Indonesia has regulations in place that facilitate the formation of a Limited Liability Company (LLC), also known as Perseroan Terbatas (PT). Interested parties must note that at least two shareholders and a director are mandatory to establish this form of company. At incorporation, the PT must have at least 25% of the authorized capital paid up. In terms of governance, the company’s operation is to be executed by a board of directors. It is necessary for the PT to convene an annual general meeting of shareholders, and the company must comply with rules requiring the submission of annual financial statements and reports to the Ministry of Law and Human Rights.
Another mandatory requirement includes having a registered office and obtaining a tax identification number. It is noteworthy that foreign investors enjoy the liberty of buying up to 100% of a PT’s shares. Such foreign investors are, however, subjected to certain restrictions or limitations, particularly for specific industries.
Finally, the process of company formation can take weeks and includes obtaining several essential documents, including a domicile letter, company deed, tax registration, and business license..