Indonesia

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DOING BUSINESS

 


Local business incentives - Legal forms of companies - Registration and licensing procedures - Legal framework - Foreign exchange control - Regulations concerning equity investment - FDI inflows - Expertise of the political risk

Local business incentives

The government offers a certain number of advantages to foreign investors within the framework of their setting up in Indonesia. The Board of Investment of indonesia is a governmental agency, which provides exhaustive support regardind investment promotion matters. Particularly, it describes all incentives available for foreign investors.

 

Legal forms of companies

Form Number of partners/shareholders Minimum and/or maximum capital Liability Registration fee Release of financial documents
Persuan Terbata is a Private Limited Company. Minimum 2 shareholders. Minimum USD 250,000. Liability is limited to the amount contributed. About 0.5 % of the capital plus status registration fees.
Public Limited Company (PLC) Minimum 2 shareholders. Minimum USD 250,000. Liability is limited to the amount contributed. About 0.5 % of the capital plus status registration fees.


Legal framework
The law on foreign investments was changed by the law n°20 of May 1994.

Foreign exchange control
There is no currency exchange control. The Indonesian rupee is freely convertible. The investor does not need any authorization to repatriate dividends after distribution and payment of taxes.

Regulations concerning equity investment
A majority holding interest in stock of capital of an Indonesian company is legal, except in certain activity sectors.  


Foreign Direct Investment inflows in Indonesia

FDI inflows 2003 2004 2005 World rank (*)
2005
FDI inflows (USD million) 597 1896 5 260 112/141
Source : UNCTAD - World Investment Report
Note : (*) World Rank = UNCTAD Inward FDI Performance Index. It is a measure of the extend to which a host country receives inward FDI relative to its economic size. It is calculated as a ratio of the country's share in global FDI inflows to its share in global GDP.

 

Last modified in 2006 - ongoing update
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