Investing in Indonesia

Things to be considered in the company AOA: 

1. Domicile of the company

2. Field of business, 

3. Paid-up capital, 

4. Shareholder name and  share percentage of the shareholder (min. 2 shareholders) 

5. Name and composition of the board of directors and the board of commissioners.

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​After drawing up the deed of establishment of a Foreign Investment Company and obtaining a Decree of the Minister of Law and Human Rights on the validation of the establishment of a legal entity, a business actor will obtain a Taxpayer Identification Number (NPWP) automatically, or if a business does not obtain an NPWP automatically, a business actor may register an NPWP through electronic registration (e-reg). Furthermore, in order to obtain a physical NPWP card, a business actor must conduct a re-registration at the Primary Tax Office (Kantor Pajak Pratama/KPP) in the address area of the Foreign Investment Company.

To acquire OSS access rights business entity must prepare the following documents:

1. Company email address

2. Mobile number of the director/company

3. Decree of the Ministry of Law and Human Rights on the validation of the establishment of legal entity

4. NPWP of the company

5. KTP/passport of the director

The OSS system issues NIB as identity and legality in order to conduct business preparation automatically and is equipped with an electronic signature. NIB shall be issued based on the data entry of business actors and general business plans, results of examination of conformity of spatial utilization activities, and data entry of business activities. In addition, in the process of issuing the NIB, a risk-level validation process for the business activities shall also be carried out.

Mandatory documents:

1. Business sector data (KBLI)

2. Location data

3. Investment plan value

4. Workforce plan

5. Capacity plan

6. Self declare and verification
    

Basic requirements, including the conformity of spatial utilization activities (KKPR), building approvals (PBG), and building worthiness certificate (SLF), as well as environmental permit (EP) have to be fulfilled for the issuance of NIB.

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Definitions

• KKPR: Conformity of Spatial Utilization Activity is conformity between spatial utilization activity plan for a business activity with the Spatial Plan of a region. There are 3 types of KKPR depending on the location; Land, Sea, Forest.

• EP: Every business plan and/or business activity that has an impact on the environment must have environmental documents in the form of: SPPL/ AMDAL/RKL-RPL. The list of business plans/activities which are subject to Amdal, UKL-UPL and SPPL can be found in Regulation of the Minister of Environment and Forestry Number 4 Year 2021.

• PBG: For business actors that engage in the construction of buildings, altering, expanding, reducing and/or maintaining buildings in accordance with the technical standards of buildings, must have a Building Approval (PBG).

• SLF: SLF is a certificate which is granted by regional governments to declare the functional worthiness of a building before it can be utilized
  
  
   

In contrast to low and medium-low-risk business activities, for medium-high- and high-risk activities, the NIB and Standard Certificate that are obtained from the OSS system and have not been verified shall be valid as the legality of business actors to prepare for business activities. In order for a standard certificate to be verified and used as legality to conduct commercial operations, business actors must fulfill the standards through the OSS system, whose period is regulated through norms, standards, procedures, and criteria that are stipulated by ministries/non-ministerial government agencies.