Indonesia is a rapidly developing market with several opportunities and significant investment potential from international companies. It had caught the attention of many international investors worldwide due to its infrastructure needs, the breadth of its domestic market, its large population, and, most importantly, its abundance of natural resources.
To set up a company in Indonesia, you must first obtain an Indonesian business registration number.
Why should I obtain a Business Registration Number?
A company’s registration number is a unique number that is assigned by the authorities to register for corporate tax, filing and submitting tax returns, and more.
Hence, there are a few reasons why obtaining a business registration number is crucial in setting up a company in Indonesia. The reasons are as follows:
- Any limited liability company, albeit a Local PT company or Foreign Owned Company (PT PMA), can be frozen and dissolved by the government if an inspection was to take place and the company do not possess a business registration number. The communities would be able to report to the government companies that do not have permits because those companies would be considered illegal and irresponsible.
- If the company obtained a business registration number, it simply meant that the company has been recognised by the government and the business will be protected by applicable law and regulations
- Companies that have a business registration number in Indonesia will be listed in the list of state-recognised companies in Indonesia. With this recognition, the public will believe in all the performance and activities claimed by the company.
Benefits of Obtaining a Business Registration Number in Indonesia
As a result, there are several benefits that companies with a business registration number will get. These benefits are:
- You will be able to apply for a visa for any foreign employees that you hire under your company’s name
- You will be able to obtain any business visa sponsors for your clients from your company
- You can also join and participate in all business tenders in Indonesia by entering your company’s name
Do note however that obtaining a registration number is just part of the company registration procedure in Indonesia.
Procedures to obtain a Business Registration Number in Indonesia
The business registration number in Indonesia is a certificate of authorisation that is used by entrepreneurs for licensing purposes to carry out their respective business activities.
Thus, an entrepreneur who wishes to acquire a business registration number in Indonesia, would be required to follow the procedures below:
- Acquire the approval on the name of your company from the Minister of Justice and Human Rights of the Republic of Indonesia. This would take 4 working days to receive an approval
- Obtain the approval from Indonesia Investment Coordinating Board (BPKM), this may take 12 working days or more to acquire.
- Provide the preparation of the Articles of Association (Akta) which was legalized by the notary. This preparation may take approximately 4 working days.
- You would need to have the certificate of domicile from the local government office. This certificate may take at least 3 working days.
- You also must acquire the tax identification number or NPWP for your company in Indonesia. To obtain this tax identification number, it may take approximately 3 working days.
- After that, you need to open an account in a bank on behalf of your company. This will normally take a day to open the bank account.
- You need to obtain the deed of establishment for your company from the Department of Law and Human Rights of the Republic of Indonesia for about 20 working days.
- You should obtain the company registration certificate from the local government. To get this certificate, it may take approximately 20 working days.
| No. | Description |
Estimated Duration (Working Days) |
|---|---|---|
| 1 | Approval of company name at the Ministry of Law and Human Rights | 4 |
| 2 | Approval from Indonesia Investment Coordinating Board (BPKM) | 12 |
| 3 | Preparation of Article of Association by Notary (Akta) | 4 |
| 4 | Obtain a Domicile Letter at the local government office | 3 |
| 5 | Obtain Tax Identification Number (NPWP) | 3 |
| 6 | Open an account in a bank on behalf of your company | 1 |
| 7 | Obtain the deed of establishment for your company | 20 |
| 8 | Obtain a company registration certificate from the local government | 20 |
What is next after Obtaining a Business Registration Number in Indonesia?
After your company is established, you can start running your business in Indonesia and conduct activities such as:
- Open an Indonesia corporate bank account
It is possible to open an Indonesia corporate bank account without being physically present in Indonesia. - Rent or buy property and other assets on behalf of your company
However, after obtaining the business registration number for your company in Indonesia, you will be required to choose a location to set up your physical office in Indonesia. Do note however that you would be required to refer to the Negative Investment List for your business location as some business activities are prohibited in certain areas. - Start other preparations for your operation, such as but not limited to hiring staff, preparing office renovations, etc.
And also you should have already planned out how your operations are going to take place in your company. Planning out and starting your operations once your company is set up would save you lots of money and time. - Proceed to obtain work and stay permits for foreign employees in your company
Basically, you would be required to figure out how many foreign employees you will be hiring in your company. This is crucial as you would be required to comply with regulations about obtaining the work permit for your foreign workers.
FAQs
A Single Entry 60-Days Business visa is given to a citizen of a foreign country who would like to visit Indonesia for business purposes. This visa is valid (must be used) within 90 (ninety) days from the date of issuance, the 60-days stay permit starts from the date the traveler enters Indonesia.
The incorporation process usually takes 1-2 months, but this is an estimation and the time required is on a case-by-case basis.
Incorporating your company gives you the authority to manage your company and other jurisdictions supported by Indonesia.
Indonesia company registration number is a unique number assigned to every business that is legally incorporated in the country. Furthermore, having a company registration number means that your business is recognized and protected under Indonesian law.
