The existing Indonesian company law as contained in the ICC is admittedly not sufficient in accommodating today’s business problems, issues and interest.
The activities of a business may take various legal forms such as foreign joint venture-companies, public companies and State-owned enterprises, in addition to common companies.
Although the ICC requires that a company has to be established by a minimum of 2 persons, after its reception as legal entity, the company belongs only to one shareholder. Different types and classes of investors also require different categories of shares.
In addition, a clear definition and description of the responsibilities and liabilities of the shareholders as well as those of the management are also required. Finally, just to mention a few other aspect of the business is the legal framework for a merger.
The Company Law of Indonesia also provides for other types of companies, such as the public and open ones. The Company Act covers the following aspects related to setting up a company in Indonesia:
- The company must have shareholders who will deposit a share capital which will allow them to conduct a commercial activity;
- The company must have a board of directors, a board of commissioners and a general meeting of the shareholders;
- The preparation and amendments brought to the company’s statutory documents;
- A company must commit to taking part in the development of a sustainable economy.
Indonesia’s Company Law (Law No. 40 of 2007 on Limited Liability Companies) is a regulation that determines and binds how all companies operate their businesses in the Republic of Indonesia. Ever since it was enacted in 2007, the Indonesia Company Law has yet to be amended and it is a law that all corporate structures abide to.
Therefore, to answer your questions, it depends on how an individual looks at it. The Indonesian law can be stringent to some, and lenient to some. As long as you abide by the law, there shouldn’t be any issue.