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The Toll Manufacturing Agreement is essential for businesses seeking to outsource their manufacturing operations in Indonesia while maintaining control over their product specifications and intellectual property. This contract type is particularly relevant when companies want to leverage existing manufacturing facilities and expertise without significant capital investment in production infrastructure. The agreement must comply with Indonesian regulations, including industrial licensing requirements, labor laws, and investment regulations. It typically includes detailed provisions for quality control, manufacturing processes, material handling, regulatory compliance, and risk allocation. This document is commonly used across various industries where specialized manufacturing capabilities are required, and it helps establish clear responsibilities and expectations between the principal company and the toll manufacturer.

1. Parties: Identification of the Principal and the Manufacturer with their complete legal details

2. Background: Context of the agreement, including brief description of parties' businesses and purpose of the arrangement

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

4. Scope of Services: Detailed description of manufacturing services to be provided

5. Supply of Materials: Terms regarding the supply, delivery, and handling of raw materials

6. Manufacturing Process: Requirements for production process, including compliance with specifications

7. Quality Control: Quality standards, testing procedures, and acceptance criteria

8. Delivery and Logistics: Terms for product delivery, packaging, and transportation

9. Pricing and Payment: Manufacturing fees, payment terms, and related financial provisions

10. Intellectual Property Rights: Protection and ownership of IP, including manufacturing processes and final products

11. Confidentiality: Protection of confidential information and trade secrets

12. Representations and Warranties: Parties' warranties regarding capacity, quality, and compliance

13. Liability and Indemnification: Allocation of risks and responsibilities between parties

14. Term and Termination: Duration of agreement and grounds for termination

15. Force Majeure: Provisions for handling unforeseen circumstances

16. Governing Law and Dispute Resolution: Choice of law and dispute resolution mechanisms

17. General Provisions: Standard boilerplate clauses including notices, amendments, and assignment