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Royalty License Agreement

Royalty License Agreement Template for Indonesia

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Key Requirements PROMPT example:

Royalty License Agreement

"I need a Royalty License Agreement under Indonesian law for licensing our patented manufacturing process to a local Indonesian company, with quarterly royalty payments of 5% of net sales and a minimum annual guarantee of USD 100,000, starting from March 2025."

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Document background
The Royalty License Agreement serves as a crucial legal instrument in Indonesia's intellectual property landscape, providing a framework for commercializing IP rights while ensuring compliance with local regulations. This document is essential when one party (licensor) wishes to grant another party (licensee) the right to use specific intellectual property while maintaining ownership and receiving compensation through royalties. It is particularly relevant given Indonesia's growing focus on IP protection and technology transfer, as evidenced by recent legislation including Law No. 24 of 2019 on Creative Economy and various IP-specific regulations. The agreement must navigate both Indonesian mandatory provisions and international best practices, especially when dealing with cross-border licensing arrangements. It typically includes detailed provisions on royalty calculations, payment mechanisms, quality control, regulatory compliance, and dispute resolution, all within the context of Indonesian law.
Suggested Sections

1. Parties: Identification and details of the licensor and licensee, including registration numbers and addresses

2. Background: Context of the agreement, brief description of the intellectual property, and purpose of the licensing arrangement

3. Definitions: Detailed definitions of key terms used throughout the agreement, including technical terms and calculation methods

4. Grant of License: Scope of the license, including territory, exclusivity, and permitted uses

5. Royalty Payments: Detailed structure of royalty calculations, payment terms, currency, and payment methods

6. Reporting and Audit Rights: Requirements for financial reporting, record-keeping, and audit procedures

7. Intellectual Property Rights: Confirmation of ownership, protection obligations, and handling of improvements

8. Quality Control: Standards maintenance, inspection rights, and quality assurance requirements

9. Term and Termination: Duration of the agreement, renewal terms, and termination circumstances

10. Confidentiality: Protection of confidential information and trade secrets

11. Representations and Warranties: Standard warranties regarding IP ownership, authority to license, and non-infringement

12. Indemnification: Mutual indemnification obligations and liability limitations

13. Governing Law and Dispute Resolution: Choice of law, jurisdiction, and dispute resolution mechanisms

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

Optional Sections

1. Minimum Guarantee: Used when the agreement includes minimum royalty payment requirements

2. Sublicensing Rights: Include when licensee is permitted to sublicense the intellectual property

3. Technology Transfer: Required for agreements involving technical knowledge transfer or training

4. Marketing and Promotion: Include when specific marketing obligations or restrictions apply

5. Export Control: Necessary for international licensing arrangements

6. Non-Competition: Include when restricting licensee's competitive activities

7. Bank Guarantee: Used when financial security is required

8. Force Majeure: Detailed force majeure provisions beyond standard clause, particularly relevant post-COVID

9. Local Content Requirements: Include when required by Indonesian regulations for specific industries

Suggested Schedules

1. Schedule A - Licensed Intellectual Property: Detailed description of the licensed IP, including registration numbers

2. Schedule B - Royalty Calculation Methods: Detailed formulas and examples of royalty calculations

3. Schedule C - Territory: Detailed description of geographic scope and any territorial restrictions

4. Schedule D - Quality Standards: Specific quality requirements and testing procedures

5. Schedule E - Reporting Templates: Standard forms for financial and operational reporting

6. Schedule F - Technical Specifications: Detailed technical requirements and standards

7. Appendix 1 - Approved Sub-contractors: List of pre-approved sub-contractors if applicable

8. Appendix 2 - Trademark Usage Guidelines: Specific requirements for using licensed trademarks

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok成人版 | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

alex.den.21@genieai.co
Relevant legal definitions









































Clauses









































Relevant Industries

Technology and Software

Manufacturing

Consumer Goods

Pharmaceuticals

Media and Entertainment

Telecommunications

Fashion and Retail

Food and Beverage

Automotive

Electronics

Biotechnology

Industrial Design

Creative Industries

Research and Development

Energy

Relevant Teams

Legal

Intellectual Property

Finance

Business Development

Commercial

Research and Development

Compliance

Operations

Technology

Risk Management

International Business

Corporate Affairs

Relevant Roles

Legal Counsel

Intellectual Property Manager

Licensing Director

Business Development Manager

Chief Technology Officer

Finance Director

Compliance Officer

Contract Manager

Commercial Director

IP Rights Administrator

Technology Transfer Officer

Risk Management Officer

Chief Financial Officer

Operations Director

Research and Development Director

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, 聽Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination, 聽Severance Pay, Governing Law, Entire Agreemen

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