Company establishment in Jakarta is essential to conduct business in Jakarta. With the promising economic performance of Indonesia, many business opportunities arise. As discussed in previous articles, one of the most lucrative industries is mining. Although the commodity price fluctuated from the end of last year to early this year, it quickly stabilizes and remains at a high value.
Aside from mining, other industries that work around mining also enjoy many benefits—for instance, shipping and logistics companies. With the high demand for mining commodities, there is also an increase in shipping and logistics demand. Thus, even with the oil price hike these companies can charge a higher fee and earn profits. Likewise, companies in heavy machinery also enjoy an increase in profit.
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For foreign companies to enjoy said benefits, they must have a company in Indonesia. For convenience and practical reasons, a company established in Jakarta is recommended. Entrepreneurs who do not have a legal entity in Indonesia must set up one before conducting their business. There are two types of foreign-owned companies available; Representative Company and PT PMA (foreign direct investment company).
Representative Company and PT PMA
A representative company is suitable for foreign companies that do not need to make monetary transactions in the country. For instance, if the company sells commercial goods and products, it will likely set up a local distribution channel. In that case, there will be no need for the foreign company to conduct monetary transactions. It suits the local regulation as representative offices are not allowed to do any transactions.
In general, representative offices are responsible for conducting marketing activities and supporting the distributors. On a side note, having distributors transact directly with the foreign company’s headquarters may be easier for the company’s accounting purposes.
Nonetheless, a PT PMA is preferable to foreign companies that need to conduct transactions directly with their customers. For example, if a foreign company is trading mining produces, they must engage with their local suppliers and buyers. Therefore, they must have the proper documentation and permission to do monetary transactions. Plus, they will less likely to focus on marketing activities because the heart of the business lies in the operations.
Company Establishment in Jakarta for Foreign Individuals
To ensure that foreign entrepreneurs can establish their companies in Indonesia, they need to get the proper assistance. Regardless of a representative company or a PT PMA, complete legal documentation is essential. Therefore, entrepreneurs are encouraged to find service providers who are experienced and reliable. Any misinformation or lack of document submissions may lead to missed business opportunities.
Entrepreneurs need to know that in Indonesia, the company establishment process falls under notary jurisdiction. Many foreign entrepreneurs mistakenly go to lawyers as it is the common practice in their home country. However, it is not the case in Indonesia where the system still adopts the Dutch legal system. Thus, companies must find a trusted notary to help with the process and advise.
Another thing to prepare is business domicile. It is part of the basic requirement of establishing a company in Indonesia. Without proper business address proof, the authorities will not approve the documents. To get these business address proof, entrepreneurs must acquire a domicile certificate. The most economical, practical, and a suitable solution would be to rent a virtual office or a serviced office.
To find out more about virtual offices, serviced offices, and company establishment, chat with our team on Whatsapp at +62812 1315 4189. MESO also provides company establishment and virtual office packages suitable for all companies.