Home Blog Company Registration in Padang, Indonesia: A Handy Guide Uncategorized Company Registration in Padang, Indonesia: A Handy Guide InCorp Editorial Team 13 August 2020 4 minutes reading time Table of Contents Options of Company Registration in Padang Starting a Business in Indonesia with Cekindo Padang is no longer just a getaway for vacation seekers. It is now a dynamic business hub where global investors have gathered for starting a business in Indonesia. Many investment opportunities have emerged in Padang and the most prominent ones are in the tourism and hospitality sector. Recently, the Indonesian government even cut the BI 7-Day Reverse Repo Rate from 4.75% to 4.5%, directly reducing the capital cost for foreigners to invest in Padang. This article discusses the company registration options available in Padang for you to explore your business opportunities. Options of Company Registration in Padang Starting a business in Indonesian means that you have to satisfy several requirements and select the right entity. You can incorporate your company in Indonesia by choosing one of the legal entities below: Local Company (PT) Foreign Company (PT PMA) Representative Office (RO) Local Company (PT) Only locals or Indonesian citizens can establish and own a local company in Indonesia. The main characteristics of an Indonesian PT are 100% local ownership and a minimum capital investment of IDR 600 million to IDR 10 billion depending on the company size. According to the latest changes laid out in Job Creation Law, the classification of Local PT in Indonesia is based on paid-up capital as follows: A micro-enterprise: less than IDR 1 billion A small enterprise: IDR 1 – 5 billion A medium enterprise: IDR 5-10 billion A large enterprise: more than IDR 10 billion Foreign Company (PT PMA) A foreign company is another form of legal structure that is available for foreign investors. This company type is considered to be the most common for foreigners. Foreigners are allowed to carry out commercial business activities in Padang with a PT PMA. However, before starting a PT PMA in Padang, investors must verify if their business categories are prohibited for setting up a foreign company, or they can only own a certain percentage of share of their PT PMA in a specific sector. This information is available under the BKPM’s Negative Investment List that is updated from time to time. BKPM stands for Badan Koordinasi Penanaman Modal or Indonesia Investment Coordinating Board. A PT PMA in Indonesia features the following characteristics: Foreigners are permitted to be shareholders Minimum number of shareholders: Two Minimum paid-up capital: IDR 10 billion Minimum investment plan: IDR 10 billion Maximum foreign ownership: 100% May need an Indonesian shareholder, depending on the Negative Investment List Minimum requirement: one director and one commissioner Foreign employee sponsorship is permitted Tax reports and investment activity report must be submitted every month Representative Office (RO) A foreign parent company often establishes a representative office in Indonesia to manage its business in the country. It also serves as a stepping stone when the foreign company is getting ready to set up a PT PMA in Indonesia. However, a representative office can’t carry out sales transactions and profit-related activities. Starting a Business in Indonesia with Cekindo Nowadays, you face more and more government regulations and tax laws when starting a business in Indonesia. Over the years, Cekindo has been a supportive factor in the growth of companies from the very beginning. We can liberate you from all the rules and taxes legally possible and establish your company in Indonesia, including in Padang. Cekindo offers diversified and customised solutions for starting a business in Indonesia with a quick, easy, and clear process. We also help you process the paperwork and open your corporate bank account. Our professional team of experts will guide you through every step, to get your business up and running and make your goals a reality. Get in touch with Cekindo if you want to discover the best solution for your company establishment in Padang. Fill in the form below. Read Full Bio Verified by Daris Salam COO Indonesia at InCorp Indonesia With more than 10 years of expertise in accounting and finance, Daris Salam dedicates his knowledge to consistently improving the performance of InCorp Indonesia and maintaining clients and partnerships. Frequently Asked Questions How many incorporation types exist in Indonesia? In Indonesia, there are three company types that you can establish based on your business nature, requirements, and preferences. Local Company (PT): 100% local ownership. Foreign Company (PT PMA): can be entirely owned by foreigners; however, restrictions in business sectors apply Representative Office: a branch of the parent company overseas whose purpose is to conduct marketing-related activities without generating income or profits What is the difference between PT and CV? You can find the difference below: PT: limited liability company (shareholders are not legally liable for company liabilities) CV: a proprietary company where liability falls on the shareholders What other things should be considered when hiring local and foreign employees in Indonesia? There are a few things to consider, such as: Prohibit any form of discrimination and provide equal opportunity for Indonesians and expatriates Increase the competence of workers by giving or encouraging job training. Follow the termination procedures (Terminating an employee in Indonesia can be long, tedious, and expensive. Observe working hours, holidays, and overtime regulations Give mandatory employee benefits, including social security and health insurance Withhold only the right amount of income tax on behalf of the employees Follow the wages and other benefits outlined by the law Process work permits for foreign employees What is PT (Perseroan Terbatas)? PT (Perseroan Terbatas) is the Indonesian term for a limited liability company. Get in touch with us. Lead Form Updates 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 Mergers and Acquisitions 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.