How to Set Up Representative Office in Indonesia?
Corporate Secretary Service Indonesia – Indonesia frequently sticks out as a strategic option for many foreign businesses considering expansion into Southeast Asia. Few regional markets can match its advantages due to its large population, expanding economy, and advantageous location. There are a few key things you should know before beginning the process if your business intends to set up representative office in Indonesia.
Choosing the Right Type of Representative Office
Indonesia acknowledges a number of representative office types, each with distinct functions and permitted activities. In order to choose the one that best suits your objectives, it is essential to comprehend these differences.
Foreign Company Representative Office (KPPA)
With an exclusive focus on non-commercial activities, this is the most fundamental kind of representative office. Coordinating with affiliates, performing market research, overseeing operations, and getting ready for upcoming investment projects in Indonesia or other nations are all jobs that a KPPA can manage.
Representative Office of a Foreign Trading Company (KP3A)
A KP3A has a broader scope than a KPPA. In addition to promoting and marketing the foreign parent company’s products, it can also research market demands, sign export contracts on the parent company’s behalf, and advise local clients on importation and usage. In essence, it serves as a conduit for trade between Indonesia and the nation of origin.
Representative Office of a Foreign Construction Services Company (BUJKA)
Construction-related services, such as project planning, execution, and supervision, are the main focus of this office type.
Representative Office of Foreign Electricity Support Services (KPJPTLA)
Activities pertaining to the supply of electricity fall under this category, including testing, certification, training, and installation and maintenance.
Labor Compliance Considerations
If your representative office plans to hire foreign workers, you must also employ local staff to accompany them. A minimum number of local hires is even required by some licenses. This promotes knowledge sharing between international and local teams and guarantees adherence to Indonesia’s employment laws.
Preparing Your Documents
You must prepare a number of important documents that are legal in your home country before you can formally set up representative office in Indonesia. Usually, these consist of:
- The parent company’s deed of establishment
- A formal letter appointing the head of the representative office in Indonesia
- A signed statement from the appointed head
- A reference letter from the Indonesian Embassy or BKPM office abroad
- A statement of intent to open an office in Indonesia
Registration and Licensing
Once all documents are ready, the next step is registration through the OSS RBA system. You will receive a Business Identification Number (NIB) and any additional licenses needed for your kind of representative office through this process.
Opening a representative office is often the most efficient and low-risk way to enter Indonesia’s thriving market. By selecting the right office type, following labor laws, and meticulously preparing your documentation, you can position your business for long-term success. If your goal is to explore opportunities, build partnerships, and gather market intelligence before starting full-scale operations, set up representative office in Indonesia and starting to build your presence in one of Asia’s most promising economies may be the best course of action.
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