A Production License Agreement is essential when a company wishes to manufacture products using another company's intellectual property or technology in Indonesia. This document is particularly important given Indonesia's specific regulatory requirements for technology transfer, local content, and industrial licensing. The agreement must comply with various Indonesian laws, including patent legislation, industrial regulations, and investment laws. It typically includes detailed provisions for production specifications, quality control, technical support, and royalty calculations. The Production License Agreement is commonly used in manufacturing arrangements where the licensor provides technology or know-how to an Indonesian manufacturer, or when a foreign company seeks to establish local production operations through a licensed Indonesian partner.
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1. Parties: Identification of the Licensor and Licensee, including their complete legal details and addresses
2. Background: Context of the agreement, including brief description of the licensed technology/product and parties' authority to enter into the agreement
3. Definitions: Detailed definitions of technical terms, licensed products, territory, and other key terms used in the agreement
4. Grant of License: Scope of the license, including type (exclusive/non-exclusive), territory, and permitted activities
5. Technical Information and Support: Details of technical documentation, know-how, and support to be provided by licensor
6. Production Requirements: Specific requirements for production, quality standards, and production capacity
7. Quality Control: Quality assurance measures, inspection rights, and compliance with standards
8. Intellectual Property Rights: Protection of IP rights, ownership of improvements, and infringement procedures
9. Financial Terms: License fees, royalties, payment terms, and calculation methods
10. Compliance: Compliance with Indonesian laws, regulations, and reporting requirements
11. Term and Termination: Duration of agreement, renewal terms, and termination conditions
12. Dispute Resolution: Governing law, jurisdiction, and dispute resolution procedures under Indonesian law
1. Environmental Compliance: Required if production involves environmental impacts or hazardous materials
2. Export Controls: Necessary if products may be exported outside Indonesia
3. Training Provisions: Include if technical training is required for production staff
4. Research and Development: Include if parties will collaborate on product improvements
5. Marketing Rights: Include if licensee has rights to market the products
6. Sub-licensing Rights: Include if sub-licensing is permitted
7. Local Content Requirements: Required if subject to Indonesian local content regulations
1. Schedule 1 - Licensed Products: Detailed specifications of products covered by the license
2. Schedule 2 - Technical Specifications: Detailed technical requirements and production specifications
3. Schedule 3 - Quality Standards: Quality control procedures and acceptance criteria
4. Schedule 4 - Royalty Calculations: Detailed method for calculating royalties and examples
5. Schedule 5 - Technical Documentation: List of technical documents to be provided by licensor
6. Appendix A - Production Facility Requirements: Specifications for production facilities and equipment
7. Appendix B - Training Program: Details of technical training program if applicable
8. Appendix C - Reporting Templates: Standard forms for production and sales reporting
Relevant legal definitions
Clauses
Relevant Industries
Manufacturing
Automotive
Electronics
Pharmaceuticals
Consumer Goods
Industrial Equipment
Food and Beverage
Textiles
Chemical Production
Technology Hardware
Medical Devices
Agricultural Processing
Relevant Teams
Legal
Operations
Manufacturing
Quality Assurance
Research & Development
Compliance
Technical Operations
Intellectual Property
Production
Business Development
Contract Management
Relevant Roles
Chief Technology Officer
Manufacturing Director
Production Manager
Quality Control Manager
Legal Counsel
Intellectual Property Manager
Operations Director
Compliance Officer
Technical Director
Business Development Manager
Contract Manager
Chief Operating Officer
Licensing Manager
Factory Manager
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