Local-Owned Company (PT)
Some business fields have limitation for foreign ownership, therefore Local-Owned Company is one of the alternative and the minimum business investment is starting from US$5,000.
Setting up a Local Company (PT)
A company or Perseroan Terbatas (abbreviated to PT) is the most common form of business entity in Indonesia. It’s roughly similar to a Limited Liability Company in structure and function.
As a local-owned company (PT), only Indonesian citizens and Indonesian legal entities are allowed to hold shares as registered shareholders.
A local-owned company (PT)can operate a wider variety of business activities than foreign companies, both in terms of business fields and areas of operations.
Basic Requirements of a Local Company (PT)
Organizational Structure
The minimum organizational requirements to establish a local-owned company (PT) are as follows:
- 2 local shareholders (must be individual Indonesian residents and/or other local-owned companies)
- 1 director (at least there is 1 local director in the company)
- 1 local commissioner
Minimum Investment Value
Setting up a local-owned company (PT) requires an authorized capital.
A local-owned company (PT) can have three different sizes depending on their total projected investment value as follows:
- Small: IDR 50 million (±USD 3.500) to IDR 500 million (±USD 35.000)
- Medium: above IDR 500 million to IDR 10 billion
- Large: > IDR 10 billion
Note: To hire a foreign employee in a local PT company, your company size should medium size and we suggest with an authorized capital of above IDR 1 billion.
Document Requirements
- Proposed company name (three words in Bahasa Indonesia) and domicile of the company
- Purposes, objectives and business activities of the company
- Office Address and its lease agreement provided by the office provider
- Number of shares, share classes (if any), including the number of shares in each class, rights attached to each share, and nominal value of each share
- Structure of shareholders, directors, and commissioners of the company/legal entity. The shareholders and commissioners should be local residents of Indonesia.
If the shareholder is an individual
- Copy of Personal ID (KTP)
- Copy of Tax ID (NPWP)
If the shareholder is a company/legal entity
- Copy of Article of Association (AKTA)
- Copy of Deed of Establishment (SK Kemenkumham) showing the board of directors
Steps to Register a Local-Owned Company (PT)
| 1 | Register company name with the Ministry of Law and Human Rights. |
| 2 | Notarize Article of Association (AKTA Perusahaan). |
| 3 | Ratify the Deed of Establishment or Corporate Legal Entity (SK Kemenkumham) with the Ministry of Law and Human Rights. |
| 4 | Obtain company Tax Payer Registration Number (Tax ID or NPWP) with the local tax authority. |
| 5 | Obtain Single Business ID Number (NIB) from Online Single Submission (OSS). |
| 6 | Obtain the other business licenses (if the business classification requires another license) via Online Single Submission (OSS) such as Commercial License for specific business classifications. |
| 7 | Register for the other respective commitments for employee requirements via Online Single Submission (OSS) such as national social security insurance (BPJS) and Employment Report (WLK). |
Get a Quote to Local-Owned Company (PT) Set up in Indonesia
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