Who's Legally Represents The Company In Indonesia?

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By:

Team of Hukumindo

Previously, the Hukumindo.com platform has talk about "What Types of Land Ownership May Company Obtain In Indonesia?" you may read also "Principles of Buying Land in Indonesia", and on this occasion we will discuss about Who's Legally Represents The Company In Indonesia?

We assume that when you make the choice to start a business in Indonesia, you understand which sectors are open or closed for foreign investment. In this article, we also assumed that you as a foreign investor have established a company in Indonesia. And to run a company, of course you need sufficient knowledge of corporate law in Indonesia. Or at least, on this precious occasion we will increase lightly your knowledge about company law in Indonesia.

Governing Law

The main sources of law governing limited liability companies in Indonesia are Law Number: 40 of 2007 Concerning Limited Liability Company. In addition, other laws are also regulated, including Law Number: 3 of 1982 concerning Compulsory Company Registration and Law Number: 11 of 2020 concerning Job Creation. Also, various implementing regulations under it.

The Company Organs In Indonesia

To answer the questions referred to in the article, we must first understand the company's organs first. There are three organs in a company, the first is the general meeting of shareholders, second is the board of directors, and the last is the board of commissioner. 

What is the General Meeting of Shareholders? As stipulated in Article 1 point 4, what is meant by General Meeting of Shareholders is the Company's Organ which has authority not given to the Board of Directors or the Board of Commissioners within the limits specified in this law and/or the articles of association.

What is a the Board of Director? As stipulated in Article 1 point 5, what is meant by the board of director is a company organ that is authorized and fully responsible for the management of the Company for the benefit of the Company, in accordance with the purposes and objectives of the Company and represents the Company, both inside and outside the court in accordance with the provisions of the articles of association.

What is a the Board of Commissioner? As stipulated in Article 1 point 6, what is meant by the board of commissioner is the Company's organ in charge of conducting general and/or specific supervision in accordance with the articles of association and providing advice to the Board of Directors. 

Who's Legally Represents The Company In Indonesia?

Then, who's legally represents the company in Indonesia? To answer this question, we must still refer to Law Number: 40 of 2007 Concerning Limited Liability Company, especially Article 1 point 5, where the board of directors is the one who legally represents the company in Indonesia, both inside and outside the court.

And as a tips, in the practice of corporate law in Indonesia, there are also rules that allow the board of directors to delegate their authority to one or several company employees for certain purposes. This provision refers to article 103, Law Number: 40 of 2007 Concerning Limited Liability Company. And if you have any issue with this topic, contact us, feel free in 24 hours, we will be glad to help you.

*) For further information please contact:

Mahmud Kusuma Advocate

Law Office

Jakarta - Indonesia.

E-mail: mahmudkusuma22@gmail.com

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Reference:

1. Law Number: 40 of 2007 Concerning Limited Liability Company.