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Prime Contract for Indonesia

Prime Contract Template for Indonesia

A Prime Contract under Indonesian law serves as the primary agreement between a Principal and a Prime Contractor for the delivery of significant works, services, or projects. This document must comply with Indonesian Civil Code requirements and related regulations, including mandatory bilingual provisions under Law No. 24 of 2009. It establishes the complete commercial and legal framework for the project, including detailed scope, pricing, timeline, risk allocation, and compliance requirements specific to Indonesian jurisdiction. The contract incorporates necessary provisions for local content, regulatory compliance, and dispute resolution mechanisms in accordance with Indonesian law.

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What is a Prime Contract?

The Prime Contract serves as the foundational document for major commercial relationships in Indonesia, establishing direct contractual relationships between Principals and their primary contractors. This document type is essential for projects requiring comprehensive legal and commercial frameworks, particularly in sectors such as construction, infrastructure, and major services. It must comply with Indonesian legal requirements, including the Civil Code (KUHPerdata) and Law No. 24 of 2009 regarding language requirements. The Prime Contract typically includes detailed provisions for scope, pricing, timeline, risk allocation, local content requirements, and dispute resolution mechanisms. It's particularly relevant for projects involving significant capital investment, complex delivery requirements, or regulated industries where careful attention to Indonesian regulatory compliance is essential. The document structure accommodates both domestic and international parties while ensuring enforceability under Indonesian law.

What sections should be included in a Prime Contract?

1. Parties: Identification of the contracting parties with full legal names, addresses, and company registration details

2. Background: Context of the agreement, relationship between parties, and purpose of the contract

3. Definitions and Interpretation: Definitions of key terms and interpretation rules, including language interpretation provisions for bilingual contracts

4. Scope of Work: Detailed description of goods/services to be provided, including specifications and standards

5. Contract Price and Payment Terms: Pricing structure, payment schedule, invoicing requirements, and currency provisions

6. Timeline and Delivery: Project schedule, milestones, delivery terms, and completion criteria

7. Rights and Obligations: Detailed responsibilities and obligations of each party

8. Representations and Warranties: Statements of fact and assurances from both parties

9. Compliance with Laws: Obligations to comply with Indonesian laws and regulations

10. Indemnification: Protection and compensation obligations between parties

11. Term and Termination: Duration of contract and circumstances for termination

12. Dispute Resolution: Process for resolving disputes, including jurisdiction and governing law

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

14. Execution: Signature blocks and execution requirements

What sections are optional to include in a Prime Contract?

1. Insurance Requirements: Required when the contract involves significant operational risks or high-value deliverables

2. Intellectual Property Rights: Include when the contract involves creation, licensing, or transfer of IP

3. Confidentiality: Required when sensitive information will be shared between parties

4. Force Majeure: Important for long-term contracts or those with significant external risk factors

5. Bank Guarantees: Include when advance payments or performance security is required

6. Local Content Requirements: Necessary for contracts in sectors with mandatory local content rules

7. Anti-Corruption Provisions: Important for high-value contracts or those involving government entities

8. Change Management: Include for complex projects likely to require modifications

What schedules should be included in a Prime Contract?

1. Schedule 1 - Scope of Work: Detailed technical specifications and requirements

2. Schedule 2 - Pricing Schedule: Detailed breakdown of prices, rates, and payment milestones

3. Schedule 3 - Project Timeline: Detailed project schedule with milestones and deadlines

4. Schedule 4 - Key Personnel: List of key personnel from both parties with roles and responsibilities

5. Schedule 5 - Performance Standards: Specific KPIs and performance criteria

6. Schedule 6 - Forms and Ƶ: Standard forms for notices, change orders, and other communications

7. Schedule 7 - Insurance Requirements: Detailed insurance specifications and coverage requirements

8. Appendix A - Required Permits and Licenses: List of regulatory approvals needed for contract performance

Authors

Alex Denne

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

Jurisdiction

Indonesia

Publisher

Ƶ

Document Type

Service Contract

Cost

Free to use
Relevant legal definitions



















































Clauses















































Relevant Industries

Construction and Infrastructure

Oil and Gas

Mining

Manufacturing

Technology and Telecommunications

Energy and Utilities

Transportation and Logistics

Professional Services

Defense and Aerospace

Healthcare and Pharmaceuticals

Relevant Teams

Legal

Commercial

Procurement

Operations

Project Management

Risk and Compliance

Finance

Business Development

Technical

Relevant Roles

Chief Executive Officer

Chief Legal Officer

General Counsel

Contract Manager

Project Director

Commercial Director

Procurement Manager

Legal Counsel

Business Development Director

Risk Manager

Operations Director

Technical Director

Chief Financial Officer

Compliance Officer

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

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