The Manufacturing License Agreement is essential for businesses seeking to manufacture products in Indonesia using licensed technology or intellectual property. This document is particularly relevant in the context of Indonesia's growing manufacturing sector and its regulatory framework that encourages technology transfer and local production. It's commonly used when foreign companies want to license their manufacturing rights to Indonesian entities, or when domestic companies expand their manufacturing capabilities through licensed production. The agreement must comply with Indonesian regulations, particularly Law No. 3 of 2014 on Industry, investment laws, and intellectual property regulations. It typically includes detailed provisions for quality control, technical specifications, royalty payments, and regulatory compliance, making it crucial for both domestic and international manufacturing arrangements in Indonesia.
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1. Parties: Identification of the licensor and licensee, including their legal status and registered addresses
2. Background: Context of the agreement, including brief description of the licensed manufacturing rights and parties' authority to enter into the agreement
3. Definitions: Detailed definitions of technical terms, products, territory, and other key terms used in the agreement
4. Grant of License: Scope of the manufacturing license, including territory, exclusivity/non-exclusivity, and any restrictions
5. Term and Renewal: Duration of the agreement and conditions for renewal
6. License Fees and Royalties: Financial terms including upfront payments, ongoing royalties, and payment terms
7. Manufacturing Requirements: Production specifications, quality standards, and manufacturing facility requirements
8. Quality Control: Quality assurance procedures, testing requirements, and inspection rights
9. Intellectual Property Rights: Protection of IP rights, ownership of improvements, and licensing of related IP
10. Confidentiality: Protection of confidential information and trade secrets
11. Regulatory Compliance: Compliance with Indonesian laws, obtaining necessary permits and licenses
12. Representations and Warranties: Standard warranties regarding authority, IP ownership, and product quality
13. Indemnification: Mutual indemnification obligations for breaches and third-party claims
14. Termination: Grounds for termination, termination procedures, and post-termination obligations
15. Dispute Resolution: Process for resolving disputes, choice of law, and jurisdiction
1. Technology Transfer: Details of technical knowledge transfer, training, and support - include when the license involves complex manufacturing processes requiring technical assistance
2. Export Restrictions: Restrictions on export of manufactured products - include when territory restrictions apply or for compliance with international trade regulations
3. Environmental Compliance: Specific environmental protection requirements - include for manufacturing processes with environmental impact
4. Labor and Employment: Specific requirements regarding employment practices - include when licensor wants to ensure specific labor standards
5. Sub-licensing Rights: Terms for sub-licensing manufacturing rights - include when sub-licensing is permitted
6. Marketing and Distribution: Requirements for marketing and distributing manufactured products - include when license covers distribution rights
7. Insurance Requirements: Specific insurance coverage requirements - include for high-risk manufacturing processes
8. Force Majeure: Provisions for unforeseen circumstances - include when manufacturing is susceptible to external disruptions
1. Schedule 1 - Licensed Products: Detailed specifications of products covered by the manufacturing license
2. Schedule 2 - Technical Specifications: Manufacturing process specifications and technical requirements
3. Schedule 3 - Quality Standards: Detailed quality control standards and testing procedures
4. Schedule 4 - License Fees and Royalties: Detailed breakdown of all financial terms and calculation methods
5. Schedule 5 - Approved Manufacturing Facilities: List and specifications of approved manufacturing locations
6. Schedule 6 - Required Regulatory Approvals: List of required permits, licenses, and regulatory approvals
7. Appendix A - Technology Transfer Plan: Detailed plan for technical knowledge transfer and training
8. Appendix B - Quality Control Procedures: Step-by-step quality control and testing procedures
9. Appendix C - Reporting Ƶ: Standard forms for production reports and royalty calculations
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