Background

To improve the transparency, effectiveness, accountability, and administrative order of legal services for limited liability companies in Indonesia, the Ministry of Law recognized the need to modernize and optimize corporate legal administration. The previous regulation governing the procedures for the establishment, amendment, and dissolution of limited liability companies was no longer aligned with current legal developments and digital service requirements. Therefore, this new regulation was issued to ensure more accessible, efficient, and technologically integrated services for business entities operating under Indonesian law.

Types of Limited Liability Companies in Indonesia

Under this regulation, Limited Liability Companies (Perseroan Terbatas) in Indonesia consist of two forms:

  • Capital-Based Company (Perseroan Persekutuan Modal): a legal entity established based on an agreement by two or more parties, conducting business activities with capital divided into shares.
  • Sole-Shareholder Company (Perseroan Perorangan): a legal entity established by a single individual that qualifies as a Micro or Small Enterprise in accordance with relevant regulations.

Establishment Process

The establishment of a capital-based company:

  • must be carried out through a notary; and
  • submitted electronically via the SABH system.

The application must include supporting documents such as:

  • the notarized deed of establishment,
  • proof of capital payment,
  • company address, and
  • Beneficial Ownership information.

Once the application is complete and submitted, the Minister—through the Director General—issues the approval of legal entity status electronically, which the notary can then print independently.

Reportable Amendments

Any amendment to a company’s Articles of Association or corporate data must be reported to the Minister through the Sistem Administrasi Badan Hukum (SABH system).

Certain amendments to the Articles of Association require prior approval from the Minister, including changes to the:

  • company name,
  • domicile,
  • business activities,
  • duration,
  • authorized capital,
  • capital reduction, and
  • changes in status between private and public companies. Other amendments—such as changes in shareholding structure, board composition, address, or dissolution,

must be notified to the Minister for recording. All amendments must be notarized and submitted within 30 days from the date of the resolution.

Registration of Amendments

The registration of amendments to the Articles of Association or company data must be submitted electronically through the SABH system by a notary.

The application must include the amendment deed and other supporting documents, such as the minutes of the shareholders’ resolution, proof of capital changes, corporate address confirmation, relevant approvals from technical agencies, and Beneficial Ownership documents.

The notary is required to confirm the completeness and legal accuracy of the submitted documents. Once verified, the Minister issues an approval letter or receipt of notification electronically, which the notary can print independently.

Transparency & Beneficial Ownership

The regulation emphasizes stronger corporate transparency by requiring companies to identify and report their Beneficial Owners — individuals who ultimately control, receive benefits from, or are the true owners of the company’s shares or assets. 

Supporting documents must be submitted, including a statement from the directors naming the Beneficial Owner, proof of consent from the Beneficial Owner, and a power of attorney authorizing the notary to provide this information through the SABH system. This requirement aims to prevent corporate misuse, enhance accountability, and align with anti–money laundering and counter-terrorism financing standards.

Service Efficiency & Digitalization

The regulation strengthens digital governance by requiring that all processes related to the establishment, amendment, and dissolution of limited liability companies be conducted electronically through the SABH system. This digital approach ensures faster processing, easier access for businesses, improved administrative order, and enhanced transparency. In certain exceptional circumstances—such as system disruptions or limited internet access—applications may temporarily be submitted non-electronically, as determined by the authorities.

Disclaimer

The information contained in this article is provided for general informational purposes only and does not constitute legal advice or a formal legal opinion. The interpretation and application of any law or regulation should be carried out exclusively by qualified legal professionals who can assess the specific facts and circumstances of each case. We do not assume any responsibility or liability for any actions taken based on the content of this article, nor do we guarantee that the outcomes of any application of the discussed legal provisions will align with readers’ expectations. Laws and regulations may evolve over time, and updates or changes may occur without prior notice. Readers are strongly encouraged to verify the current status of any legal provisions and seek professional guidance before making decisions or taking action.

Link for download the Regulation: https://drive.google.com/file/d/172oh5rk9jp4dikVq8GyHknNUnFSk33Mk/view?usp=drive_link