GENERAL INFORMATION
Indonesia, officially the Republic of Indonesia, is a country in Southeast Asia and Oceania. Indonesia achieved independence from the Netherlands in 1949. The nation's capital city is Jakarta.
Indonesia is Southeast Asia’s largest economy and has delivered consistently high annual growth. It has a well-diversified trading economy with oil and gas being the country’s largest export followed by other mining products, palm oil, agricultural products etc.
Indonesia is an attractive investment destination. Abundant natural resources, a large and growing domestic market combined with an improving investment climate, and technically trained work force are a few of the country’s salient advantages.
Other basic facts: | Time zone | Greenwich Mean Time +7 |
Official language | Bahasa Indonesia. English is also commonly used | |
National currency | Rupiah (IDR) |
KEY CORPORATE FEATURES OF WHOLLY-OWNED FOREIGN INVESTMENT COMPANIES (PMA) IN THE FORM OF LIMITED LIABILITY (PT)
| TYPE OF COMPANY | |
| Penanaman Modal Asing, or PMA | This is the only type of company allowed for foreign investment. It must take the form of a limited liability company (PT). Foreign entrepreneurs can set up a PMA in Indonesia either by setting up:
|
| Shelf company availability | No |
| Estimated time for incorporation | 3 to 6 months |
| SHARE CAPITAL | |
| Permitted currencies | Rupiah (foreign currency equivalent may be stated in brackets in the Articles of Association for the purposes of future capital repatriation) |
| Minimum issued capital | At least 25% of the approved authorized capital must be issued and paid-up or minimum of USD100,000 |
| Authorised capital | No formal minimum capital requirements. The amount of capital to be invested in a foreign-owned company is subject to approvals by the Investment Coordinating Board (BKPM) based on the commercial feasibility and scale of the project |
| Par / nominal value | Yes |
| DIRECTORS | |
| Minimum | One (1) |
| Corporate director | Not allowed |
| Local director requirements | Non-Indonesian citizens may not be directors in a PMA unless an expatriate resident in Indonesia with a work permit sponsored by that company |
| Location of meeting | Indonesia or place where the company has its business activities |
| Minimum number of meetings | Per Articles of Association |
| Publicly accessible records | Yes |
| SHAREHOLDERS | |
| Minimum | Two (2), which may be a combination of two individuals, two corporate or a combination |
| Bearer shares | Not Allowed |
| Corporate shareholders | Allowed |
| Local shareholder requirements | A foreign investment company may be 100% foreign-owned, whereby the minority shareholder must hold at least 1% or have an investment of USD1,000. However, there are restrictions on foreign ownership in certain business sectors (eg. investment in infrastructure) which requires a proportion of Indonesian shareholding. A 100% foreign-owned PMA is required to sell at least 5% of the company’s share(s) to an Indonesian citizen or entity within 15 years of commercial start-up. |
| Location of meeting | Indonesia |
| Minimum number of meetings | One (1) annually |
| Publicly accessible records | Yes |
| COMPANY SECRETARY | |
| Minimum | Not required |
| REGISTERED OFFICE | |
| Requirements | None. A foreign investment company is basically free to choose where in Indonesia they will set up operations |
| ACCOUNTS | |
| Records | Kept in Indonesia |
| Preparation of accounts | Yes |
| Audit requirements and filing | No requirement to prepare audited financial statements unless assets of the company exceed Rp.25 billion |
| Publicly accessible records | No |
| ANNUAL REQUIREMENTS | |
| Annual return | Yes |
| Tax return | Yes |
| GENERAL | |
| Legal system | Civil Law |
| Corporate re-domiciliation | No |
| Double taxation treaty access | Yes |
| Exchange control | Yes |
| Taxation | Corporate tax rate of 25% on taxable profits |
The information in this document is not advice of any kind but general information only and should not be relied on as legal advice. Kensington Trust Group recommends seeking professional advice on legal or tax issues affecting you before relying on it. While Kensington Trust Group tries to ensure that the content of this document is accurate, adequate or complete, it does not represent or warrant, express or implied, its accuracy, correctness, completeness or use of any of the information. Kensington Trust Group does not assume legal liability for any loss suffered as a result of or in relation to the use of this document. To the extent permitted by law, Kensington Trust Group excludes any liability for negligence, for any loss, including indirect or consequential damages arising from or in relation to the use of this document.