Through a joint venture with Indonesian nationals, foreigners can create limited liability corporations in Indonesia. An LLC may be formed under the Company Law with a minimum share capital of 50 million rupiahs, or about 3,700 dollars, and with the Ministry of Justice’s consent.
Indonesian limited liability company types
There are two different forms of limited liability companies in Indonesia, according to the Company Law. The first kind, known just as the PT, is intended for local investors. Its primary attributes are:
- It cannot have any foreign shareholders and can only have local stockholders
- Depending on the company’s size, the minimum share capital begins at 50 million RP
- Medium-sized PTs can apply for foreign worker visas
- A local limited liability company can be incorporated in around 8 weeks
The PT PMA, or foreign direct investment limited liability company, is another type of limited liability corporation that includes the following features:
- no limitations on the number of business and work visas released for this type of company
- the company registration process for such a company takes about 10 weeks to complete
- the PT PMA can be fully or partially owned by foreign investors
- at least 25% of the share capital must be deposited upon the registration of the PT PMA
- it requires an investment plan and a minimum share capital of USD 700,000
How to register a limited liability company in Indonesia
The process outlined below is used to establish a limited liability company for Indonesian company registration.
Reservation of name
The applicant for Indonesian company registration must first reserve the name of the company. The Ministry of Law and Human Rights (MOLHR) must hold the LLC’s name in reserve. Such a name must be in Indonesian to meet the name requirements. Government Regulation No. 43 of 2011, which is dated 4 October 2011, outlines the requirements for name registration.
Approving the association’s articles of incorporation
The MOLHR must receive the articles of association by electronic means. The appropriate notary can complete this. The document must be submitted within 60 days. This must occur 60 days after the deed of establishment’s execution, which contains the articles of organization.
LLC location
Following the completion of the procedure, the domicile of the company would be received from the relevant Sub-District Office.
Fiscal identification number
The relevant tax authority would obtain the taxpayer’s registration number, or Nomor Pokok Wajib Pajak (NPWP).
Getting the Ministry of Trade’s (MOT) approval
The business must register with the company’s registry after the MOLHR gives its approval. This can be done within three months after the business’ incorporation at the relevant MOT regional office. Following that, the application would be integrated via the OSS system for Online Single Submission. This would provide a business registration number for Indonesian firm registration. The Nomor Induk Berusaha, or NIB, which serves as the company registration number, would be issued by the OSS.
Publication
The Articles must be delivered to the State Printing Office after receiving permission for this registration to be published in the State Gazette. The notary public will handle this. This procedure would take place 14 days after approval.
Post compliance requirements for Indonesian company registration
Following a company’s registration in Indonesia, there are specific post-compliance obligations that it must adhere to:
Ownership meetings
Annual General Meetings must be convened no later than six months after the fiscal year’s end. LLC is required to accomplish this. The firm may, however, also call an EGM at its discretion.
Governing body meeting
LLC would not be required to hold board meetings until it was specified in the company’s articles of organization. Board meetings are required for public limited corporations.
Business tax
In Indonesia, a 25% business tax is imposed. The official tax authorities must receive the annual tax return. This can be done via the online tax system provided by MOLHR.
Business Registration Compliances LLCs must complete their initial registration with the ministry of trade within three months. The establishment would then need to undergo a renewal, which is done every five years.
