Changing your business strategy, economic challenges, or personal circumstances can lead you to the decision of closing your business in Indonesia. Once again, foreign entrepreneurs have to navigate the intricate task of understanding Indonesian legislation. However, with proper planning and following certain steps, this process can become smoother and less stressful. In this article, we will explore the key steps required for closing a PT PMA in Indonesia.
Please note that when deciding to close a company, the director must be present in the location where the company was registered. If your company is in Bali, that means you need to be in Bali.
1. Prepare the documentation and issue a resolution for closing the company
The first step in closing a business with a PT PMA license is preparing the necessary documents. You will need the following:
- A resolution from the shareholders to close the company.
- A signed and approved financial report of the company at the time of closure.
- A resolution appointing a liquidator.
- An audit firm’s report on the financial state of the company.
2. Announce the Closure in a Local Newspaper
You must announce a company closure in a local newspaper. For example, if your business was in Bali, you can place the announcement in “Bali Post.” The closure will be issued 60 days after the announcement in the newspaper.
3. Appoint a liquidator
According to Indonesian legislation, a PT PMA company must appoint a liquidator who will be responsible for all the closure procedures. The liquidator can be a foreigner or a local resident, but it is essential that they possess the necessary knowledge and experience.
4. Settle financial and tax obligations
Before closing the company, ensure that all financial obligations, including tax payments, penalties, and debts to creditors, are settled. This is crucial to avoid legal problems in the future.
5. Initiate the liquidation process
The liquidator is responsible for formally concluding all of the company’s business operations. They must inform the Indonesian tax office and other official bodies of the company’s intention to close.
6. Cancel licenses and permits
You need to contact the relevant authorities to cancel all licenses and permits that your company may have had, including work permits and foreign employees’ stay permits. This process involves revoking the tax identification number (NPWP) and filing an NIB (Business Identification Number) withdrawal application.
7. Close bank accounts
Close all company bank accounts after the liquidation process is completed. Ensure that all company assets are distributed correctly among the shareholders as per the shareholders’ resolution.
8. Complete legal and court proceedings
The liquidator must also confirm that there are no pending legal or court cases related to the company and that all obligations to the courts or legal authorities are settled.
9. Notify the closure
After completing all the above steps, the liquidator must submit a closure notice to Indonesian authorities and obtain official confirmation of the company’s closure.
10. Closing PT PMA
Once you have received official permission to close the company, the liquidator finalizes the closure process, and the PT PMA company is officially considered closed.
Closing a PT PMA company can be a complex and time-consuming process, so it’s essential for company owners to seek legal advice and assistance from professionals familiar with Indonesian legislation.
Feel free to contact us if you plan to close your company in Indonesia. Legal Indonesia’s specialists will guide you on how to do it correctly without legal repercussions in the future.