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The Toll Manufacturing Agreement is essential for businesses looking to outsource their manufacturing processes in Malaysia while maintaining control over their product specifications and intellectual property. This contract type is particularly relevant in Malaysia's robust manufacturing sector, where many international companies partner with local manufacturers to leverage cost efficiencies and established infrastructure. The agreement details the relationship between the principal company (who owns the product specifications and intellectual property) and the toll manufacturer (who provides the manufacturing services). It ensures compliance with Malaysian manufacturing regulations, customs requirements, and tax implications while protecting both parties' interests through clear specifications of responsibilities, quality standards, and risk allocation. This document is crucial for businesses expanding their manufacturing capabilities without significant capital investment in facilities.
