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Establish company in Indonesia – The Company is the place for all production activities. Companies can be categorized as official listed companies in government, and companies that are not registered in the government. An officially registered company has a business entity for the company. Business entities are the status of companies officially registered in the government.

There are several types of companies, between Commanditaire Vennootschap- limited partnership, Firma, foreign joint venture company, Limited Liability Company and many more. How to establish company in Indonesia has a variety of procedures, depending on the type of company you want to establish.

Establishing Company Procedures

Here are some procedures on how to establish company in Indonesia based on some form of company:

1. Commanditaire Vennootschap / CV

Commanditaire Vennootschap / CV is a partnership established by a person or persons who entrusts money or goods to a person or persons who runs the company and acts as the leader of the partnership.

Terms for Establishing CV:

  • Minimum 2 (two) persons as Founder of the Company which also acts as the owner of the company consisting of Active and Passive Pesero.
  • Notary deed in Indonesian language
  • The founders of CV must be Indonesian Citizens
  • Ownership of 100% owned by local business owners means no participation of foreign nationals is permitted.

2. Firma

Firma (Fa) is a business entity established by two or more persons whose members are solely responsible for the company. The firm’s capital comes from the founding member as well as the profit / profits distributed to the members by comparison according to the deed of establishment.

Terms and Conditions of Firm Establishment include:

  • The number of company founders at least 2 (two) persons or more
  • Have the name that the firm will use
  • Has a board appointed and appointed by the founders. Who will act as an active founder, and who will act as silence founder.
  • Having specific aims and objectives (although of course it may include the widest possible intent and purpose) and business activities that are not contradictory to the Laws and Regulations applicable in Indonesia
  • Has a place of business as corporate headquarters located in commercial environments such as Office Buildings, Shops, shop houses or other business places designated as a place of business.
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3. Cooperation

Cooperatives are business organizations owned and operated for the common good. The cooperative is based on the principle of the people’s economic movement based on the principle of kinship.

General requirements for establishing cooperatives:

  1. Two copies of Deed of Establishment of a cooperative from a notary.
  2. Minutes of Cooperative Establishment Meeting.
  3. List of attendance meeting of establishment of cooperative
  4. Copy of the identity of the Founder (the order is adjusted to the attendance list to make it easier at the time of verification).
  5. The power of the founder (Selected committee) to take care of the legalization of the formation of the cooperative.
  6. Proof of availability of capital amounting to at least as much as the principal savings and compulsory savings that must be paid by the founders.
  7. Plan of cooperative business activities at least three years ahead and Cooperative Budget Plan and Cooperative Income.
  8. List of board members and supervisors.
  9. List of Working Facilities of Cooperatives
  10. The declaration has no family relationship between the management.
  11. Cooperative Organizational Structure.
  12. Statement Letter of status of cooperative office and supporting evidence
  13. Other documents required in accordance with the laws and regulations

Additional requirements for establishment of Cooperatives if owning a Savings and Loans business;

  1. Proof of payment of capital at the beginning of establishment, in the form of Deposit at a Government Bank on behalf of the State Minister of Cooperatives and Small and Medium Enterprises;
  2. Work Plan for at least 3 (three) years;
  3. The administrative and organizational facilities of the Savings and Loans Unit shall be managed in a special and separate manner from the account of its cooperative;
  4. Name and Curriculum of the Board and Supervisor
  5. Letter of Work Agreement between Cooperative Management and cooperative unit of cooperative unit
  6. Name and curriculum of the prospective manager who is equipped with:
  • Evidence has been attended training / apprenticeship of cooperative savings and loan business.
  • Certificate of good character
  • Statements have no family relationship between blood and mortal with the board and supervisor
  • A statement of the manager regarding his / her willingness to work full time.
  • Application for permits to hold a savings and loan business
  • Statement of Letter is willing to be examined and assessed the health of the Unit Savings and Lending cooperatives by authorized officers
  • Business Organization Structure Unit Savings and Loans.
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4. Foundation

Foundation is a legal entity having a social, religious and humanitarian purpose and purpose, established by taking into account the formal requirements specified in the law.

In Indonesia, the foundation is regulated in Law Number 28 Year 2004 regarding Amendment to Law Number 16 Year 2001 regarding Foundation. The plenary session of the House of Representatives on September 7, 2004 approved this law, and Indonesian President Megawati Soekarnoputri authorized it on October 6, 2004.

The application for approval of a foundation legal entity is filed by a notary to the Minister of Justice and Human Rights of the Republic of Indonesia by enclosing:

  • Copy of deed of incorporation of stamp duty foundation,
  • Photocopy of Taxpayer Identification Number on behalf of the foundation that has been legalized notary,
  • Photocopy of certificate of domicile foundation issued by the headman or head of the village and legalized notary,
  • Proof of payment of Non-Tax State Revenues

5. Limited Liability Company

Limited Liability Company is a legal entity to run a business that has capital consisting of shares, where the owner has a share as much as his shares. Because the capital consists of tradable shares, changes in company ownership can be made without the need to dissolve the company.

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The mechanisms of how to establish company in Indonesia with limited liability companies include:

  1. The founders came to request a certificate of incorporation of a Limited Liability Company to a notary public.
  2. Notary sends the deed to the Head of the Civil Directorate, Department of Justice.
  3. The founders or any of its persons or proxies shall carry a deed of incorporation approved by the Department of Justice together with a letter of approval from the Department of Justice to the office of the Registrar of the District Court which shall be subjected to the domicile of the Limited Liability Company to be registered
  4. The founders carry a deed of incorporation of a Limited Liability Company together with a letter of approval from the Department of Justice, as well as a letter from the Registrar of the State Court on the registration of the incorporation of the Limited Liability Company to the State Printing Office, which publishes the Supplemental State Gazette of the Republic of Indonesia. After the deed of incorporation of the limited liability company is announced in the Supplement to the State Gazette of the Republic of Indonesia, the relevant Limited Liability Company has become legal entity.

How to establish company in Indonesia may seem complicated. But if we know the procedure, everything will be easier.

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