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Setting Up a Local PT Company

Setting Up a Local PT Company Review by Michal Wasserbauer on 5. 10. 2016 Company Registration in Indonesia, Market Research in Indonesia, Work Permit in Indonesia, Product Registration in Indonesia, Local Partner Selection in Indonesia, Trade Mission in Indonesia, Company Formation in Indonesia, Company Establishment in Indonesia, Company Set Up in Indonesia, Payroll Outsourcing in Indonesia, Tax Reporting in Indonesia, Medical Product Registration in Indonesia, Medical Device Registration in Indonesia, Cosmetic Registration in Indonesia, Food Supplement Registration in Indonesia.
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Set Up A Local PT Company in Indonesia

PT is the most popular company type in Indonesia. In fact, this type is fully intended for Indonesian only, but for a certain situation, it can be setting up for the foreign investors. For Local PT Company there are more options how to get it – read more about Local nominee company or Shelf company.

Why foreigners need to establish a local PT company in Indonesia where there are PT PMA and Representative types available?

According to the business activities, there are several business fields which are closed for foreign ownership. Check the updated negative investment list to see what are the forbidden business fields for foreigners. Thus the alternative solution is foreign investors can establish a local PT company to start a business in Indonesia.

The general minimum requirement to establish a local PT company are as follows:

  • 2 shareholders
  • 1 local Director
  • 1 Commissioner

 

This type of company only allowed 100% Indonesian citizen ownership, hence you will need Local Nominee for setting up this local PT company. Local nominee company is a solution for foreign investors who want to expand the business in Indonesia but hampered by limited ownership for specific business areas. So they can get a local shareholder nominee to represent a partial ownership for a certain number, but in real condition, the foreign investors get a full ownership. Cekindo can help you to provide a local shareholder nominee with notarized nominee agreement, contact us for details.

 

Size of Local PT Company

To set up a local PT company you have to invest some amount of money, the range is from IDR 50,000,000 up to more than IDR 10,000,000,000. Based on the amount of paid-in capital, local PT company divided into 3 sizes:

  • Small : above IDR 50,000,000 – 500,000,000
  • Medium : above IDR 500,000,000 – 10,000,000,000
  • Large : above IDR 10,000,000,000

 

Can a local PT company hire a foreign employee?

Yes, it can. For the local nominee company (foreign ownership) the required company size is medium at least, with paid-in capital above IDR 1,100,000,000. Find out how to get a business visa and work permit in Indonesia.

The Process of Setting Up a Local PT in Indonesia

Establishing a local PT company will take about 47 working days. You can check the detail process below:

Obtain Deed of Establishment at the Ministry of Law and Human Rights3Obtain Certificate of Domicile at the local government office15Obtain Taxpayer registration number (NPWP) and VAT number at the tax office (Check out tax reporting deadlines, warnings, and recommendations in Indonesia)

No.ProcedureDuration (working days)
1.Approval of company name at the Ministry of Law and Human Rights2
2.Preparation of Association Article by Notary4
3.Obtain Deed of Establishment at the Ministry of Law and Human Rights3
4.Obtain Certificate of Domicile at the local government office15
5.Obtain Tax payer registration number (NPWP) and VAT number at the tax office (Check out tax reporting deadlines, warnings, and recommendations in Indonesia)3
6.Obtain Trading Business License (SIUP)10
7.Obtain Company Registration Certificate (TDP) at the local government10

If you are not sure what type of company which is suitable for your business, feel free to contact us. Cekindo will assist you to establish your business from the start in Indonesia based on your customized needs. You can subscribe our newsletter to get the updated information regarding business in Indonesia, once a month.


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