Home Blog An In-Depth Look to Dissolving a Company in Indonesia Business Setup | Company Dissolution | Indonesia | Jakarta An In-Depth Look to Dissolving a Company in Indonesia InCorp Editorial Team 24 April 2025 7 minutes reading time Table of Contents Reasons for dissolving a company in Indonesia Liquidation – the essential part of disolving a company in Indonesia How to wind up PT or PT PMA Dissolution of Representative Office Liquidation services for dissolving a company in Indonesia Indonesia with its growing economy and a huge market is literary an archipelago of opportunities. Launching a new product, investing in one of the promising industries or doing business in import/export could be highly profitable under the condition that all the prerequisites are met. Yet, not all entrepreneurs succeed with their business ideas and they find themselves facing the necessity for dissolving a company in Indonesia. Reasons for dissolving a company in Indonesia By decision of General Meeting of Shareholders (GMS) The shareholders have indeed the right to close the company if they agree on and rightfully vote in favour of it. The dissolution proposal can be submitted not only by the Board of Directors or Board of Commissioners but even by shareholders who represent at least 1/10 of the total shares with voting right. In order to approve suggested dissolution the consensus of at least 3/4 of the total shares with voting right is needed. By decision of court A company can be forced to end its activity by a court order. There is a row of reasons that could lead the court to such a radical verdict. Violation the public interest, taking an action that contravenes current legislation, being inactive for more than three years or ending up in the bankruptcy are just a few of them. In this case, a liquidator responsible for the whole process would be appointed directly by the court. If the period of incorporation expires The period of incorporation is usually not limited. However, in rare cases, it might have a certain validity, and a company must apply to renew it to continue in business activities. Failing to do this, leads to its dissolution once this period is over. The GMS is obliged to appoint a liquidator with 30 days period, and the management is not supposed to take any further legal actions. By revocation the business permit In case the granted business license is revoked the company loses the legal base for its existence and must conduct liquidation. It happens mostly in specific and heavily regulated fields Liquidation – the essential part of disolving a company in Indonesia Dissolution of a company in Indonesia is regulated by the article of 143 of Law No. 40 Year 2007. It is important to bear in mind that it does not pass out of existence by terminating its activities. It continues to be regarded a legal entity until the process of dissolution, which consists of a series of legal steps, is finished. The main task in the process of closing down a business is to settle nd clear the assets and liabilities – liquidation. In order to avoid any additional problems that may arise from incorrect dissolution, it is recommended to carry out the whole process carefully and with the help of experts. How to wind up PT or PT PMA To scrutinize the whole process of dissolving a business in Indonesia, we will have a look at the procedure for the most common company types – PT (Limited Liability) and its counterpart PT PMA intended for foreign investors. Termination of both forms come under the same guideline. Dissolution proposal As previously mentioned there must be initiative either from inside the company (management, shareholders) or an authority intervention (court order). Appointment of liquidator The person who is going to handle the liquidation can be appointed directly by GMS or is chosen by the court depending on whether the liquidation is voluntary or compulsory. Announcement of liquidation The liquidator is supposed to inform about the dissolution of the company through the daily newspaper and also State Gazette of the Republic of Indonesia. The aim is to notify all creditors who can claim any potential debts as well as the Ministry of Law and Human Rights. The announcement must be published within the 30-day period after the decision of dissolution was taken. The creditors may claim the outstanding amount during the 60 days following the issuance of notification in the newspaper. Settle remaining accounts receivables and claims The liquidator collects all the remaining assets the company still might have for unpaid goods or services and satisfies the creditors at the same time. Any potential surplus is divided among shareholders according to the proportion of their shares. This step is accompanied by the a second announcement in newspaper that reveals the assets distribution plan that was approved beforehand by both the GMS and the Ministry of Law and Human rights. Reporting the result of liquidation The outcome of the liquidation is reported either to GMS or court. In addition, the tax office should be informed, so the company’s Tax Registration Number (NPWP) can be revoked. The final announcement that the company ceased to exist The third and the final notice that the company does not exist anymore should be published in a newspaper. It is vital to submit a confirmation about liquidation to the Company Registry of the Ministry of Trade at the same time to terminate the company registration certificate. PT PMA should also apply to Investment Coordinating Board (BKPM) to revoke its business or principal license. Only by fulfilling the above-mentioned steps the company is considered as dissolved. The whole process may take approximately 8 – 10 months but in some cases even up to one year. Dissolution of Representative Office Representative Office (RO) is another widely used form of legal entity open to foreign citizens in Indonesia. Its activities are, however, limited to managerial support of the parent company located abroad or it serves as a first stage on the way towards establishing PT PMA in the future. It must not carry any business activities in Indonesia on its own which means that, unlike the limited company, it does not go through the process of liquidation upon its dissolution and it is therefore simpler. Having said that, it is still necessary to follow required procedure once the management decides to close the RO down. The steps that lead to the closure of Representative Office are as follows: Termination of Principle License to BKPM Investment Coordinating Board is asked to revoke the principal license of the RO. Termination of Domicile Letter Before the RO can be winded up, the government must be informed about leaving the official address of the office by termination of Domicile Letter. Termination of Tax ID A tax office will delete Tax Identification Number (NPWP) upon the request. This is a crucial step because RO will not be exempted from the tax reporting obligation unless the financial authority is officially notified that it has ceased to exist. Termination of Company Registration Certificate Company Registration should be terminated with the Ministry of Trade. The time frame for dissolution of RO is between five months and one year. Liquidation services for dissolving a company in Indonesia As we outlined above, to dissolve a company in Indonesia is rather a complex task. In fact, it requires more effort than its registration. We cannot stress more the importance of liquidation that must be done properly to avoid further financial claims and legal disputes. To make sure that the company will be closed down successfully and you will free yourself from all legal obligations, it is essential to put an experienced professional in charge of the whole process. Cekindo can take a role of the liquidator and provide you with all the necessary assistance. We will help with the completion of the crucial documents, notification of authorities involved and announcements in newspaper and State Gazette. As a liquidator, Cekindo will take care of recording company’s properties according to the financial statement. We will also prepare the record of accumulation of wealth and debts to settle up with creditors or issue the article of dissolution that states the result and accountability of liquidation process. Contact us for further details and tailor-made plan that will suit your company best. Read Full Bio Verified by Ales Cina Consulting Manager at InCorp Indonesia Aleš manages solution delivery at InCorp Indonesia, optimizing incorporation processes and client relationships. His experience in internal auditing, retail, and sales offers valuable global insights. Aleš, with a degree in Economics and Finance from the Czech Republic, helps clients navigate cross-border business challenges, focusing on cultural and legal insights. Frequently Asked Questions How do investors choose a holding jurisdiction for a PMA firm in Indonesia? Investors considering investments in Indonesia should assess existing International Investment Agreements between Indonesia and other countries. Having a business presence in countries with such agreements may offer incentives like stronger investment protection and higher foreign shareholding in Indonesia. What is the Indonesian employment status in PMA company? In Indonesia, employment arrangements are categorized into temporary employment agreements (PKWT) and permanent employment agreements (PKWTT). Temporary contracts are for short-term, seasonal, or experimental work, while permanent contracts are for continuous employment. How to conduct a company registration in Indonesia for a foreigner? A foreign-owned company (PT PMA) in Indonesia is a popular choice among foreigners to set up a business. Foreign investors must check Indonesia’s Positive Investment List to see which businesses are open to foreign direct investment. What kind of license does a PMA company need to get? In Indonesia, the licensing system has been updated with the implementation of the Omnibus Law. Businesses are categorized into four risk levels based on the PMA company classification. Licensing requirements vary accordingly, with three main types: Business Identification Number (NIB) Low-risk businesses needing only an NIB Standard Certification Standard Certification is necessary for medium-low and medium-high-risk businesses Licenses/Permits High-risk businesses require licenses/permits Additionally, basic requirements, including business location, must be met. Many licensing processes are facilitated through the Online Single Submission (OSS) platform managed by the Investment Coordinating Board (BKPM). Get in touch with us. Lead Form Contact Full NameEmailPlease provide corporate email where possiblePhone NumberOffice SetupWhich city are you planning to expand into?JakartaSemarang/Central JavaBali/LombokBatam/SumateraSurabaya/East JavaOther ProvincesType of Service- Please Select -[SPECIAL PACKAGE] Company Registration + Office Package (20% OFF)[SPECIAL PACKAGE] Product Registration + License Holder (20% OFF)Business SetupAccounting and TaxHR & Payroll servicesImmigration ServicesProduct Registration and ImportCompliance and Secretarial ServicesBusiness AdvisoryMore ServicesType of Service- Please Select -[SPECIAL PACKAGE] Company Registration + Office Service (20% OFF)[SPECIAL PACKAGE] Comprehensive Industrial Package (15% OFF)Business SetupAccounting and TaxHR & Payroll servicesImmigration ServicesProduct Registration and ImportCompliance and Secretarial ServicesBusiness AdvisoryMore ServicesType of Service- Please Select -[SPECIAL PACKAGE] Company Registration + Office Service (20% OFF)[SPECIAL PACKAGE] Comprehensive Industrial Package (15% OFF)Business SetupAccounting and TaxHR & Payroll servicesImmigration ServicesProduct Registration and ImportCompliance and Secretarial ServicesBusiness AdvisoryMore ServicesType of Service- Please Select -[SPECIAL PACKAGE] Company Registration (25% OFF) + Office Space (Private Office 30% OFF)[SPECIAL PACKAGE] Company Registration + Investor KITAS (25% OFF)[SPECIAL PACKAGE] Accounting + Tax Services+ Annual Fintax Report (20% OFF)[SPECIAL PACKAGE] Payroll Services for Executive Role (20% OFF)Business SetupAccounting and TaxHR & Payroll servicesImmigration ServicesProduct Registration and ImportCompliance and Secretarial ServicesBusiness AdvisoryMore ServicesType of Service- Please Select -[SPECIAL PACKAGE] Company Registration (20% OFF) + Office Service (25% OFF)[SPECIAL PACKAGE] Company Registration + Micro Finance Services (25% OFF)[SPECIAL PACKAGE] Property Assistance: Due Diligence + AJB Purchase/Lease Agreement (25% OFF)Business SetupAccounting and TaxHR & Payroll servicesImmigration ServicesProduct Registration and ImportCompliance and Secretarial ServicesBusiness AdvisoryMore ServicesType of Service- Please Select -Business SetupAccounting and TaxHR & Payroll servicesImmigration ServicesProduct Registration and ImportCompliance and Secretarial ServicesBusiness AdvisoryMore ServicesServices Company Registration Renting Virtual and Serviced Office Business and Import Licenses Corporate Recovery and Insolvency Closing of Company (Dissolution) Land and Property Ownership Shelf Company Local NomineeServices Accounting and Tax Reporting Audit and Review Transfer Pricing Compliance Tax RefundHuman Resource Sub Services Payroll Outsourcing Employer of Record Recruitment and HR Establishment Employment ServiceServices Business Visa Work Permit and KITAS Dependent Visa (Spouse and Family) OtherBusiness Visa Subservices Business Visa Visit Visa Visa ExtensionServices Medical Device Beauty (Skincare and Cosmetic) Food and Beverage Health Supplement Household Product Halal Certification TrademarkServices Legal Consultation Legal Agreement Service Due Diligence and Background Check Company Documents RevisionBusiness Advisory Business Advisory Services ESG Reporting & Advisory Internal Audit Risk ManagementMore Services Market Research and Analysis Local Distributor and Partner Bank AccountMessageSubmit What you’ll get A prompt response to your inquiry Knowledge for doing business from local experts Ongoing support for your business Disclaimer The information is provided by PT. Cekindo Business International (“InCorp Indonesia/ we”) for general purpose only and we make no representations or warranties of any kind. We do not act as an authorized government or non-government provider for official documents and services, which is issued by the Government of the Republic of Indonesia or its appointed officials. We do not promote any official government document or services of the Government of the Republic of Indonesia, including but not limited to, business identifiers, health and welfare assistance programs and benefits, unclaimed tax rebate, electronic travel visa and authorization, passports in this website. More on Business Setup Steps to Obtaining an AMDAL in Surabaya for a Company Read more How to Open a Restaurant in Semarang Read more Opening an E-commerce Company in Indonesia Read more