Singapore Company Setting up a Foreign Company in Indonesia – Cooperation in the field of digital economy will also be established between Indonesia and Singapore. The emergence of Singapore-based companies is also an impact to the Indonesian economy. In fact, there are currently 41 companies from Singapore who are in the process of investing in Indonesia. This is one form of economic development with the Singapore company setting up a foreign company in Indonesia. Many aspects that must be considered in establishing buildings in Indonesia.
Permit of principle is a mandatory permission to start in business activities either in the activities of Domestic Investment or Foreign Investment. Activities that include starting a business as follows:
- The establishment of new business, whether in the framework of PMDN or PMA.
- The change of status to PMA, as the effect of the entry of foreign capital in the ownership of all or part of the company’s capital in a legal entity.
- The change of status to PMDN, as a result of the change of capital ownership of the company which previously existed foreign capital, to be entirely domestic capital.
There are several types of principle permits, as described below:
- A new principle permit, the first permit before starting the business;
- License of expansion principle, i.e. Permit prior to expansion of the company;
- Permit the principle of amendment, that is, a permit before making changes to the investment plan or its realization;
- Permit principle of incorporation, i.e. permission before merging 2 or more companies.
- The licensing as described above is submitted to the Central One Stop Service Center “PTSP” at BKPM, the Provincial, Regency or City Investment Coordinating Board “PTSP”, PTSP Free Trade Area and Free Port “KPBPB”, and PTSP Special Economic Zone.
Provision of Investment Value and Capitalization
Forms of economic cooperation, Singapore company setting up a foreign company in Indonesia there are provisions that must be met. PMA in obtaining the principle permit must perform the terms of investment and capital requirements, as follows:
- Total investment value greater than ten billion Rupiah, outside land and building.
- For the expansion of one business line in one business group based on the Indonesian Business Classification “KBLI” in the same location, provided that the accumulated investment value of all projects in the location reaches more than ten billion Rupiah outside land and buildings, the value of the investment is allowed to be less than ten billion Rupiah.
- For the expansion of one or more business fields in sub-categories based on KBLI, which does not obtain facilities outside the industrial sector, in one location within a district or city, the investment value for all business fields is greater than ten billion Rupiah outside land and buildings.
- Investments in the capital of the company, for each shareholder at least ten million Rupiah and the percentage of ownership of shares is calculated based on the par value of the shares.
- The value of the issued capital equals to the minimum paid up capital of two billion five hundred million Rupiah.
PMA companies licensed in principle prior to this regulation apply with a paid up capital of less than two billion five hundred million Rupiah, which will apply for extension of the project completion period or the expansion principle permit, shall adjust the participation in the capital of the company at least two billion five hundred million Rupiah.
Investors are not allowed to enter into agreements or inclusions that affirm that the ownership of shares in a limited liability company is for and on behalf of others.
In this service, the procedure that will be passed by the Singapore company setting up a foreign company in Indonesia is almost the same as other countries, namely:
- Investors come to BKPM with the requirements document, and then take the queue number;
- Investor consults with the Director of Services of BKPM in relation to its investment plan while providing necessary data and documents;
- Investors are waiting while the investor companion undertakes the processing of investment licenses;
- Done, Investor will get result 8 + 1, that is:
- Investment Permit.
- Company Deed and Legalization.
- Tax ID Number “NPWP”.
- Company Registration Certificate “TDP”.
- Plan for the Use of Foreign Workers “RPTKA”.
- Permit to hire Foreign Workers “IMTA”.
- Producer Importer Identity Number “API-P”.
- Customs Parent Number.
- Certificate of Map of Land Availability Information.
To feel how much profit is gained by investing in Indonesia, there are several procedures that must be done by the parties who want to invest. Investment procedures will be more complete with investment forms, SOP of the Ministry, arbitral procedures, investment incentive taxation, and the flow of problem solving. These procedures are the first step that must be done by those who want to invest their capital in Indonesia.
The procedure of investing in Indonesia can be done by two types of companies, local companies and foreign companies. Both types of companies must perform several different procedures. Differences in how to invest between the two types of companies can be seen from how to prepare a company to invest. This is similar to Singapore company setting up a foreign company in Indonesia.