Business plans

Learn the Types of Companies in Indonesia

Becoming a foreign investor anywhere requires knowledge before investment. The market needs to be studied to get a good idea of what you’re going to face. As an investor in Indonesia, you have the choice of the company formation in Indonesia in one of the following ways.

  • Indonesian LLC

Indonesian LLC refers to the Indonesian Limited Liability Company. These companies are established and run by local Indonesians. Two or more investors in these types of companies need to be Indonesian nationals. These types of companies target the local Indonesian population, and as such, one manager and one commissioner are a prerequisite. The commissioner can be a foreign national.

  • Foreign-owned LLC

If a foreigner wishes to establish and run a company in Indonesia, they can do so by creating a Foreign-owned LLC. These companies can get a work permit by securing an investment that is entirely foreign or partially foreign.

Two stockholders, a resident manager and a representative or a commissioner are required for registering a foreign-owned LLC as per law. It’s important to note that an entirely foreign-invested company needs to secure a minimum of 5% share to a citizen or a legal entity within a period of 15 years of its establishment.

  • Nominee LLCs

Foreigners can also set up businesses in the form of nominee LLC’s in Indonesia. In cases where special businesses or situations arise for rapid issuance, nominee LLC’s can be set up. These help entrepreneurs buy real estate properties. For more information on these types of LLCs contact

  • Public companies (Perum and Persero)

Public companies in Indonesia can be set up under two umbrellas. These are Perum or non-profit and Persero or Stock Trading

Non-profit (Perum) companies are entirely state-owned in Indonesia, and they abide by the Civil Code of the country. These companies are usually set up for social or the state’s economic reasons. Regardless of the reason, a Perum company is considered to be a legal entity. Its employees are all considered as employees of the Indonesian state.

The Persero company takes the form of a regular LLC. All the rules and regulation that a Persero must follow are the same as that of any other Limited Liability Company operating in Indonesia.

  • Representative offices in Indonesia

Representative offices are a good option for many foreigners hoping to invest in Indonesia. Representative offices allow a parent company to perform market research, trade and promote themselves by creating outlets. This is an easy and convenient way for many foreign companies to enter the Indonesia market without going through the trouble of creating an LLC. Establishing branches is not allowed in Indonesia and, hence, foreigners can establish a representative office instead.

If you wish to find out more about Indonesian KITAS and doing business in Indonesia contact them now.

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