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Sales Agreement for Malaysia

Sales Agreement Template for Malaysia

A comprehensive legal document governed by Malaysian law that establishes the terms and conditions for the sale and purchase of goods between parties. The agreement complies with the Malaysian Sale of Goods Act 1957 and Contracts Act 1950, detailing essential elements such as product specifications, pricing, delivery terms, warranties, and risk transfer. This document serves as a legally binding contract that protects both parties' interests while ensuring clarity in commercial transactions within the Malaysian legal framework.

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What is a Sales Agreement?

The Sales Agreement is a fundamental commercial document used to formalize the sale and purchase of goods in Malaysia. This document is essential when parties wish to establish clear, legally binding terms for their transaction, whether for one-time sales or ongoing supply arrangements. The agreement must comply with Malaysian legislation, particularly the Sale of Goods Act 1957 and Contracts Act 1950, and typically includes detailed provisions on product specifications, pricing, delivery, warranties, and risk allocation. It's particularly important for business-to-business transactions where significant value is involved or where complex delivery or payment terms need to be documented. The Sales Agreement helps prevent disputes by clearly defining each party's rights and obligations while providing mechanisms for issue resolution.

What sections should be included in a Sales Agreement?

1. Parties: Identifies and provides full details of the seller and buyer, including registration numbers for companies

2. Background: Sets out the context of the agreement and basic premises of the transaction

3. Definitions and Interpretation: Defines key terms used throughout the agreement and establishes interpretation rules

4. Sale and Purchase: Core terms of the sale including description of goods and basic commercial terms

5. Price and Payment: Details of the purchase price, payment terms, method of payment, and payment schedule

6. Delivery: Terms regarding delivery of goods, including timing, location, and delivery method

7. Title and Risk: Specifies when title passes to the buyer and allocation of risk in the goods

8. Warranties and Representations: Warranties regarding the goods' quality, condition, and fitness for purpose

9. Inspection and Acceptance: Procedures for inspecting goods and accepting or rejecting delivery

10. Term and Termination: Duration of agreement and circumstances allowing termination

11. Confidentiality: Obligations regarding confidential information shared during the transaction

12. Governing Law and Jurisdiction: Specifies Malaysian law as governing law and jurisdiction for disputes

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

What sections are optional to include in a Sales Agreement?

1. Intellectual Property Rights: Required when the sale involves products with associated IP rights or licensed technology

2. Export/Import Compliance: Necessary for international sales requiring compliance with trade regulations

3. Insurance: Include when specific insurance requirements are needed for high-value or high-risk goods

4. Return Policy: Required for sales where return rights are granted beyond statutory requirements

5. Training and Support: Include when the sale includes technical products requiring user training

6. Security Interest: Necessary when seller retains security interest until full payment

7. Force Majeure: Optional but recommended for long-term or high-value sales agreements

What schedules should be included in a Sales Agreement?

1. Schedule 1 - Product Specifications: Detailed technical specifications of the goods being sold

2. Schedule 2 - Pricing Schedule: Detailed breakdown of prices, especially for multiple products or volume-based pricing

3. Schedule 3 - Delivery Schedule: Detailed delivery timelines and locations for multiple deliveries

4. Schedule 4 - Quality Standards: Specific quality requirements and testing procedures

5. Schedule 5 - Warranty Terms: Detailed warranty terms and claim procedures

6. Appendix A - Form of Purchase Order: Standard form for placing orders under the agreement

7. Appendix B - Acceptance Certificate: Form for documenting acceptance of delivered goods

Authors

Alex Denne

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

Jurisdiction

Malaysia

Publisher

Genie AI

Document Type

Purchase Agreement

Cost

Free to use

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