Perseroan Terbatas (PT) or Limited Liability Company (LLC)
A PT is the equivalent of a limited liability company (LLC) and is the most common form of business entity in Indonesia. It offers limited liability protection to its shareholders and requires a minimum of two shareholders and one director. A PT can be either a local company (PT) or a foreign-owned company (PT PMA) depending on the ownership structure.
Kantor Perwakilan Perusahaan Asing (KPPA) or Representative Office (RO)
A Representative Office is a legal entity that allows foreign companies to have a presence in Indonesia without establishing a fully-fledged company. The primary purpose of an RO is to represent the interests of the parent company, conduct market research, promote products or services, and facilitate business activities on behalf of the parent company.
Perusahaan Perorangan (Sole Proprietorship)
This is the simplest and most straightforward form of business entity. It is owned and operated by a single individual who has unlimited liability for the company’s debts and obligations. Sole proprietorships are typically suitable for small businesses and are not considered legal entities separate from their owners.
Firma (Partnership)
A partnership is an association of two or more individuals or entities who agree to carry out a business together and share its profits and losses. There are several types of partnerships in Indonesia, including general partnerships (firma) and limited partnerships (CV). In a general partnership, all partners have unlimited liability, while in a limited partnership, there are both general partners with unlimited liability and limited partners with liability limited to their capital contributions.
Yayasan (Foundation)
A yayasan is a nonprofit organization established for charitable, religious, educational, or social purposes. It operates based on a constitution and is governed by a board of trustees. Yayasan must be registered with the Ministry of Law and Human Rights and fulfill certain requirements to obtain tax-exempt status.
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