Effortless Company Registration in Indonesia with CPT Corporate Business Consulting

We ensure your company remains legally compliant, so you can focus on growing your business in Indonesia. We provide comprehensive services, from business setup to ongoing compliance support.

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FORMS OF LEGAL ENTITIES TO CONSIDER IF YOU’RE A FOREIGN INVESTOR

Our corporate specialist with 10+ years of experience can help you navigate the complex process of acquiring legal permit to do business in Indonesa.

Foreign Liability Company
Representative Office

It is called a foreign-owned companyin Indonesia if any foreign individual or foreign entity holds share(s) in an Indonesian company. A foreign-owned company is often called PT PMA which stands for Perseroan Terbatas Penanaman Modal Asing or the limited liability of company (LLC) of foreign investment.

Most of the business open for foreign investor, but for some sectors it may have a maximum ownership and/or close for foreign business.

Under PT PMA, the company is allowed to fully operate in Indonesia, such as generating revenue, hiring staff, buying property in Indonesia under the name of PT PMA, declaring dividends, and sponsoring foreign workers to get visas and/or work permits.

Further, the company can operate its business and can do the activities as below:

  • To obtain a business license or import and export license
  • Buy property such as land and building in the name of the company
  • Hire staff Open a bank account
  • Doing the sales and marketing As a sponsor to obtain a work permit and stay permit for the foreign employee(s) To separate the liabilities of the business with the parent company
  • To register your products (cosmetics, food, medicine) so that you can sell your products within Indonesian jurisdiction
  • To submit a bidding proposal to your Indonesian customers or Indonesian government

REQUIREMENTS TO REGISTER FOREIGN OWNED COMPANY(PT PMA) IN INDONESIA

  1. Minimum Paid Up Capital is IDR10,000,000,000 (ten billion Rupiah) or approximately equal to USD750,000 (seven hundred and fifty US dollars). The shareholders must sign a statement letter that the shareholders will inject the capital in accordance with the shareholding composition in the new-established company
  2. The minimum capital for each foreign shareholder is IDR10,000,000 (ten million Rupiah).
  3. Minimum of two shareholders. The shareholders can be an individual and/or corporations. Most of business are open for foreign investors, but for some sectors it may have a maximum ownership and/or close for foreign business.
  4. The composition of Board of Directors and Board of Commissioners. Minimum of 1 (one) Director and 1 (one) Commissioner. The director and commissioner can also hold the
    shares in the company (acting as shareholders). Director and commissioner cannot be the same person.
    Should you hire a Local Director to register a company in Indonesia?
    You have to appoint a local director if the appointed foreign director does not obtain work permit & stay permit in Indonesia. The work permit and stay permit of foreign director are crucial as those are the requirements to open a corporate bank account and to file the tax reporting.
    If the foreign director does not have any plan to obtain a work permit, then you have to hire local director to be able open a corporate bank account and filing the tax reporting that the advantage of having the local director is that the local director can also take care your administration purpose during the absence of the foreign director, such as signing the relevant documents or invoice.
  5. Registered Office Address. The address must be in the commercial area.
  6. Name of the Company. The name shall consist of 3 words. The words cannot contain the words which have a meaning as Corporation, Company, Limited Liability, Incorporation, or any other name which has a similar meaning. Example of Indonesian company names: PT Tata Boga Indonesia, PT Jaya Success Indonesia. After you select the name, you must check whether the name is available to be used and not similar with other registered Indonesian company.

STEPS AND TIMEFRAME TO REGISTER COMPANY IN INDONESIA

No physical presence is required during the registration of company in Indonesia. The steps to register the company in Indonesia are below:

  1. Onboarding Process. Client to sign the service agreement and/or countersign our proposal. After that, we will issue invoice and send you the application form. Upon receipt the payment and application form, we will start the process.
  2. Requirements. Preparing the requirements as mentioned in the previous section i.e. name of the company, registered address, composition of the board of directors and commissioners and shareholders, etc.
  3. Signing the Statement Letter and Power of Attorney. We will provide a statement letter including the statement letter to inject the capital and power of attorney from the shareholders to us to taking care the registration process.
  4. Incorporation Process. (i) Articles of Association, (ii) Approval from Ministry of Law and
    Human Right, (iii) Tax ID Number/ (Nomor Pokok Wajib Pajak – NPWP), and (iv) Business Identification Number (NIB) (INCORPORATION DOCUMENTS).
  5. Apply for Work Permit and Stay Permit (KITAS). You can skip this step or do a parallel process with the step No. 6 below if you have local director to open the bank account.
  6. Open a Bank Account. Limited stay permit and/or work permit is required if the director is a foreigner.
  7. Further License

 

For your information, some of the business activities may require a further license. In Indonesia, the business activities are categorized based on the risk. The risk will determine what license that the company must obtain

NoRisk CategoryLicense Required
1Low RiskNIB
2Medium RiskNIB and Standard Certificate (no verification is required)
3Medium-High RiskNIB and Verified Standard Certificate
4HighNIB and Permit (izin)

Other than the standard certificate or permit as mentioned above, certain business classifications may also need additional for example if your business has a website that is used for e-commerce or marketplace transactions then, you will need Electronic System Certificate (PSE Certificate) issued by the Ministry of Telecommunication and Information, or if your business is selling productthat are consumed by human, you need to register your product to Food and Drug Agency (BPOM).

Representative Office does not require any minimum paid-up capital. If you do not want to invest so much and want to test the market first, a representative office may be an option. Although a representative office does not require any minimum paid-up capital nor established a legal entity in Indonesia, you still must comply with the tax reporting.

Type of Representative Office available for foreign investor in Indonesia is as follows:

  1. General Representative Office (KPPA)
  2. Trading Representative Office (KP3A)
  3. Construction Representative Office (BUJKA)
  4. Foreign Company Oil and Gas Representative Office

In this opportunity, we will be focus on KPPA and KP3A as the most inquired. To understand more on Construction Representative Office (BUJKA) and Foreign Company Oil and Gas Representative Office, please send your questions to our email inquiry@cptcorporate.com for more information.

The activities of KPPA and KP3A are limited to:

  1. As supervisor, liaison, coordinator, and manage the interest of the parent company or its companies’ affiliation;
  2. To prepare the establishment or the business development of a foreign investment company in Indonesia or in another country;
  3. Located in an office building in the provincial capital;
  4. Not looking for revenue in Indonesia, and it is not allowed in carrying out activities or doing something related to the commercial transaction of sales and purchasing goods or services with companies or individuals in Indonesia; and
  5. Not participating in any form in the management of a company, subsidiary, or branch company in Indonesia.

From the Parent Company:

  1. Article of Association of parent company in (Written in English or Indonesian);
  2. Board of Directors list of the Parent Company
  3. Passport of the Director of the Parent Company

From the Chief Representative Office (“CRO”)

  1. Passport (for foreign CRO) or KTP and NPWP (for Indonesian CRO);
  2. Pass photo in color;

No physical presence is required during the registration of company in Indonesia. The steps to register the company in Indonesia are below:

  1. Onboarding Process
    Client to sign the service agreement and/or countersign our proposal. After that, we will issue invoice and send you the application form. Upon receipt the payment and application form, we will start the process.
  2. Signing the letters prepared by CPT Corporate.
    We will provide a Statement Letter to be signed and legalized by the Parent Company.
  3. Incorporation Process.
    • Business Identification Number (NIB)
    • Trading BusinessLicense (for KP3A),
    • Tax ID Number (Nomor Pokok Wajib Pajak – NPWP) (INCORPORATION DOCUMENTS)
  4. Apply for Work Permit and Stay Permit(KITAS).
    You can skip this step if you appoint Indonesian CRO to open the bank account.
  5. Opening a Bank Account.
    Limited stay permit and/or work permit is required if the CRO is a foreigner.
  6. Start Operating
    In this step, you may start operating your business.

OTHER OPTIONS TO CONSIDER

Here are the entity options for you to consider other than company and representative office

OTHER OPTIONS TO CONSIDER

The minimum paid-up capital to establish a PT PMA is quite high. But this requirement does not apply to Indonesian companies whose shares are held 100% by Indonesian. Therefore, if you still need a legal entity and do not want to inject the minimum paid-up capital of PT PMA, you can consider using local company service. Annual charge is applied.

The employer of the Record

The employer of the record is a service where we, CPT Corporate, hire your talent or staff under our company but they will work on behalf of you. The employer of the record is one of the options for you if you do not want to open an entity in Indonesia, but you need someone to take care of the business. We will provide you the services with the payroll, transfer the employee salary, sign an employment contract, and advise you on the Indonesian employment law.

POST-SETUP COMPLIANCES

After the company is registered, you must comply with the following obligation:

Filing Investment Activity Report (LKPM) quarterly.

Annual General Meeting of Shareholders (AGMS)

Maintaining Company’s Register Book

Maintaining Share Certificates

Monthly and Annual Tax Reporting

Updating the Beneficial Ownership(BO) of the company

Manpower report

Registering Company’s Rule/Book (only applicable if the employees are >10)

Registering to Social Security Program (“BPJS”) Social and Employment

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Credibility and Expertise in CPT Corporate

You will be assisted by our in-house-lawyer and accountant who has credibility and experiences in setting up the business. We can adviseyou on the best type of company for your business and help you register it quickly and efficiently. We also provide guidance on the company structures and compliance requirements in Indonesia.

Credibility and Expertise in CPT Corporate

We have 10+ years of experience assisting clients in various business sector.

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