A local company or a domestic investment company is a limited liability company whose shareholders are entirely Indonesian entities (Indonesian citizens or legal entities), whereas a foreign investment company is a limited liability company with shares owned by a foreign entity (foreign citizens or legal entities).
A local company must be established by at least 2 Shareholders that may also become the company’s Management (Director or Commissioner) having at least Rp. 51.000.000, - of paid up capital (Small Scale).
Local companies may operate in any—but not all—areas of business.
The documents that are needed to establish a local company are the founders’ identity card (KTP), certificate of family registration (KK), and taxpayer number (NPWP), as well as their phone number and email. We may have to request additional documents if required.
A foreign investment company must be established by at least 2 Shareholders that may also become the company’s Management (Director or Commissioner) having at least Rp.2.500.000.000,- of paid up capital.
Foreign investment companies must also determine the area of business they intend to operate in according to the Government’s Negative Investment List that regulate the maximum amount of Foreign Capital in a company operating in certain business areas.
The documents that are needed to establish a foreign investment company are the founders’ identity card (KTP), certificate of family registration (KK), and taxpayer number (NPWP) for Indonesian citizens (WNI) and Passport for Foreign citizens, as well as their phone number and email. We may have to request additional documents if required.
The number of shares issued is the amount of paid-up capital, and you also have to determine the nominal value of each share.
Paid-up capital : nominal value of shares = number of company’s shares
Number of company’s shares × percentage of shares owned = number of shares owned by shareholders
Number of shares owned x nominal value of shares = amount that must be paid-up in the company
If you wish to establish a limited liability company with:
paid-up capital of Rp. 51.000.000, -
then the authorized capital is 4 × Rp. 51.000.000, - = Rp. 204.000.000, -
To calculate the number of shares issued, consider the following example:
A & B establishes PT ALFA BRAVO CHARLIE (“PT ABC”)
Authorized capital = Rp. 204.000.000, -
Paid-up capital = Rp. 51.000.000, -
Nominal value of one share agreed by the founders = Rp. 10.000, -
The number of shares in the company is 5.100
Then A & B holds 50% of the shares in PT ABC, with each holding 2.550 based on the following calculation:
A = 51.000.000: 10.000 = 5.100 x 50% = 2.550 shares, then A must store Rp. 25.500.000, - to the company’s account
B = 51.000.000: 10.000 = 5.100 x 50% = 2.550 shares, then B must store Rp. 25.500.000, - to the company’s account
Yes. The money transferred to the company’s account is the paid-up capital in the company. This amount may be withdrew for the operations of the company, as long as such withdrawal is represented in the company’s books.
The ‘purpose and objectives’ in a company’s deed of establishment must be determined according to the Indonesian 2017 Standard Industrial Classification KBLI 2017 issued by the government. Identify the business activities that your company intends to do, then check the KBLI 2017 based on the code, name, or explanation of the business activities. If you find that there is no industrial classification that suits your company’s business activities, select one that is most closely related. It is not possible to establish a company for “general” commerce or services, and your company’s business activities must be specifically stated in the deed of establishment.
Your company’s taxpayer number (NPWP) is administered by the tax office (KPP) in your company’s registered domicile. After the Online Single Submission (OSS) system began in 2019, applications for NPWP can be made by our notaries through the integrated Ministry of Law and Human Rights’ Online General Legal Administration system (AHU Online). The results may either be “successful” or “unsuccessful”. If your application is successful, then the remaining procedure is done manually by filling the application form for a legal entity’s NPWP, and submitting the following required documents:
Photocopy of the identity details of the company’s Directors/President Director, including the identity card (KTP), NPWP, and certificate of family registration;
The company’s Deed of Establishment and Ministerial Certificate of Ratification;
Statement letters signed by the company’s Director/President Director, including:
Confirmation of the company’s domicile (Surat Pernyataan Kedudukan/Domisili);
Confirmation of the document’s authenticity (Surat Pernyataan Keabsahan Dokumen);
Confirmation of the company conducting business activities (Surat Pernyataan Melakukan Kegiatan Usaha); and
Power of Attorney + Photocopy of attorney’s KTP
and Titles, Lease Agreements, confirmation of the company’s domicile from the office building management, and/or value of the latest land and building tax (PBB)
Your company will receive 2 (two) documents: your company’s NPWP and Certificate of Tax Registration (SKT Pajak).
The government intends to provide more ease of doing business by establishing the Online Single Submission (OSS) system, an integrated system that aims to accommodate applications for business license across different sectors and government authorities. As such, according to the Announcement of the Investment Coordination Board (BKPM) and provincial investment services offices (DPMPTSP Pemprov) concerning the Integration of Services for Trade Licenses (SIUP) and Company Registration Certificate (TDP), the government has adopted terms in which:
The TDP is replaced with the Company Identification Number (NIB)
The SIUP is replaced with the Business Permit (Izin Usaha)
SKDP digantikan dengan Izin Lokasi. (khusus untuk SKDP di luar Jakarta masih berlaku).
Commitments are a consequence of applying for licenses and permits through the OSS system. To fully obtain the license or permit required, businesses must fulfill requirements imposed by the relevant authorized ministry or government agency in a certain period of time, usually within a 1 (one) year term. Although businesses may still conduct its business activities in the pending time period.
You can register your company’s participation in the BPJS Kesehatan program by accessing https://new-edabu.bpjs-kesehatan.go.id/new Click the yellow “Register Badan Usaha Baru” button, and then you will be brought to the next page where additional instructions are given.
All notarial deeds and ministerial certificates of incorporation of the shareholding companies, as well as the identity card (KTP), certificate of family registration (KK), and taxpayer number (NPWP) of all of the company’s Director and Shareholders.
Determine first what you intend to change in your company’s Articles of Association, and ensure that you have collected all the required documents. We may also request additional documents or information if required.
Certain types of amendments to a company’s Articles of Association must be publicly announced in a newspaper, such as Capital Deductions, Acquisitions, Mergers, Debt to Equity Conversions, and others with varying periods of announcement.
It is possible for sole-proprietorships to obtain a business permit to do business in a residential area. Business entities such as limited liability companies (PT) and limited partnerships (CV) may perform their business activities according to the local zonings and urban planning.