Are you considering registering a company in Indonesia? Then you have found the right place! Check out our guide about company registration in Indonesia to find out everything you need to know!
At LetsMoveIndonesia, we have successfully helped hundreds of individuals and international companies expand and grow across Indonesia by assisting them register their companies. With offices across Jakarta and Bali, paired with an expert team and cost-effective prices, it’s no wonder why our legal team assists dozens of people every single month!
In this article, Ricko Astono one of LetsMoveIndonesia’s Legal Associates and company incorporation experts answers your most common questions about company registration in Indonesia!
LMI: Firstly, could you explain the different options available for both locals and foreigners planning to register a company in Indonesia?
RA: There are multiple options available to register a business in Indonesia, Indonesian citizens could make a PT (Perseroan Terbatas/Limited Liability Company), while Foreigners have two options to make a company which is PMA (Penanam Modal Asing/Foreign Investor Company) and KPPA (Kantor Perwakilan Perusahaan Asing/Representative Office).
PT Registration
LMI: What are the requirements to register a PT Company?
RA:In general, you need at least two Indonesian (only) Entity Shareholders and at least two Indonesian hired as the President Director and President Commissioner of the company. In some cases, the Shareholders can also be registered as President Director and President Commissioner.
All of the candidates above should have a Valid KTP (ID Card) and Valid NPWP (Tax ID Number).
Lastly, you will need a company address which later will be used as a Registered Company Domicile. In some cases, depending on their business classification, it is possible to use a virtual office.
LMI: Is there any capital investment and how much is it?
RA: There are two classifications of PT Companies which are UMK (Small Medium Enterprises) and Non-UMK (Non – Small Medium Enterprises).For UMK, PT Company should have a capital of around IDR 50,000,000 – IDR 5,000,000,000
For Non-UMK, PT Company should have at least a capital above IDR 5,000,000,000
Even if PT Company is addressed to Indonesian citizens, a PT Company can hire a Foreigner to be their Director or Commissioner if the PT Company has a minimum Capital of IDR 1 Billion.
LMI: What are the advantages of registering a PT over a PMA?
RA:As a PT company, since you are listed as a National Company, it is more flexible to choose a business classification as some business classifications are restricted to a PMA Company in an agreement called the Negative Investment List.
PMA Registration
LMI: What is PMA
RA:A PMA Company is intended for Foreigners who want to open up a business in Indonesia.
In general, there are two types of PMA Company in Indonesia, which is Foreign Fully-Owned PMAs and Foreign Partially-Owned PMAs.
LMI: What are the requirements to register a PMA company?
RA:If it’s a Foreign Fully-Owned PMA you need at least two Foreign Entity (can be in form of a Person or Company) to be Shareholders.
If it’s a Foreign Partially-Owned PMA you need at least one Foreign Entity and One Indonesians Entity.
All of the candidates should have valid identification; valid passports/IDs for a person, and valid company registration documentation for a company.
Company address which later will be used as a Registered Company Domicile. In some cases, depending on their business classification, allows PMA Company to register their company domicile in a virtual office.
LMI: Is there any capital investment and how much is it?
RA:For a PMA Company, the minimum investment requires IDR 10 Billion.
LMI: How can the investment be made?
RA:The investment can be made in a form of a Money Deposit to a local bank under the PMA company’s name or in an assets such as, equipment or property.
LMI: If I do not have 10 billion Rupiah, can I still register a company?
RA: The amount is a legal requirement for foreigners; however, for advice on this and alternative options, then feel free to contact me.
LMI: Are there any businesses that cannot be registered by a foreigner?
RA: Yes, there are some business classifications that cannot be registered by a foreigner as stated in Presidential Decree No.49/2021.
LMI: If your business model isn’t applicable to be registered by foreign nationals, what can you do?
RA: You could still be hired as a Director from a PT Company in the same business model. For further information please contact me.
LMI: What are the advantages of registering a PMA over a PT?
RA: As an investor of a PMA, you are eligible to get an Investor KITAS, which is more convenient than a Working KITAS due to optional 2-year validity and its cost effectiveness. Additionally, if you are the owner of a PMA, you have more control over your business and less risk.
Representative Office Registration
LMI: What is Representative Office (KPPA)
RA: KPPA is intended for a Foreign Company or Foreign Government body. With a KPPA, you will be able to supervise and coordinate business or do market research without the risk of large investments.
LMI: What are the requirements to register a Representative office?
RA: You need a Foreign Entity to appoint you as their Representative Executive or as a Foreign entity you need to appoint a Person as your Representative Executive in Indonesia.
The Representative Executive need to have a Valid Identification (Passport for foreigner/KTP For Indonesian).
LMI: Is there any capital investment and how much is it?
RA: There is no requirement for capital investment because as a KPPA office you are not allowed to make a profit in Indonesia or even issue an invoice.
LMI: What are the advantages or disadvantages of registering a Representative Office over a PMA?
RA: If you already have a business outside Indonesia and you want to investigate the Indonesian Market or do some research for your business, a KPPA office might be the best solution for you because you don’t need a large investment.
But if you already made up your mind and settled to open up a business in Indonesia, I suggest that it would be better for you to open PMA over KPPA.
General Questions
LMI: Do I need a physical address to register a business in Indonesia? If so, what are the options?
RA: Yes, you need a physical address to register a business in Indonesia. You can choose between renting a place for your business or even rent a virtual office depending on your business classification or needs.
LMI: Are there any additional licenses I need to obtain for different industries?
RA: Yes, depending on your business classification, you may need additional licenses to obtain, I can help you through it by identifying your business class and industries.
LMI: After registering my company are there any additional things I need to do to maintain the business monthly or annually?
RA:Yes, after registering your company, you still need to maintain your company business taxes and report them to the Indonesian Tax Office on a monthly and yearly basis.
Additionally, you are required to make an investment report quarterly which is reported using the Indonesian OSS system. If you need assistance with this, we can provide.
LMI: How much does it cost to register a company in Indonesia?
RA: Prices for company registration vary depending on what type of legal entity you plan to register and also the industry, as some companies require different licenses. For full information, I am happy to advise.
LMI: What are the advantages of using LetsMoveIndonesia to assist with my company registration compared to other legal agencies?
RA: There are many benefits that make us the primary choice for many people when setting up a company in Indonesia, here are just a few examples:
- Our customers save. Compared to the other national agencies, we are often 50% cheaper.
- We are the only agency in the country that openly advertises our prices. We don’t believe in price hiking, which is why all our prices are fixed and on display.
- We have legal experts in every office available for both appointments and walk-in consultations.
- We offer a free 1-hour consultation on all services.
- We were awarded the title “Best Visa & Business Consultancy” by the National Award Foundation for our dedication and market leading approach within our industry.
LMI: If there are any unanswered questions or people need to know more, what can they do?
RA: You can contact me directly to ask using any of my contact details or you can pop by the Jakarta office in Bellagio Mall, Mega Kuningan Jakarta. You may also check out our Company Establishment page on our website which provides a list of services and prices!
About Ricko
Ricko Astono is a Legal Associate with over 7 years of working experience in legal services.
Over the past 7 years, he has worked within a variety of legal agencies providing services such as company registration, additional licenses for business, handling circulars and bilingual agreements, legalizing documents, maintaining compliance and licenses, and of course, maintaining a good relationship with his clients.
With a passion for assisting people and expanding his knowledge, Ricko is one of Indonesia’s most sought-after corporate legal experts.
To get your free consultation, contact Ricko at: E: [email protected] or T/WA: +62 811 8337 821. Additionally, you can email our team using: E: [email protected]
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