervals and procedures

8. Appendix D - Return/Repossession Procedures: Detailed procedures for return or repossession of goods in case of default

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Indonesia

Publisher

Ƶ

Document Type

Sale Agreement

Cost

Free to use
Relevant legal definitions


































Clauses































Relevant Industries

Automotive

Heavy Equipment

Industrial Machinery

Consumer Electronics

Furniture and Home Appliances

Construction Equipment

Agricultural Equipment

Manufacturing

Retail

Technology Hardware

Medical Equipment

Relevant Teams

Legal

Sales

Finance

Credit Control

Commercial

Business Development

Contract Administration

Risk Management

Compliance

Operations

Collections

Customer Service

Relevant Roles

Legal Counsel

Sales Manager

Finance Director

Credit Manager

Commercial Director

Business Development Manager

Contract Administrator

Risk Manager

Compliance Officer

Operations Manager

Chief Financial Officer

Account Executive

Collections Manager

Sales Representative

Customer Service Manager

Industries






Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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