Human resources outsourcing or commonly known as HR Outsourcing in Indonesia is a term used for a practice when an organization/company hires a third-party institution to manage its human resources activity and administrative matters. Generally in every company, human resources are among the most crucial aspects within the overall operations. In the simplest of terms, HR manages the humane aspects in your company: how your employees perform at work, and also how they get paid. Most companies have their own HR department, which consists of their internal HR employees. However, there are several instances where companies need more help.

Why Do Companies Use HR Outsourcing?

First, managing HR affairs internally could be difficult for companies with thousands of employees. For newly established foreign companies in Indonesia, managing HR affairs internally could be quite a hassle, especially when they’re often not yet familiar with the local laws and regulations. For these two scenarios, using HR outsourcing services is an excellent choice. Before making the choice to use HR outsourcing in Indonesia, it is important to know about the services usually provided.

Type of Services in HR Outsourcing in Indonesia

1. Payroll

In the world of HR, payroll might be the most outsourced service for companies. Calculating and paying salaries could become quite tricky if you conduct the process internally. Do not forget that paying salaries correctly and on time is a sign of the company’s commitment to the employees. In other words, there is no room for error on this front and the company’s reputation as a whole is at stake. This is precisely why using outsourced payroll services are popular.

2. Employee Benefits

Apart from the base salaries, most companies also provide additional benefits packaged to their employees. These benefits could come in the form of health insurance, post-retirement funds, and many more. Providing these additional services makes the company more competitive in terms of recruiting the best talents available. 

3. Employee Relations

Working with huge targets in mind, chased by deadlines could cause friction among employees or with the supervisors. HR outsourcing personnel in Indonesia are well-experienced to become mediators and manage internal conflicts when necessary. The external HR personnel can also be tasked to formulate company rules which will be adhered to by every single employee. Doing all these procedures could potentially improve employee relations within your company. 

4. Recruitment

Another service most commonly tasked to outsourced HR personnel is recruitment. The external HR personnel will be tasked to identify, approach, and present potential new recruits which can be suited to your specifications. You can then focus on the interview process and give the final approval before the appointment is finalized. 

5. Performance Review by HR Outsourcing in Indonesia

HR Outsourcing in Indonesia can also help you evaluate your employees’ performance. With the pre-existing benchmark and standards already set by the company, the appointed personnel would then measure and determine whether the employees have performed well. They are also able to give advice/suggestions on how the employees can improve.

Reasons to Use HR Outsourcing in Indonesia

After knowing the wide range of services that can be provided by outsourced HR personnel, here are more reasons that should convince you to use their services:

1. Using HR Outsourcing in Indonesia can Save Cost

Should you choose to use HR outsourcing services, you will obviously need to pay a certain amount of fee. However, it will be much cheaper than paying the salary of internal HR employees. Furthermore, you will need to organize training programs for the outsourced HR workers. Most HR outsourcing companies have personnel well equipped to manage your HR-related matters.

2. Minimize Risk

Payroll procedures, calculating benefits, managing employee data could be a long and time-consuming process. Processing these data for hundreds or even thousands of employees makes it highly possible for errors to occur. By using HR Outsourcing in Indonesia, you will have an experienced workforce with high attention to details.

3. Regulation Compliance

In Indonesia, matters regarding workforce and their rights are important. In a HR outsourcing institution, understanding and complying with the local laws and regulations are parts of their job specifications. By using their services, you will be absolutely sure of complying and implementing the rules correctly in your HR-related affairs. 

4. Data Security

Plenty of HR services involve the usage and processing of personal data. Generally, HR outsourcing organizations use highly-secured data storage with encryption features, meaning that your company and employees data will be safe and will not fall into the wrong hands.

5. Objectivity

Just like the name, human resources, the field of HR deals with the humane aspects of work life. Inevitably, this will involve sentiments and emotions. By hiring external, outsourced, HR personnel, you will be able to deploy people without prior ties or relations to the companies or its employees so in turn, they can become more objective. When you ask them to evaluate someone, they will focus solely on their performances and not something based on relation or familiarity. 

How can Double M help?

Using HR outsourcing in Indonesia can help you manage your HR affairs. Double M provide various HR services ready at your disposal.

Business in Indonesia presents a realm of exciting opportunities and unique challenges for entrepreneurs and investors alike. In recent years, Indonesia has emerged as a leading destination to do business. In order to do business in Indonesia, it is mandatory for you to obtain all the necessary licenses and permits. To make sure your business operations go smoothly, it would also be helpful to start and maintain a positive working relationship with the Indonesian business and governmental circle. Business in Indonesia has several important areas you have to consider.

Prominent Sector of Business in Indonesia

In its long history, Indonesia’s economy has leaned heavily towards the agriculture sector. Geographically, the country is blessed with plenty of fertile soil which are located evenly within the larger Indonesian territory. In the late 1960s, a significant process of industrialization and urbanization was kickstarted by the government. This expanded the country’s economic focus towards manufactured imports and new kinds of sectors. 

1. Automotive Industry

In Indonesia, the automotive industry is generally seen as the cornerstone of the country’s manufacturing sector. Many world class car manufacturers have started manufacturing factories or expanding distribution in the Indonesian territory. Indonesia is the second-largest car manufacturing nation in Southeast Asia. The robust growth is supported by the increasing amount of population, meaning that the target market is already available. 

With typically low labor costs and a continuously expanding middle class, international car manufacturers have been  investing heavily in order to expand production capacity in Indonesia. As for the designs, low-cost-green-car (LCGC) have been gaining popularity in recent years. However, it is quite widely known that most Indonesians still would rather buy multipurpose vehicles (MPV), considering the fact that they are able to carry many people. This is very useful because, by nature, Indonesians like to take their family members on a trip using their cars. 

Just like other parts of the world, the current buzz in the automotive industry is electronic vehicles (EV). Therefore, as we strive to reach a more sustainable future, the massive production and distribution of EVs are very common occurrences that you can see in Indonesia. As such, the EV sector seems like the specific niche that you can tap in to if you have ambitions on entering the automotive industry in Indonesia.

2. Property Industry

In recent years, the property industry has been one of the pillars of the economy. There are several reasons for this. First, property industries will grow once there’s macroeconomic growth in the country (represented by the increase of per capita GDP). This has occurred in Indonesia and as a result, purchasing power is increasing. In the past decade, the Indonesian GDP has increased exponentially. This puts them in the position to purchase houses, apartments, and condominiums. 

Furthermore, Indonesia currently has a beneficial demographic composition. With a population of over 270 million people, the country is already a promising market to begin with.

Indonesia is undergoing a rapid process of urbanization. More than half of the Indonesian population currently lives in urban areas. When this happens, the demands for new houses, apartments, etc. will continue to increase. For potential business investors, this serves as a hugely potential market to tap into. If you come to Indonesia to enter the property market. There will be a large market of potential buyers at your disposal.

3. Tourism Industry

Now that Indonesia is slowly recovering to normal conditions, the tourism sector is once again in a prime position to bounce back. The Indonesian government is making strategic plans to revive the industry, including offering foreign investors to take on projects worth up to USD 1 billion. 

One of the efforts to revive Indonesian tourism is the cooperation between the Ministry of Tourism and the Ministry of Investment. The two institutions agreed to work together intensively to build the creative economy and infrastructures, exchanging data and information, and upskilling the workers in the tourism industry.

Furthermore, the Ministry of Law and Human Rights through the Immigration Services are continuously formulating new regulations to ease foreign traveler’s way to Indonesia such as creating new policies like Second Home Visa and Visa on Arrival. The results are clear for all to see. The tourism industry in Indonesia has come back to life. As business practitioners, it becomes such an interesting opportunity for you to invest in Indonesian tourism, either in the hospitality side or even invest in the tourism objects. 

Business Permit Registration for Foreign Companies in Indonesia

After securing the certificate and being officially established as a Perseroan Terbatas (PT), a company still needs to obtain and register their tax identity then process a business permit (Perizinan Berusaha) before starting their operations, which consists of Basic Requirements (Persyaratan Dasar) and Risk-Based Business Permit (Perizinan Berusaha Berbasis Risiko).

 The Basic Requirements consist of:

1. Kesesuaian Kegiatan Pemanfaatan Ruang (KKPR), a document that verifies the planned usage of the location being used.
2. Persetujuan Lingkungan/Environmental Permit, a document that verifies that the operations of the will not endanger the environment, issued by the Ministry of Environment and Forestry.

Persetujuan Bangunan Gedung dan Sertifikat Layak Fungsi, documents that verifies that the building used follows a certain quality and safety standard.

Risk-Based Business Permit in Indonesia

The Risk-Based Business Permit consist of:

1. Low-Risk Business owners must have a Nomor Induk Berusaha (NIB)/Business ID Number.
2. Medium-Risk Business owners must have NIB and standard certificates.
3. High-Risk Business owners must have NIB and a business license.

After submitting all documents, the Online Single Submission (OSS) system under the jurisdiction of the Ministry of Investment will review the documents. Should the application be approved, the business permit will be issued by the aforementioned ministry on behalf of the government

How can Double M help?

Before starting your business in Indonesia, it is important to decide whether you want to establish your own company or join forces with others. Double M can help you either way. We can help you establish your company in Indonesia or help you find local partners which suits you. 

Virtual office in Indonesia is defined as a service that enables you to register pre-existing office buildings as your designated business address while you operate your business from another location. In Indonesia, this type of office is commonly found especially for emerging companies.

How to Establish Virtual Office in Indonesia?

For company establishment in Indonesia, you are obliged to set it up formally as a legal entity. One of the key requirements to be one is that your company must have an office location. When you don’t have funds to build an actual office for your own, using a virtual office could be a superb alternative. The emergence of video conferencing softwares positively helps the usage of virtual offices. 

How Does a Virtual Office Work?

Virtual Offices are usually operated as one large unit to accommodate customers. This type of office is increasingly popular among emerging startups and new businesses.

Reasons to Rent Virtual Office in Indonesia

Here are several reasons why you should rent a virtual office in Indonesia:

1. Mobility

Traditional companies are usually known to operate in physical offices. Meaning that they either rent an actual building or build it from scratch. Ever since the Covid-19 pandemic, business practitioners have come to realize that it’s actually possible to maintain a business and keep it running with employees who work from home. With this newly changed status quo, the usage of physical office buildings no longer becomes a necessity, especially if you intend to start a business in Jakarta, which is known to have busy traffic. By using a virtual office, you won’t have to bother transporting from home to work and so do your employees. This will save everyone’s time. 

2. Flexibility

Without the existence of a physical office building, there would be no one to come early and open the door and also to clean up everything. It also means that there won’t be a fixed operational hours for you to conduct your business. This could make the operations run smoothly. Having a virtual office also gives you the opportunity to pick literally any location of your choosing. If you plan to expand your coverage and exposure, using a virtual office is an excellent choice. 

3. Cost-Saving

One of the most popular reasons to use a virtual office is to save cost. It is the clear advantage of using a virtual office compared to a traditional one. By using a virtual office, you will have fewer bills to pay, no cleaning services fee, no maintenance fee and many more. As a result, you will be able to allocate your company funds to other pressing matters. 

How can Double M help?

If you plan to register company in Indonesia, using a virtual office in Indonesia is an excellent alternative you can choose. With Double M’s help, you will be able to set up a virtual office in Indonesia easily.  

Minimum salary is the lowest amount of remuneration that employers have to pay their employees. This system is introduced in order to protect the rights of the employees. With this regulation, companies are obliged to pay their employees above the established standard. Practically every country has its own amount of minimum salary that rises from time to time. The same thing also applies in Indonesia. 

Several provinces in Indonesia have announced that their minimum salary is rising. On November 28th 2022, it was announced that the minimum salary in Jakarta will rise to IDR 4.901.798. This represents a 5,6% increase from 2021’s minimum salary which stood at IDR 4.641.854.  West Java’s increases by 7,88% to IDR 1.986.670, East Java’s increases by 7,86% to IDR 2.040.244, and Banten’s increases by 6,4% to IDR 2.661.280.

For the employees, this news would surely be a good news. As for the employers, there are several impacts that need to be considered due to the upsurge of minimum salary in Indonesia. 

1. Purchasing Power Increased

With the minimum salary in Jakarta increasing, it can be expected that the purchasing power will rise as well. According to the Indonesian Bureau of Statistics (BPS), household consumption accounts for 50,4% of Indonesia’s GDP. This proves that Indonesians love to spend their money to purchase goods. With the incoming salary increase, the increase of purchasing power becomes inevitable. If you own a company that produces goods. This could be an excellent momentum to attract more buyers. 

2. Product Prices Increased

When product manufacturers know that the people’s purchasing power is on the rise, they are also likely to increase their selling prices to maximize the momentum. This is another domino effect that could potentially happen after the minimum salary in Jakarta officially increases. However, you must be fully aware of the buying behavior of most Indonesian people. According to Rudianto (2014), 85% Indonesians prefer cheap products over expensive ones. You must take this into account when setting your prices. If you set it high, you could get high returns but if you set it under the average price, you could also have plenty of buyers for your product.

3. Employee Salary Appraisal

If your company is based in Jakarta, you must then comply with the upcoming increase of minimum salary. Specifically, you might have to make some adjustments on the salary of your employees. If some had lower salaries than the minimum amount, you shall increase it past the limit. This payroll adjustment is a decision that could potentially affect your company. When making the decision and conducting the technicalities, you should have an excellent HR team at your disposal. They will be the ones in charge of the new salary appraisal process and you could also get the finance team to re-check the numbers. 

NOTE:

• For general information about the provinces minimum salary (UMP) in Indonesia, you can access the Ministry of Labor Regulation Number 18 of 2022 here.
• For specific information about the minimum salary in Jakarta, you can access  the Governor’s Decree Number 1153 of 2022 here.

How can Double M help?

With the upcoming minimum salary increase, you might have to adjust your employees’ salary. With Double M’s help, you will be able to calculate and pay employee salaries while complying with the regulations. 

Recruitment agency is a firm that acts as an intermediary between the employer and prospective new employees. In this day and age, the usage of external recruitment agencies has become a common norm. This is because recruitment agencies typically offer a large database filled with the best talent pool for all your recruitment needs. That being said, choosing the right recruitment agency is no easy feat by any means. To help you out, here are the tips for choosing a recruitment agency in Indonesia. Here are the tips for choosing a recruitment agency in Indonesia.

Recruitment Agency in Indonesia

1. Specify your type

First and foremost, it is imperative for you to decide what type of recruitment agency you prefer. If you’re looking for full-time employees, a traditional recruiting agency would be suitable. For a temporary or contract workers, staffing agency is the viable option. If you’re looking for high-level, high-positioned executives, you better go with headhunting agencies. And finally, if you’re looking to fill a specialized role, a niche recruitment agency is the place to go.

2. Explain your hiring needs in detail

The next thing you must do is be super specific about your hiring needs. What role are you trying to hire for, what are the job descriptions, what are the responsibilities, what is the salary. These are just a few standard pieces of information that you should tell the recruitment agency about. Furthermore, you should also explain the company’s aim, values, and culture. These are essential in order to get the right person.

3. Due Diligence on the agency

Just like the usual employee recruitment process, you should also perform due diligence on the recruitment agency you’re about to choose. Look for information on their website, assess and carefully examine the reviews, and seek track records with companies they used to work with. If everything is up to par, it’s time to continue to advance to the next phase.

4. Observe the Standard Operating Procedure

If possible, it would be very great if you can visit the recruitment agency’s office and observe their work in person. Doing this will give you clearer insight on how they operate. You can specifically observe how they manage time and how they solve problems.

5. Confirm budget

Recruitment is an intricate process which plays a big role in a company’s operations. Therefore, it is no wonder that recruitment agencies charge substantial fees for you to use their service. If you feel like they have ticked all the boxes in your criteria, you should make sure that the fee they demand is still within your budget.

How can Double M help?

With the services of a recruitment agency, your company will be able to recruit the best talents available. Double M provides a recruitment service that can solve your hiring needs. Should you need tips for choosing a recruitment agency in Indonesia, please contact us.

Naturalization in Indonesia is a process where foreign citizens can earn a new status as Indonesian citizens because they have lived in Indonesia for a certain amount of years or go through a series of specific procedures. 

In Indonesia, naturalization increased in popularity after famous footballer Cristian Gonzales was naturalized as an Indonesian citizen in 2010. Over the years, not only footballers have followed suit but regular citizens as well. Here are the advantages of naturalization in Indonesia.

1. Protection from Deportation

There have been many cases where tourists or temporary visitors are deported from Indonesia because they committed crime. By being an Indonesian citizen, Indonesia will automatically be your country of origin. As a result, there shall be no possibility of a deportation for you. This does not mean you can do everything as you please without obeying the law. Should you commit a violation, the existing legal regulations will apply on you and consequences will occur .

2. Government Job Eligibility

In every job in the Indonesian government, the main requirement for potential applicants is that they must be an Indonesian citizen. You will be eligible to apply for a job in the Indonesian government by getting naturalized as an Indonesian citizen. One of the most known advantages of getting a government job is that you will receive a monthly pension money after you retire for the rest of your days. 

3. Ease to Travel

Upon the successful completion of your naturalization process, you will be eligible to apply for an Indonesian passport. Having an Indonesian passport is so beneficial since it will allow you to travel overseas as an Indonesian citizen. 

4. Right to Vote

As an Indonesian citizen, you will obtain the political right to vote in elections, either for city officials, legislative members, and Presidents/Vice Presidents. Electoral voting right is one of the most profound rights for an Indonesian citizen, allowing you to take part in a huge democratic event and play a part in the country’s political process. 

How can Double M help?

Naturalization as an Indonesian citizen could potentially bring you many advantages. With Double M’s help, you will be able to complete the procedures with no hassle.

When you expand your business in Indonesia, it is very likely that you will produce waste that harm the environment. The Indonesian government formulated a series of laws and regulations regarding waste management in Indonesia. As a business owner, it is important for you to know the in order to comply with the regulations. Here are the waste regulations in Indonesia.

1. Government Regulation Number 81 of 2012 on Management of Household Waste

This rule stipulates that every Indonesian citizen must reduce, reduce, and recycle their own waste using sustainable materials. Furthermore, this rule also regulates that companies and factories recycle their waste and make sure that all the materials in the production of their goods are from recyclable materials in its entirety. 

2.  Regulation of the Minister of Public Works of the Republic of Indonesia Number 3 of 2013 on Implementation of Waste Infrastructure and Facilities

As mentioned in its name, this rule specifically regulates the infrastructures and facilities of waste management in Indonesia, which consists of TPS, TPA, and TPS3R.

Tempat Penampungan Sementara (TPS), which is a temporary facility specifically designed to store waste before they are processed or recycled. TPS must have one important feature, which is a waste processing system that can classify and categorize the waste into at least 5 different types. This will help map out every kind of waste so that the process could be easier later on. Ideally, it would be much better if people already categorized their waste beforehand in order to help the TPS workers work more efficiently.

Tempat Pembuangan Akhir (TPA), which is a final facility to process waste into its final form and return it back to the environment in its new state. The types of waste that could enter this facility include household waste, household-like waste, and residue. 

Tempat Pengelolaan Sampah 3R (TPS3R), which is a waste processing facility with the concept of reduce, reuse, and recycle. In this facility, all the waste is collected, organized, reused, and recycled. Furthermore, the waste management processes on this facility include organic waste processing, non-organic waste processing, household and toxic hazardous waste processing, and residue waste processing. All the processed waste will then be transferred to TPA.

3. Presidential Regulation Number 97 of 2017 concerning National Policy and Strategy for the Management of Household Waste and Household-Like Waste

This regulation focuses on establishing a roadmap to Indonesia’s Waste-Free goal in 2025. The series of plans and programs intended to achieve this is named Jakstranas. It involves reducing a substantial number of household and household-like waste.  Furthermore, another key target of Jakstranas is to reduce 30% of waste from its original source and process 70% waste by 2025. Jakstranas is integrated and embedded into every long term development of the country and city governments, acting as a benchmark and point of reference in policymaking.

4. Government Regulation Number 101 of 2014 concerning Management of Hazardous and Toxic Waste

This rule specifically talks about Bahan Berbahaya dan Beracun (B3) or toxic and hazardous waste. Toxic waste is the type that is potentially harmful or fatal to living organisms who are exposed to them. Meanwhile, hazardous levels are also harmful albeit on a lower level than toxic waste. This rule explains the definition of each type and also emphasizes the fact that everyone who produces toxic and hazardous waste in their business operations has to manage, reduce, store, collect, and bury them. Those whose operations produce toxic and hazardous waste must first obtain an environmental permit.

5. Law of the Republic of Indonesia Number 8 of 2008 concerning Waste Management

This is one of the earliest iterations of a rule regulating waste management in Indonesia. This rule strongly reaffirms the Indonesian government’s commitment to the 3R policy (reduce, reuse, recycle).

Reduce is the act of decreasing the usage of materials that could potentially end up as a waste. Reuse is the act of continuously using the same objects for a long amount of time in order to stop purchasing new ones and creating waste. Recycle is the act of reprocessing waste and transforming them into something completely new and useful.

The goal of this rule is to improve the general health of Indonesian citizens, increase the quality of the environment, and turn waste into a beneficial resource. This rule also states that waste management is the responsibility of every Indonesian with no exception. 

How can Double M help?

Waste Management in Indonesia has a strict regulation. Double M strives to help our clients comply with all the key regulations in Indonesia. Should you have any inquiries, please contact us.

Visa Emergency Notice Indonesia – According to the Press Release number SPIMI/012/2022/03 issued by the Directorate General of Immigration, it was reported that their primary office was caught on fire at 10.49 a.m. on Thursday (8/12/12). As a result, there will be a delay in immigration services such as visa approval, living permit approval, and M-Passport. 

Due to this unforeseen circumstance, the entire building has now been evacuated. Immigration employees were permitted to go home and finish their work remotely. This may cause the delay in the services as most of the documents and resources are located in the office. 

For applicants currently using one of the Immigration services, you are advised to visit the www.imigrasi.go.id and @ditjen_imigrasi Instagram account in order to keep up with the latest information. For further information, you may contact the Public Relations Subcoordinator of the Indonesian Immigration Service, Mr. Achmad Nur Saleh at 0812-9126-2833 regarding the Visa Emergency Notice Indonesia.

How can Double M help?

In order to obtain a visa, you must go through the procedures at the Indonesian Immigration Service. With Double M’s help, you will be able to complete these procedures with no hassle.

Multiple Entry Visa in Indonesia – Acting Director General of Immigration Widodo Ekatjahjana officially conducted a trial for the reopening of Multiple Entry Visa (VKBP). This policy was stopped during the Covid-19 pandemic and was reintroduced for trial on Tuesday, (22/11/2022). The policy is mostly aimed for high level business people and potential investors with large capital, which could potentially support the economic recovery in Indonesia. 

It is important to note that you cannot use VKBP to work in Indonesia. Holders are permitted to enter Indonesian territory within 1 year with a stay period of 60 days for each entry, and VKBP holders can only enter and exit Indonesia from the Immigration Checkpoints (TPI) in the Riau Archipelago, but can travel to other Indonesian territories. 

Multiple Entry Visa Requirements

• Passport valid for 18 months at the minimum
• Application letter from the Sponsor
• Proof of having living expenses in an amount of at least USD 2,000 in the form of a checking account, savings book, or time deposit for the last 3 months
• Proof of return ticket/onward ticket
• Coloured photo with size of 4 x 6 cm (white background)

Additional Covid-19 Requirements

• Evidence of having received the full dose of the COVID-19 vaccine and a booster
• Proof of ownership of health insurance/travel insurance which includes health financing, and a statement of willingness to pay independently if affected by COVID-19 while in Indonesian Territory.
• Statement letter willing to comply with all applicable health protocols in Indonesia.

Multiple Entry Visa application procedures

1. Submission

VKBP applicants must have a sponsor in the form of a corporation or company in Indonesia.

2. Issuance of Visas

Upon successful submission and payment processes, The Directorate General of Immigration will issue the VKBP within 8 working days.

How can Double M help?

Obtaining a Multiple Entry Visa in Indonesia will help you conduct business in the country with ease. With Double M’s help, you will be able to complete the procedures with no hassle.

Distributor Agreement in Indonesia – Distributor Agreement :  Contracts between a distributor and manufacturer. They allow the distributor to sell, market, and profit from the sales of a manufacturer’s or wholesaler’s product in bulk. A distribution agreement typically uses the terms and conditions that address territories, exclusivity rights, reporting requirements, and more.

Basic points of a sole Distributor Agreement in Indonesia :

– ARTICLE 1 : GENERAL

Company agrees to represent PRINCIPAL in the activities of selling trading goods provided by the PRINCIPAL, in which the product is one of the trading goods owned by the PRINCIPAL. COMPANY acts as the Sole Agent / Distributor in all types of transactions that occur in Indonesia in accordance with the agreement of the parties.

– ARTICLE 2 : TERM OF AGREEMENT

In this article, the period of this agreement between COMPANY and PRINCIPAL is determined and may or may not be automatically extended in the absence of notice, as well as the terms and conditions for terminating this agreement.

– ARTICLE 3 : PRODUCT AND SALES AGENT / DISTRIBUTOR FEE

COMPANY is entitled to obtain a special price for sales performed in Territory and in accordance to values invoiced by PRINCIPAL to COMPANY as to determine the variable of commission for COMPANY and the detailing of the total price is determined from the effective amount received by the consumer.

– ARTICLE 4 : TERMS OF PAYMENT

Payment is performed by COMPANY in the term according to the issued payment invoice by PRINCIPAL, that is specified, payment is performed within 60 (sixty) days after the bill lading date.

– ARTICLE 5 : TRANSPARENCY

COMPANY will provide full transparency on all sales-related activities for the Products owned by PRINCIPAL in the Territory. The PRINCIPAL will perform full transparency upon the appointment of Distributor for COMPANY and shall not undermine the purposes and provisions of this Agreement.

– ARTICLE 6 : SOLE AGENT / DISTRIBUTOR ACTIVITIES

COMPANY will serve its role as Sole Agent / Distributor by performing promotional activities and sales to customers in Territory. All details of COMPANY as sole agent/distributor are also written in this agreement. 

– ARTICLE 7 : OBLIGATION OF THE PRINCIPAL

PRINCIPAL guarantees its obligation to provide knowledge and training as required for COMPANY as Sole Agent / Distributor.

– ARTICLE 8 : TAXATION

Both Parties are responsible for their own taxation obligations arising from this Agreement.

– ARTICLE 9 : MINIMUM SALES TARGET

In this article, the minimum sales target that must be met in accordance with what has been agreed by both parties is listed, it is also stated in this article the bonus that will be obtained by COMPANY if it reaches the minimum sales target and also listed the consequences if COMPANY does not meet the minimum sales target.

– ARTICLE 10 : ASSIGNMENT AND SUB AGREEMENTS

To ensure that neither Party may surrender, assign or transfer part or all of this Agreement, without the prior written express consent of the counterparty.

– ARTICLE 11 : GUARANTEE

Both Parties guarantee that each Party able to act based on Indonesia and its country’s governed law to conduct its line of business which is in accordance with the fulfillment of this Agreement, therefore Both Parties shall not be troubled by any party claiming to have prior rights there to, and therefore Both Parties are herewith relieved of all claims by other parties regarding such matters.

– ARTICLE 12 : CONFIDENTIALITY

Recipient of Confidential Information agrees to keep confidential all Confidential Information and not disclose or cause or permit the disclosure of the Confidential Information unless written acknowledgement is obtained  by the Disclosure.

– ARTICLE 13 : INTELLECTUAL PROPERTY RIGHTS

The Parties hereby acknowledge that all actions performed based on this Agreement do not imply any transfer of the Intellectual Property Rights between the Parties. Intellectual Property Rights owned by the Parties are, but not limited to, logo, naming, idea, strategy or any other forms with its relation in accordance with this Agreement. With no written consent by the Party owning Intellectual Property Rights, the other Party has no right to use, change or acknowledge it as its own and use it for its own account. 

– ARTICLE 14 : FORCE MAJEURE

In this article, it states a force majeure that can occur between the two parties, causing one party to be unable to carry out its obligations, then the suffering Party is obliged to notify the counterparty within 7 (seven) business days of said force majeure incident.

– ARTICLE 15 : INDEMNITY

COMPANY will not be liable for any damages suffered by PRINCIPAL (including but not limited to, profit loss, third party claims, damages) arising from this Agreement from breach of contract, tort, disadvantage, negligence or other form of actions performed by PRINCIPAL. Under no circumstances will COMPANY be deemed responsible for remedies amounting more than the Fee mutually agreed by the Parties of this Agreement. 

– ARTICLE 16 : SEVERABILITY

In case one or more provisions in this Agreement shall be declared null and void as required by the existing laws or by a decree of an authorized institution, thus such unenforceability or cancellation shall not prejudice or cancel other provisions in this Agreement, and therefore, the other provisions in this Agreement, shall remain valid and binding and enforceable as set forth herein.

– ARTICLE 17 : NOTICE

Any Agreement-related notice, deliveries, or written request and communication required, permitted or desired to be given, shall be deemed effectively given upon receipt and shall be personally delivered or delivered by express international courier.

– ARTICLE 18 : GOVERNED LAW AND DISPUTE RESOLUTION

Any unresolved issues or questions of interpretation arising in connection with this Agreement shall be settled by mutual agreement of the Parties hereto. If this is not possible, all dispute arising from this contract shall be binding and be finally settled under the administrative and procedural Rules of selected legal actions as determined by the parties.

How can Double M help?

Preparing and signing a Distributor Agreement in Indonesia is crucial before you begin your business operations. With Double M’s help,  will assist you through the entire process successfully.