Basic incorporation requirements
Depending on the type of company that you are going to set up, there are different sets of requirements that you must comply with. The requirements consist of:
- Minimum Capital
- Visa and Work permits; and
- Tax Compliance
Types of companies in Indonesia and its requirement
There are six (6) different types of companies are available in Indonesia:
1. Perseroan Terbatas(PT)
Perseroan Terbatas (PT) is a local term referring to a limited liability company, and it is the most common foreign company option incorporated in Indonesia. It exists in three categories.
- Large-sized PT Company
The paid-up capitals vary depending on the category, and they are established upon the approval from the Capital Investment Coordinating Board. Most local and foreign investors with permanent residency employ this option.
This type of Business Company is easy to set up, and it offers limited liability for most foreign entities and local entities as it supports work visas. Features:
- One local director
- Two local shareholders
- A foreign or local commissioner
2. Perseroan Terbatas Penanaman Modal Asing (PT PMA) / Penanaman Modal Asing (PMA)
Perseroan Terbatas Penanaman Modal Asing (PT PMA) / Penanaman Modal Asing (PMA) can be fully or partially foreign-owned. Such a company is established under the stipulated regulations of Foreign Capital Investment Law and approved by the Capital Coordinating Board of Indonesia. PMA companies can be converted into public companies later.
3. Kantor Perwakilan Perusahaan Asing (KPPA)
Kantor Perwakilan Perusahaan Asing is a foreign representative office, and it takes 3-4 working weeks of the registration process. This company registration type is suitable for investors who want to study the Indonesian market for research and business-related development purposes. They serve as the parent company’s buying and selling agent. However, it is restricted to certain business regions such as services, banking, trading, mining, gas, and oil.
4. Representative office for trading (KP3A)
This is a foreign trade representative office.
5. Nominee Limited Liability Company
When you want to begin operations immediately, you can register a company in Indonesia using an Indonesian nominee. Registering this type of company enables you to bypass some foreign investment restrictions, close deals fast, and obtain contracts.
6. Public company
This type of company is required to adhere to stringent company registration regulations. It has at least 300 shareholders and a paid-up capital of IDR billion. It is a requirement to be listed under the stock exchange.