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On Why Representative Office is a Safe Form of Company Registration In Indonesia

December 7, 2017 No Comments

When it comes to Company Registration In Indonesia, there are three modes of business form you can assume so that the company can legally operate on Indonesian soil: a PT PMA, a local company, and a representative office.

The two former modes are reserved for anyone who has been sure about investing in the country. A representative office serves as a way for a foreigner to gauge the potentiality of investing in Indonesia. In a sense, your company will have an official branch in Indonesia, upon whom several major restrictions are imposed.

When you manage to get a Company Registration In Indonesiain the form of a representative office, the entity is legally forbidden from activities specific to making profits. Thus a representative office cannot cut any kind of business deals with Indonesians, either individuals or companies. Generating revenues solely under the name of the office is prohibited.

Importing, exporting, and domestic trading are strictly prohibited for the office. An office manager of foreign origin is allowed to apply for a work permit and foreign personnel are granted access into the country with multiple entry visas.

With limitations imposed on a representative office, you might be wondering why you should apply for this kind of Company Registration In Indonesia. Well, as mentioned at the beginning, a representative office is a great way to measure just how potential Indonesian market is.

It opens a door for you to explore opportunities present in the country. The areas of focus a representative office work around involve activities relating to market research. Marketing and promotion is allowed as long as conducted via agents of buying and selling. It is safe to assume that a representative office oftentimes transforms into a full-fledged PT PMA following a successful research and promotion, whereupon investors offer capital to establish a working company.

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