Step-by-Step Guide to Register a Business in Indonesia

Here’s everything you need to register a business in Indonesia.

Business registration might seem complicated, but it’s easy to get a handle on things if you understand the regulations and have qualified assistance. We can categorize the process to register a business in Indonesia into three main steps:

  • Getting your Deed of Establishment (Akta Perusahaan),
  • Your company tax ID (Nomor Pokok Wajib Pajak or NPWP), and
  • Your Business Registration Number.

This process is similar for both local (PT PMDN) and foreign (PT PMA) companies, even though the requirements are different. Here’s what you’ll need to do to register a business in Indonesia.

Step 1: Getting a Deed of Establishment

Proposing a company name

First, Indonesian regulations state that official company names should consist of at least three different words. Keep in mind that this official company name is only for legal purposes so that you can have another distinct name for your brand or product.

Drafting Articles of Association

Once you’ve picked a company name, you need to find a registered notary to write the articles of association for your company. According to Indonesian law, this document will consist of:

  • Your company’s name and location,
  • Your company’s objective and business activity,
  • Details about your amount of capital,
  • The amount and value of your company shares,
  • The titles, amount of members, appointment and discharge procedures of your Board of Directors and Commissioners,
  • Methods and locations to hold your shareholder meetings, and
  • Procedures for using and distributing your company’s profit and dividends.

Submitting your Deed of Establishment

Next, you need to sign the Article of Association. All your shareholders need to sign the document in the presence of the notary. If a shareholder can’t attend, they’ll have to use a power of attorney.

Then, your notary will submit the Articles of Association to the Indonesian Ministry of Justice and Human Rights for approval. The Ministry will then issue your Deed of Establishment; this signifies that the government has registered your business as a legal entity.

You’ll need these two documents – your Article of Association and Deed of Establishment – to apply for other licenses and a business registration number.

Step 2: Getting a company tax ID

After you get your Deed of Establishment, you will need to apply for the company tax ID at a local tax office. The government will send your original tax ID directly to your company’s address.

Previously, after you get your tax ID, you also had to get a domicile letter from the regional government. However, the local government in Jakarta released a new regulation in May 2019 that made domicile letters unnecessary for new companies in this city.

Step 3: Getting a Business Registration Number

In 2018, the Indonesia government launched the Online Single Submission system that makes the remaining steps of company registration more simple. By using the system, you can obtain the remaining documents – including your business registration number – all at once. These documents include:

  • Your import license (previously API-U),
  • Customs Identification Number (previously NIK),
  • Your business registry number (previously TDP), and
  • Automatically registers your company with the government’s Health and Social Security System (BPJS Kesehatan and BPJS Ketenagakerjaan).

Additional licenses

Generally, trading and service companies will be able to start doing business right away after this. However, some industries, like manufacturing and healthcare, need additional licenses before they can operate. Because business activities in Indonesia can vary widely, you should probably consult an experienced professional to discuss what you need here.

So, how do I start?

The registration process has gotten a lot more accessible. However, it can still be overwhelming for people who aren’t familiar with the system; not to mention the lack of ground support. It’s essential to know the basics of every step; however, consulting with a professional to help guide the process is still the better way to do.

Want to expand your business to Indonesia?

Greenhouse can connect you to pre-screened service providers to help incorporate your company in Southeast Asian countries. Learn more about our solutions.

If you plan to start a company in Indonesia we can connect you to on-site service providers or help match you with the right service provider for your needs.