The Vendors Agreement is a crucial commercial document used to establish formal business relationships with suppliers in Indonesia. It is designed to protect both parties' interests while ensuring compliance with Indonesian laws and regulations, including the Civil Code (Kitab Undang-undang Hukum Perdata) and Law No. 7 of 2014 on Trade. This agreement is essential when engaging suppliers for regular or significant provision of goods or services, setting out clear terms on pricing, delivery, quality standards, and performance requirements. It includes specific provisions for dispute resolution under Indonesian law and typically incorporates local business practices and customs. The document is particularly important for businesses operating in Indonesia's dynamic market environment, where clear vendor relationships and compliance with local regulations are crucial for successful operations.
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1. Parties: Identification of the contracting parties with complete legal names, registration numbers, and addresses
2. Background: Context of the agreement, relationship between parties, and general purpose of the vendor arrangement
3. Definitions and Interpretation: Definitions of key terms and interpretation rules for the agreement
4. Scope of Services/Supply: Detailed description of goods/services to be provided by the vendor
5. Term and Renewal: Duration of the agreement and conditions for renewal
6. Pricing and Payment Terms: Price structure, payment schedule, invoicing requirements, and tax considerations
7. Delivery and Performance: Delivery terms, timelines, and performance standards
8. Quality Requirements: Quality standards, specifications, and compliance requirements
9. Warranties and Representations: Warranties regarding services/goods and general business representations
10. Liability and Indemnification: Allocation of risks, limitation of liability, and indemnification obligations
11. Termination: Grounds for termination, termination process, and consequences
12. Confidentiality: Protection of confidential information and trade secrets
13. Governing Law and Dispute Resolution: Choice of Indonesian law and dispute resolution mechanisms
14. General Provisions: Standard boilerplate clauses including notices, amendments, and assignment
1. Intellectual Property Rights: Required when vendor agreement involves creation, licensing, or use of intellectual property
2. Insurance Requirements: Include when vendor's activities require specific insurance coverage
3. Compliance with Anti-Corruption Laws: Additional detail needed for high-value contracts or government-related work
4. Force Majeure: Detailed force majeure provisions for critical supply relationships
5. Security Requirements: Include for vendors handling sensitive data or requiring facility access
6. Environmental Compliance: Required for vendors whose activities have environmental impact
7. Service Level Agreement: Include for ongoing service provisions with specific performance metrics
8. Change Control Process: Needed for long-term or complex service arrangements
1. Schedule 1 - Scope of Work: Detailed specifications of goods/services to be provided
2. Schedule 2 - Pricing Schedule: Detailed pricing structure, rates, and payment terms
3. Schedule 3 - Service Levels: Performance metrics and service level requirements
4. Schedule 4 - Key Personnel: List of key vendor personnel assigned to the contract
5. Schedule 5 - Technical Specifications: Detailed technical requirements and standards
6. Schedule 6 - Compliance Requirements: Specific regulatory or compliance obligations
7. Appendix A - Form of Purchase Order: Standard format for issuing purchase orders under the agreement
8. Appendix B - Security Protocols: Security procedures and requirements if applicable
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