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  • Know Your Beneficial Owner Principle Implemented in Indonesia

    Know Your Beneficial Owner Principle Implemented in Indonesia

    Further to our previous column, to prevent and eradicate the crime of money laundering and terrorism financing, the government has issued Presidential Regulation Number 13 of 2018 on the Implementation of Know Your Beneficial Owner Principle By Corporations to Prevent and Eradicate Money Laundering and Financing of Terrorism (Regulation 13/2018). In Regulation 13/2018, every corporation is required to define the beneficial owner in a corporation.

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  • Change of Status of PT Allows Termination of Employment

    Change of Status of PT Allows Termination of Employment

    Article 163 paragraph (1) Law number 13 of 2003 on Manpower (Labor Law), states “The employer may terminate the employment of his or her employees in the event of change in the status of the company[…]”. The Labor Law does not clearly specify what is considered a “change of status” of a PT or PT PMA. In this column we further discuss the change of status of companies in Indonesia, to clarify which events justify termination of employees based on the above article 163(1) of the Labor Law.

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  • Notary Fees for Limited Liability Company Establishment Regulated

    Notary Fees for Limited Liability Company Establishment Regulated

    Recently, the Ministry of Law and Human Rights (Ministry) issued regulation number 3 of 2017 on the Notary Fees for the Establishment of a Limited Liability Company for Micro, Small and Medium Sized Enterprises (New Regulation). The New Regulation is an implementation of the 12th economic policy package of the Indonesian Government. This economic policy package is an effort of the Indonesian Government to reduce business costs and improve the business climate for investors.

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  • Shareholder Liability against Consumer Claims in Indonesia

    Shareholder Liability against Consumer Claims in Indonesia

    The customer protection in Indonesia is regulated in law number 8 of 1999 on Consumers' Protection (Consumer Law). The Consumer Law gives consumers the right to sue PT Companies for any damage incurred due to the use of certain goods or services. In this column we discuss the shareholder liability in case of such consumer claim. We compare the Consumer Law with the Law number 40 of 2007 on Limited Liability Company (Company Law), to gain understanding about the risk and liability of shareholders in such claims.

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  • Annual Work Plan and Annual Report Obligation of PT Companies

    Annual Work Plan and Annual Report Obligation of PT Companies

    Chapter 4 of the Indonesian company law no. 40 of 2007 on Limited Liability Companies (Company Law) regulates the obligations regarding the Annual Work Plan and the Annual Report for PT companies. The board of directors of the company must prepare the Annual Work Plan prior to the commencement of the next financial year. Such Annual Report must be submitted by the Board of Directors to the General Meeting of Shareholders (GMS) not later than six months after the financial year ends. In this column we discuss in more detail the procedure and contents of the Annual Work Plan and Annual Report.

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  • Company Registration and Company Amendments Procedures Redefined

    Company Registration and Company Amendments Procedures Redefined

    Ministry of Law and Human Rights (Minister) Regulation number 4 of 2014 regarding Application Procedures for Approval of Legal Entity and Approval and Notification of Amendment  of the Articles Of Association and Company Data of a Limited Liability Company (Minister Regulation), has recently been amended by Ministry Regulation number 1 of 2016 (Amendment). The Amendment changes the requirements related to the submission of the following applications to the Minister: i) legal entity ratification during company registration; and ii) notifications related to the amendment of the articles of association of a company and iii) amendments to the company data.

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  • Share Capital Requirements Amendment for Small Companies Indonesia

    Share Capital Requirements Amendment for Small Companies Indonesia

    The share capital requirement is regulated in article 32 of Indonesian law number 40 of 2007 regarding Limited Liability Company (Company Law). Paragraph 3 of the same article regulates that changes in the minimum amount of authorized capital as set out in paragraph (1) shall be stipulated by Government Regulations. As implementation of the paragraph 3, recently Government Regulation 7 of 2016 regarding Amendments in Authorized Capital of a Limited Liability Company (Government Regulation) was issued. In this column we discuss the implications of the new Government Regulation.

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  • Shares and Capital in a Limited Liability Company in Indonesia

    Shares and Capital in a Limited Liability Company in Indonesia

    The general provisions regarding shares in an Indonesian limited liability company (PT for local companies and PT PMA for foreign companies in Indonesia) are regulated in Indonesian Law number 40 of 2007 concerning Limited Liability Companies (Company Law). The Company Law regulates the minimum authorized capital and paid-up capital, and stipulates procedural rules related to the purchase, ownership and sales of shares.  In this column we discuss the general rules governing shares of a limited liability company in Indonesia.

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  • Company Register for Foreign Companies (PMA) Indonesia

    Company Register for Foreign Companies (PMA) Indonesia

    A company register for limited liability companies (which include foreign companies in the form of PMA) contains specific information about the company. The company register is open for public and therefore can be consulted by third parties in order to obtain general information about a company. Both local (PT) and foreign companies (PMA) are required to submit to and update company data of the Company Register which is maintained by the Minister of Law and Human Rights (Minister) or a designated officer.

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