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Purchase Agency Agreement for Indonesia

Purchase Agency Agreement Template for Indonesia

A comprehensive legal agreement governed by Indonesian law that establishes and regulates the relationship between a principal and their appointed purchase agent. The agreement outlines the agent's authority to make purchases on behalf of the principal within specified parameters, including territorial scope, commission structures, and operational procedures. It incorporates specific requirements under Indonesian commercial law, including relevant provisions from the Indonesian Civil Code and Commercial Code, while addressing key aspects such as agency obligations, liability limitations, and compliance with local regulations. The document ensures clear delineation of responsibilities while protecting both parties' interests in accordance with Indonesian legal requirements.

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What is a Purchase Agency Agreement?

The Purchase Agency Agreement is a vital commercial document used when a company (principal) wishes to appoint an agent to handle purchasing activities in Indonesia. This agreement is particularly relevant for international companies seeking to establish a local purchasing presence in Indonesia, or for Indonesian companies structuring their procurement relationships. The document addresses key aspects required under Indonesian law, including agency appointment, scope of authority, territorial restrictions, and commission structures. It ensures compliance with local regulations while providing a clear framework for the agency relationship. The agreement typically includes detailed provisions on purchase procedures, reporting requirements, performance standards, and termination rights, all structured in accordance with Indonesian legal requirements and commercial practices. This type of agreement is essential for companies looking to outsource their procurement activities while maintaining control over purchasing decisions and ensuring proper representation in the Indonesian market.

What sections should be included in a Purchase Agency Agreement?

1. Parties: Identification of the Principal and the Agent, including full legal names, registration numbers, and registered addresses

2. Background: Context of the agreement, including the Principal's business, the Agent's qualifications, and the purpose of the agency relationship

3. Definitions and Interpretation: Definitions of key terms used in the agreement and rules for interpreting the agreement

4. Appointment and Scope: Formal appointment of the Agent, territory coverage, and scope of authority

5. Agent's Rights and Obligations: Detailed responsibilities of the Agent, including purchase procedures, reporting requirements, and performance standards

6. Principal's Rights and Obligations: Principal's commitments, including support, information provision, and payment terms

7. Commission Structure: Details of commission calculations, payment terms, and any performance-based incentives

8. Term and Termination: Duration of the agreement and circumstances under which it can be terminated

9. Confidentiality: Obligations regarding confidential information and trade secrets

10. Intellectual Property: Protection and usage rights of trademarks, logos, and other IP

11. Compliance with Laws: Obligations to comply with Indonesian laws and regulations

12. Dispute Resolution: Procedures for resolving disputes, including jurisdiction and governing law

13. General Provisions: Standard clauses including notices, amendments, and entire agreement

What sections are optional to include in a Purchase Agency Agreement?

1. Non-Competition: Restrictions on Agent's ability to represent competing products or services - include when exclusivity is required

2. Insurance: Requirements for insurance coverage - include when dealing with high-value products or specific risks

3. Performance Targets: Specific sales or purchase targets - include when performance metrics are crucial

4. Training and Support: Details of training provided by Principal - include when technical products or specific knowledge is required

5. Sub-Agents: Rights and procedures for appointing sub-agents - include when sub-delegation may be necessary

6. Force Majeure: Provisions for unforeseen circumstances - include when long-term or high-value relationship

7. Data Protection: Specific data handling requirements - include when personal or sensitive data is involved

8. Anti-Corruption: Specific anti-corruption provisions - include when dealing with government or high-risk sectors

What schedules should be included in a Purchase Agency Agreement?

1. Schedule 1 - Territory: Detailed description of geographical area covered by the agency

2. Schedule 2 - Products: List and specifications of products covered by the agreement

3. Schedule 3 - Commission Structure: Detailed breakdown of commission rates, calculations, and examples

4. Schedule 4 - Operating Procedures: Step-by-step procedures for purchase orders, approvals, and reporting

5. Schedule 5 - Performance Metrics: Detailed KPIs and measurement criteria

6. Schedule 6 - Approved Sub-Agents: List of pre-approved sub-agents if applicable

7. Appendix A - Required Forms: Standard forms for purchase orders, reports, and other documentation

8. Appendix B - Brand Guidelines: Guidelines for use of Principal's branding and marketing materials

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

Agency Agreement

Cost

Free to use
Relevant legal definitions








































Clauses









































Relevant Industries

Manufacturing

Textiles

Electronics

Agriculture

Mining

Consumer Goods

Industrial Equipment

Automotive

Chemical Products

Food and Beverage

Construction Materials

Pharmaceuticals

Commodities Trading

Retail

Technology

Relevant Teams

Legal

Procurement

Supply Chain

Commercial

Operations

Risk and Compliance

Finance

Business Development

Vendor Management

Contract Administration

Relevant Roles

Procurement Manager

Commercial Director

Supply Chain Manager

Legal Counsel

Purchasing Director

Contract Manager

Chief Procurement Officer

Business Development Manager

Operations Director

Sourcing Manager

Vendor Relations Manager

Regional Procurement Head

Commercial Manager

Risk Manager

Compliance Officer

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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