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.
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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
1. Exclusivity: Used when parties agree to exclusive manufacturing arrangement
2. Equipment Provision: Included when specific manufacturing equipment is provided by the Principal
3. Technology Transfer: Required when manufacturing involves transfer of technical knowledge
4. Minimum Purchase Commitments: Used when Principal commits to minimum order volumes
5. Environmental Compliance: Detailed section when manufacturing involves significant environmental considerations
6. Staff Training: Included when specific training requirements exist for manufacturing personnel
7. Insurance Requirements: Detailed insurance provisions beyond standard liability coverage
8. Security Requirements: Used when manufacturing involves sensitive products or processes
1. Manufacturing Specifications: Detailed technical specifications for the manufacturing process
2. Quality Standards and Testing Procedures: Specific quality control requirements and testing protocols
3. Pricing Schedule: Detailed breakdown of manufacturing costs and pricing structure
4. Raw Materials Specifications: Technical requirements for raw materials
5. Equipment Specifications: Details of manufacturing equipment to be used
6. Key Performance Indicators: Metrics for measuring manufacturing performance
7. Compliance Certificates: Required regulatory and quality certifications
8. Standard Operating Procedures: Detailed manufacturing and handling procedures
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