General Guide to Company Incorporation in Indonesia

Updated on Wednesday 27th June 2018

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Foreign investors seeking to expand their business activities in Asian countries can choose Indonesia because this country’s economy is now thriving. The legislation allows for the establishment of limited liability companies, which are preferred by entrepreneurs all over the world, therefore setting up a company in Indonesia is simpler than in other Asian jurisdictions.

Our company registration consultants in Indonesia can offer more information on the types of structures available for incorporation in this country.
 

Company incorporation requirements in Indonesia

Before setting up a business in Indonesia, the shareholding structure of the company must be established. The local legislation provides for:
-          local companies which can be registered by Indonesian citizens;
-          foreign-owned companies.

The company registration requirements depend on the owners of the Indonesian company. The minimum share capital related to starting a company in Indonesia depends on the size of the company and spans between 3,700 USD and close to 38,000 USD for local limited liability companies. In the case of foreign-owned companies, the minimum amount of money required implies an investment plan worth at least 1,2 million USD. Out of these, at least 25% of the amount must be deposited as an initial share capital.

Opening a company in Indonesia also implies having a minimum number of 2 shareholders, at least one resident director and a commissioner. The commissioner may be a foreign citizen no matter the type of company registered.

Our company formation agents can offer more information on the additional requirements related to create a company in Indonesia.

Please watch our video on company incorporation in Indonesia:

Steps related to setting up a company in Indonesia


The first step for registering a company in Indonesia is to obtain the incorporation documents and the company name with the Ministry of Law and Human Rights. Following that, the statutory documents must be notarized.

The next steps related to the Indonesia company incorporation process imply:

-          paying the registration fee and obtaining the receipt which must be filed with the Trade Register;
-          filing the notarized documents with the Ministry of Law and Human Rights for approval;
-          applying for the business license with the relevant ministry or authority;
-          registering for employment purposes with the Ministry of Manpower in Indonesia;
-          registering for social security and purposes and obtaining the tax and VAT numbers.
 

Company registration timeframe in Indonesia

 
The following timeframe must be considered when incorporating a company in Indonesia as a foreigner:
 
 Procedure  Time
 Company name reservation   1 day
 Approval of the incorporation documents   10 days
 Drafting of the Articles of Association   2 days
 Obtaining approval from the Ministry of Law   1 day
 Obtaining a registered address   1 day
 Tax and VAT registration   5 days
 Obtaining the business license   5 days
 Obtaining a permanent license   10 days

 

Why open a company in Indonesia?

 
If you want to open a company in Southeast Asia and have not decided on a country yet, here is why you should choose Indonesia:
 
1.       Indonesia has made significant progress in easing the company registration procedure;
2.       foreign citizens and investors are now allowed to buy land plots in Indonesia;
3.       Indonesia has one of the fastest growing middle classes at a global  level which indicates a good state of the economy;
4.       Indonesia is the largest economy in the region with a GDP that grows annually.
 
 

For assistance in registering a company in Indonesia, please feel free to contact our local advisors.

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