Anyone considering pursuing a business in Bali will sooner or later come to the conclusion that it is essential to have official representation on the island. Local office address will add credibility to your company, facilitate communication with your partners and give a solid base for the future growth of the business.
How to find the right place for you?
Business activities conducted by a foreigner in Indonesia can be based on one of the two legal entities. You can either register a limited company with foreign capital – PT PMA or open a representative office. Both of them have their advantages and limitations that we deal with in details in another article.
However, the bottom line for both is the necessity of a business address in Indonesia. It will allow you to obtain the domicile letter that is required by authorities during the company/representative office registration process.
In order to meet the requirement of having your own business address, you do not necessarily have to rent a fully furnished office with a company’s name on its door. The real estate market can be tight, especially in some popular areas of Bali.
Yet, there is a couple of options the entrepreneurs in Bali can choose from to lower the cost of acquisition or renting an office.
A virtual office is a cost-effective solution if all you need is the compulsory domicile letter. Cekindo, however, adds to its virtual offices also calls and mail handling services, and meeting and conference rooms are available on demand.
Co-working space or private offices that come with all you can need. Whether you use the office on a regular basis or just once in a while, work individually or in a team, our Bali serviced offices can accommodate you and meet all your expectations.
To set up a regular office, where the property, furniture and other equipment, administrative support, etc. are all arranged by the company itself, is more complicated than the options mentioned above. It is suitable mainly for large and well-established businesses.
Long-term renting of a property is popular in Bali. The exact period of the contract can be set individually, but as a rule of thumb the longer a property is under the lease, the more budget-wise the conditions are.
The leasehold agreement for an office should include as many details as possible to specify rights and duties of both parties – the lessee and the lessor.
Once the company has achieved a strong position within the local market and have a bright prospect for the future the owner can decide to obtain the Right to Use certificate (Hak Pakai).
This document allows its holder to exploit land and/or property built on it for purposes determined in advance. The right expires after 25 years but can be extended up to 80 years in total as long as the tenant still complies with all requirements.
Should the company prefer a brand new office building that would perfectly suit its needs, it can build its own property as a holder of Right to Build certificate (Hak Guna Bangunan). The document is issued for initial 30 years, and the extension is possible for another 20 years.
Nevertheless, even after the first 50 year period is over, re-applying under the same conditions is possible. It should be noted that this is a rather expensive way of securing a company’s administrative facilities.
Please be aware that limited liability companies (PT PMA) only are eligible for obtaining property on the basis of the Right to Use and Right to Build.
Shall you need more information about property rights foreigners have in Bali or how to find an office in Bali, please do not hesitate and contact us.
