The MoU for Purchase of Goods is commonly used in Indonesian business practice as a preliminary step before entering into a definitive purchase agreement. It is particularly relevant when parties need to document their initial understanding while conducting due diligence, obtaining corporate or regulatory approvals, or negotiating detailed terms. The document typically includes proposed commercial terms, timeline for definitive agreement, confidentiality obligations, and other key preliminary arrangements. Under Indonesian law, while most provisions are non-binding, certain clauses like confidentiality can be made explicitly binding. This document type is especially useful in complex transactions involving foreign parties, significant purchase values, or when regulatory compliance needs to be assessed before final commitment.
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1. Parties: Identification of all parties to the MoU, including full legal names, registration numbers, and addresses
2. Background: Context of the proposed transaction, relationship between parties, and purpose of the MoU
3. Definitions: Key terms used throughout the document defined for clarity and consistency
4. Scope of Understanding: General outline of the proposed goods purchase arrangement, including types of goods and basic commercial relationship
5. Commercial Terms: Preliminary agreement on key commercial aspects including estimated quantities, pricing mechanisms, and delivery terms
6. Duration and Timeline: Proposed period for negotiating definitive agreement and intended duration of the business relationship
7. Non-Binding Nature: Clear statement that the MoU is non-binding except for specifically identified clauses
8. Confidentiality: Binding obligations regarding confidential information exchanged during negotiations
9. Exclusivity: Any exclusive dealing arrangements during the negotiation period
10. Costs and Expenses: Each party's responsibility for costs incurred in negotiations and due diligence
11. Governing Law: Specification of Indonesian law as governing law and relevant jurisdiction
12. Execution: Signature blocks and execution formalities compliant with Indonesian law
1. Due Diligence: Include when significant due diligence is required, outlining the process and cooperation requirements
2. Regulatory Approvals: Include when the definitive agreement will require specific regulatory approvals or licenses
3. Intellectual Property: Include when the goods involve IP rights or when branding/trademark issues need to be addressed
4. Force Majeure: Include when parties want to address potential disruptions to negotiations due to unforeseen circumstances
5. Language Requirements: Include when document needs to be bilingual (Indonesian/English) per regulatory requirements
6. Corporate Approvals: Include when either party requires specific board or shareholder approvals
7. Environmental Compliance: Include when goods or manufacturing processes have environmental implications
8. Local Content Requirements: Include when goods must comply with Indonesian local content regulations
1. Schedule 1 - Proposed Goods Specification: Preliminary specifications of goods to be purchased
2. Schedule 2 - Indicative Pricing Structure: Outline of proposed pricing mechanism and preliminary price ranges
3. Schedule 3 - Proposed Timeline: Key milestones for negotiation, due diligence, and definitive agreement execution
4. Schedule 4 - Required Approvals and Licenses: List of anticipated regulatory and corporate approvals needed
5. Appendix A - Draft Term Sheet: Key commercial terms for the definitive agreement in bullet point format
6. Appendix B - Confidentiality Terms: Detailed confidentiality obligations and procedures
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