Establish a Branch in Indonesia

Updated on Saturday 04th November 2017

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Unlike other countries which allow foreign companies to create subsidiaries, branch offices and representative offices, Indonesia is slightly different. Foreign companies are allowed to establish subsidiary companies and representative offices in this country. In order to compensate for the lack of an Indonesian branch structure, the government has created another type of company – the foreign-owned limited liability company (PT PMA). This business form can be employed by foreign companies seeking to have a subsidiary or a branch office in Indonesia.

Our company formation agents in Indonesia can offer information on all the structures available for foreign companies interested in doing business in this country.
 

Laws governing the establishment of fully-owned foreign companies in Indonesia

There are two main laws which provide for the establishment of a structure fully owned by a foreign company, which could cover the creation of a branch office in Indonesia. These laws are:

-          the Capital Investment Law;
-          the Company Act.

While the first law provides for foreign investments made in the country, the share capital required to set up a business in Indonesia and the requirements applied to foreign investors, the second one covers the company registration procedure in this country.

Our company registration consultants in Indonesia can assist with the incorporation of any business form chosen by a foreign company.
 

How to register a foreign-owned company in Indonesia

If it were acknowledged, the Indonesian branch office would be registered just like a subsidiary company. This would imply the parent company to file its certificate of incorporation and other relevant information about it with the Business Register, as well as an investment plan with the Capital Investment Coordinating Board.

From a taxation point of view, a foreign-owned company can benefit from various incentives granted by the government. Also, Indonesia has several special economic zones in which foreign-owned companies equivalent with branch offices can operate under very advantageous conditions.

Foreign companies interested in doing business in this country can obtain more information on the types of structures available from our Indonesian company formation advisors. You can also contact us if you want to open a company in Indonesia.

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