A Complete Guide of Indonesia Company Registry

A Complete Guide of Indonesia Company Registry

  • InCorp Editorial Team
  • 31 January 2024
  • 6 reading time

The Indonesian government has taken significant strides to improve the ease of doing business through regulatory changes, positively impacting business and company registration in Jakarta and other cities. One such initiative is issuing the Positive Investment List (PIL) in early 2021.

The initiative outlines economic sectors and lines for foreign investment, replacing the Negative Investment List. This article aims to guide foreign investors on leveraging the Indonesia Company Registry and conducting due diligence for successful business ventures in Indonesia.

What is the Meaning of Company Registry

A company registry is an official list that compiles information about all companies within a country. This includes details such as the company’s status, capital, shareholder information, and the company’s history.

What You Need to Know Before Your Indonesia Company Registration

Registering your company in Indonesia involves navigating various legal and administrative processes. Before proceeding with the registration, here are some key points you need to be aware of:

1. Business Objectives

    Determine detailed aspects of your business, including its structure, legal entity form, industry classification, operational address, etc.

    2. Eligibility and Restrictions

    Understand the eligibility criteria and any restrictions associated with your chosen business structure. For foreign investors, especially, it is crucial to determine whether you can establish your company in a specific industry and the requirements involved.

    3. Company Name

    Ensure that your company name complies with certain criteria, such as containing a minimum of three words, being written in Roman letters, being unique, not including numbers or series of numbers, and being appropriate and non-offensive.

    4. Share Capital, Shareholders, and Directors

    Determine the share capital within your company, particularly if it involves foreign investment. Foreign-invested companies may have specific requirements, and restrictions based on the Indonesia Negative Investment List (DNI) need to be considered.

    5. Indonesia Company Registration Certifications, Licenses, Identifications

    Be aware that various approvals, licenses, and identifications are required during the establishment of the company in Indonesia. These may include a Deed of Incorporation, Business License, NIB, TIN, etc.

    Navigating through these considerations will help ensure a smoother and compliant company registration process in Indonesia.

    How do I Register a Company in Indonesia?

    To establish either a local company or PT PMA in Indonesia, follow these key steps:

    1. Set the name of your company, ensuring it consists of three words, and await approval.
    2. Once approved, obtain your Deed of Incorporation, including your company’s Articles of Association.
    3. Submit the Deed of Incorporation to the Ministry of Law and Human Rights and await approval.
    4. Register your Tax ID (NPWP) for a secure and legal business process in Indonesia.
    5. Provide the location of your business.
    6. Apply for an NIB through the OSS platform for the individual business license.
    7. Prepare any other licenses required for your specific business sector.

    How to Find NIB Indonesia?

    The Indonesian Ministry of Investment (BKPM) operates a system that integrates business permit information in Indonesia. The Indonesia company registration number can be accessed through the NSWI (National Single Window for Investment) website by entering the NIB (Nomor Induk Berusaha) number into the tracking menu. This process allows you to view the real-time status of the company.

    How Can I Verify a Company in Indonesia?

    To verify a specific company through the Indonesia company registry, the Ministry of Law and Human Rights provides the SIMBA system (Sistem Informasi Manajemen Administrasi Badan Hukum), which serves as a database for registered companies in Indonesia. Follow this step-by-step guide to access the SIMBA platform:

    • Visit the official website of the Ministry of Law and Human Rights.
    • Use one of the following criteria to search for companies:
      • Company Name
      • Registration Number
      • Tax Identification Number (TIN)
    • Access the company’s basic information, including the registered address, director, and shareholders.

    What to Know About Indonesian Company Registry

    There are five points to consider in understanding the company registry in Indonesia.

    1. Understanding the Positive Investment List (PIL) 

    The Positive Investment List introduced by the Indonesian government provides opportunities for foreign investors to participate in previously restricted industries. While specific sectors now allow 100% foreign ownership, PIL designates a range of business lines as “Reserved for Cooperatives and MSME.” 

    For foreign companies seeking expansion into these lines of business, forming local partnership arrangements with Indonesian companies is a requirement.

    2. Leveraging the Indonesia Company Registry

    The Indonesia Company Registry, managed by the Ministry of Human Rights and Legal Affairs, is a valuable tool for foreign investors. The registry offers crucial company information, including legal entity type, business activities (KBLI), date of deed revisions, company domicile, shareholder details, and more. 

    To access the registry, visit ahu.go.id, type, search for the desired company, fill out the information request form, and proceed with payment. The requested information will be sent via email.

    READ MORE:

    3. Conducting Due Diligence and Background Checks

    While the Indonesia Company Registry provides initial company profile research, conducting due diligence is essential for evaluating potential risks before making significant investments. Due diligence offers a comprehensive report on the specific company, its business partners, and past or potential threats. 

    By gaining a deeper understanding of the target company or potential business partner, foreign investors can assess their suitability and reliability for future partnerships.

    Indonesia Company Registry

    4. Outsourcing Due Diligence Services

    Outsourcing due diligence to professional service providers offers several benefits to businesses: 

    • Mitigating the risk of unfavorable business conditions. 
    • Leveraging the expertise of highly experienced professionals familiar with the local market. 
    • Saving time and money allows companies to focus on core business activities.
    READ MORE:

    5. Choosing a Trusted Due Diligence Partner

    For reliable due diligence services in Indonesia, InCorp Indonesia’s Indonesian Due Diligence specialists can provide critical insights. They cater to various industries, including financial services, manufacturing, oil and gas, trade and distribution, healthcare, technology, tourism and hospitality, and e-commerce. 

    By partnering with InCorp Indonesia, businesses can make well-informed decisions, determine the actual worth of their investments, and negotiate favorable conditions for their deals.

    Save Your Time and Let InCorp Indonesia Assist You

    If you want to analyze businesses and know more than what the stats say, InCorp Indonesia’s due diligence team can assist you in reviewing your possible investments.

    Our Indonesian Due Diligence specialists can offer you critical information to help you make informed decisions, such as determining the actual worth of your investment and negotiating the best conditions for your deal.

    Our consultants have helped companies across various industries, including financial services, manufacturing, oil and gas, trade and distribution, healthcare, technology, tourism and hospitality, and e-commerce, to name a few.

    Daris Salam

    COO Indonesia at InCorp Indonesia

    With more than 10 years of expertise in accounting and finance, Daris Salam dedicates his knowledge to consistently improving the performance of InCorp Indonesia and maintaining clients and partnerships.

    Get in touch with us.

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    Frequent Asked Questions

    As their names suggest, the main differences between the three business kinds in Indonesia lie in the businesses and the purpose of their incorporation. Local company owners (PT) must be Indonesian citizens, as even 1 percent of foreign ownership is not allowed. This type of company is not limited to entering any business field, and restrictions on incorporation are not so tight. On the contrary, a foreign-owned company (PT PMA) is open to international investors, but the maximal percentage of foreign shares differs in various business sectors. Contact InCorp to get the most updated information on the Negative Investment List. International investors tend to open representative offices as a first step to understanding the Indonesian market before setting up a limited liability company. This type is used for marketing and promotion activities and needs the right to sell directly and receive income.

    There are three things business owners need to consider before setting up a business in Indonesia: the type of business entity, capital requirements, and regulations.

    Indonesian regulations separate local companies from foreign companies. Generally, foreign-owned companies (PT PMA) have more limitations than their local counterparts (Local PT). However, to pursue more foreign direct investment in the country, the government has taken several bold initiatives to increase the ease of doing business and provide numerous attractive incentives for foreign investors.

    Yes, this mainly applies to import and export businesses. Instead of establishing a company, you can use an under-name import service, an importer of record.

    It should take between 30 to 45 days.