Document background
A Letter of Intent to Purchase Goods is commonly used in Indonesian business transactions as a preliminary step before entering into a final purchase agreement. It is particularly valuable when dealing with significant purchases that require detailed negotiation, due diligence, or regulatory approval. The document typically includes proposed commercial terms, timelines, due diligence requirements, and any conditions precedent to the final purchase. While governed by Indonesian law, particularly the Civil Code (KUHPerdata) and Law No. 7 of 2014 on Trade, most provisions are non-binding except for specific clauses like confidentiality and exclusivity. This document is essential in establishing serious intent and providing a structured framework for negotiations, especially important in Indonesian business culture where formal expressions of intent are highly valued.
