Things You Should Know About Company Registration in Indonesia

Indonesia is a place to consider when you are thinking of expanding your business in Asia. In light of the great natural resources, youthful demographics, and the increase in the accessibility of all the places in the world, this will be another good environment that foreign investors will like.

Company Types In Indonesia

When starting a business in Indonesia, there are certain types of business that you need to know so that you will be able to select the best business entity for you. The types of companies that can be found in company registration Indonesia are as follows:

Local Company (PT)

A Local Company (PT) is the most popular form of business in Indonesia. Since this type of business transaction is designed for the locals only, however, if you are a foreigner who wants to establish PT in Indonesia, then you are required to have at least 2 local Indonesian shareholders, 1 director, and, at least 1 commissioner.

Representative Office

Representative Office (RO) can be defined as one of the types of branches that a foreign company opens in a foreign country. A representative office can only conduct market surveys, and raise brand recognition in the local market. A representative office cannot engage in activities that will generate profits.

If you want to start to build your company presence in Indonesia before you can make an  investment, it will be more preferable to make this choice.

The only difference with the other types is that a representative office only needs at least one Chief of Representative Office. The process of establishing a representative office or RO in Indonesia is as follows. The following are some of the requirements: 

• Letter of Appointment
• The article of association of the parent company 
• The official copy of a valid passport for foreigner or ID card number and tax number for the proposed Indonesian RO Head
• The registration at the Chamber of Commerce of the parent company copies.
• Power of Attorney to sign the application 
• Letter of Intent
• Letter of Statement issued by the RO Head assuring the compliance with the contract and that they are only in Indonesia to work as RO Head and run no other business.

Foreign Owned Company (PT PMA)

A foreign-owned company is a business entity that can be established by foreign investors either wholly or partially in Indonesia. This type of business entity could select up to 3 business categories without an investment plan as soon as receiving the required licenses. Some of the major requirements for the formation of this business entity include: 

• Minimum 2 local shareholders
• 1 Director
• 1 Commissioner

For the record, it approximately takes 2 to 6 months to establish a PT PMA. The minimum amount of capital that is needed in a PT PMA is IDR 110 billion and must pay a flat of at least IDR 10 billion upfront.

The following are the documents which must be submitted to establish a Foreign Investment Entity (PT PMA):

• Approval of the company’s name
• The incorporation deed
• Approval of legal entity
• Tax ID registration (NPWP)
• Letter of domicile
• Application for NIB
• Application for additional licenses

How FastLane Can Help?

Our professional business advisors at FastLane Group will be able to help you with all your business needs. As your local agent, we can assist you in the registration process of your business in a very efficient and without stress. Contact us now!