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Sole Agency Agreement for Indonesia

Sole Agency Agreement Template for Indonesia

A comprehensive legal agreement governed by Indonesian law that establishes an exclusive agency relationship between a principal company and their appointed agent. The agreement grants the agent exclusive rights to promote, sell, or distribute the principal's products or services within a defined territory in Indonesia. It includes detailed provisions on commission structures, performance requirements, territorial restrictions, and compliance with local regulations. The document addresses specific Indonesian legal requirements, including relevant provisions from the Civil Code (KUHPer) and commercial regulations governing agency relationships.

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What is a Sole Agency Agreement?

The Sole Agency Agreement is a crucial document for businesses seeking to establish exclusive distribution channels in Indonesia. It is particularly relevant for foreign companies wanting to enter the Indonesian market through a local representative, or for domestic companies establishing exclusive distribution arrangements. The agreement must comply with Indonesian legal requirements, including the Civil Code (KUHPer), trade regulations, and specific agency laws. The document typically includes comprehensive terms covering appointment, territory definition, commission structures, performance targets, and termination provisions. It's essential for protecting both parties' interests while ensuring compliance with local regulatory requirements, including any necessary registrations with the Ministry of Trade. The Sole Agency Agreement is particularly important given Indonesia's complex distribution networks and the legal requirement for certain business activities to be conducted through local entities.

What sections should be included in a Sole Agency Agreement?

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

2. Background: Context of the agreement, including the Principal's business, the Agent's qualifications, and the intention to establish an exclusive agency relationship

3. Definitions: Key terms used throughout the agreement, including Territory, Products, Intellectual Property Rights, and other relevant definitions

4. Appointment and Scope: Express appointment of the Agent as the sole and exclusive agent, defining the territory and scope of authority

5. Term: Duration of the agreement, including commencement date and renewal provisions

6. Agent's Rights and Obligations: Detailed responsibilities of the Agent, including promotion, reporting, and compliance requirements

7. Principal's Rights and Obligations: Principal's commitments, including product supply, support, and training obligations

8. Commission and Payment Terms: Structure of commission, calculation method, payment terms, and currency

9. Intellectual Property: Usage rights and restrictions regarding the Principal's trademarks, logos, and other IP

10. Confidentiality: Protection of confidential information exchanged during the agency relationship

11. Termination: Grounds for termination, notice requirements, and consequences of termination

12. Post-Termination: Obligations and rights of both parties after agreement termination

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

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

1. Performance Targets: Specific sales or performance targets, used when the Principal wants to set measurable objectives

2. Sub-Agents: Terms for appointing sub-agents, if permitted by the Principal

3. Insurance: Insurance requirements, when specific coverage is needed for high-value products or services

4. Bank Guarantee: Requirements for bank guarantees or other financial security, used for high-value agreements

5. Training and Support: Detailed training obligations, when products require specific technical knowledge

6. Marketing and Promotion: Specific marketing requirements and cost-sharing arrangements, for agreements with significant promotional activities

7. Force Majeure: Extended force majeure provisions, particularly relevant in uncertain market conditions

8. Compliance with Anti-Corruption Laws: Detailed anti-corruption provisions, especially important when dealing with government contracts or highly regulated industries

What schedules should be included in a Sole Agency Agreement?

1. Schedule 1 - Products: Detailed list of products or services covered by the agency agreement

2. Schedule 2 - Territory: Detailed description of the geographical territory, including any excluded areas

3. Schedule 3 - Commission Structure: Detailed commission calculations, including any variations by product or customer type

4. Schedule 4 - Performance Targets: Specific sales targets and performance metrics

5. Schedule 5 - Trademark Usage Guidelines: Guidelines for using the Principal's trademarks and branding

6. Schedule 6 - Reporting Templates: Standard forms for regular reporting requirements

7. Appendix A - Required Certifications: List of required regulatory certifications or permits

8. Appendix B - Standard Operating Procedures: Key operational procedures and compliance requirements

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

Consumer Goods

Automotive

Electronics

Pharmaceuticals

Industrial Equipment

Luxury Goods

Technology

Medical Devices

Chemicals

Construction Materials

Agricultural Products

Telecommunications

Relevant Teams

Legal

Commercial

Sales

Business Development

Operations

Compliance

International Trade

Distribution

Channel Management

Executive Leadership

Regulatory Affairs

Relevant Roles

Commercial Director

Business Development Manager

Legal Counsel

Contracts Manager

Sales Director

Country Manager

Distribution Manager

Channel Manager

Compliance Officer

Chief Executive Officer

Managing Director

Operations Director

Regional Sales Manager

Import/Export Manager

Regulatory Affairs 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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