Establishing a company in Indonesia, particularly a PT PMA, is an exciting endeavour filled with endless possibilities. One of the crucial steps in this process is selecting a name for your company that not only represents your business activities but also adheres to the legal requirements set forth by Indonesian authorities.
The task of choosing the perfect name for your PT PMA may seem simple at first glance, but it involves careful consideration and a thorough understanding of the Indonesian business landscape.
Types of Companies in Indonesia
As one of the most strategic business destination countries in Southeast Asia, Indonesia provides various types of business in Indonesia that can be established depending on the needs and considerations. The most common types include PT (Perseroan Terbatas), PMA (Penanaman Modal Asing), and Representative Office (KPPA).
PT stands for Perseroan Terbatas, which is the Indonesian term for a limited liability company. It is the most common form of business entity in Indonesia and can be owned by Indonesian nationals or foreign individuals/entities.
PT PMA stands for Perseroan Terbatas Penanaman Modal Asing, which translates to a foreign-owned company. It is a specific type of PT that is established by foreign investors to conduct business activities in Indonesia. PT PMAs are subject to additional regulations and requirements compared to regular PTs.
Representative office (KPPA) stands for Kantor Perwakilan Perusahaan Asing, which means Representative Office of a foreign company in Indonesia. It refers to a type of foreign-owned company representation in Indonesia. A KPPA is not considered a separate legal entity but rather an extension of the parent company, and its activities are limited to certain non-commercial functions such as market research, promotion, and liaison activities.
Requirements for PMA Company Incorporation
Setting up Indonesia companies should fulfil the requirements below:
- Company Name Filing
- Deed of Establishment
- Registration of Taxpayer Identification Number (NPWP)
- Domicile Letter
- Business Identification Number (NIB)
- Other Licenses Registration
In this article, we will run you through the right steps to propose an Indonesian Company Name.
What is a PT company name in Indonesia?
A PT or local company name refers to the proposed company name of a legal entity in Indonesia. A PT is a limited liability company and the most common form of business entity in Indonesia. The company name for a PT is a unique identifier that distinguishes it from other companies and reflects its brand identity.
How to Select Company Name
Choosing a name for PT / PT PMA in Indonesia would require considering several factors. The name should be easy to memorise, distinctive from any other existing company names and should align with the core value of the business. The company name must not transgress the existing trademarks, as it should first go through an assessment to avoid restrictions imposed by the Indonesian government.
Conducting complete research for your PT company is highly recommended to make sure that you aren’t adopting a name that has already been taken by someone else. Doing this could save you from potential issues further down the line. Consulting business advisors or legal specialists can be a smart move when you are making decisions surrounding your business name selection and registration.
Choosing a company name in Indonesia is critical for the formalisation process. It is required to get affirmation from the Ministry of Law and Human Rights to utilise the foreign investment company chosen name. This step takes place at the launch of the company’s enrollment undertaking.
The name has to include at least three words
One of the most essential requirements when coming up with a company name in Indonesia is to make sure the local name includes at least three words in the name. This is a regulation issued by the Ministry of Law and Human Rights.
For example, if your company name is Innovation Service, then you would need at least one more word to complete the name and has to align with the business’s core value. If the business runs a technology production, then the name would change to PT Technology Innovation Service.
Also, note that every company in Indonesia should have the abbreviation “PT” preceding their name. You can as well check the availability of the name.
Using a different brand name
You don’t have to use the same brand name for your PT PMA no matter which country you decide to expand into. For instance, if you want to do business in Indonesia and your logo is currently crafted of two words, then you can use a variation containing those two words in the country.
To reserve your brand solely in Indonesia, trademark registration has to be completed independently of the main global organisation, if it has been already registered worldwide.
The name cannot be similar to an existing company or government institution
When choosing a name for your PT PMA in Indonesia, make sure it is not similar to the names of:
- Any existing businesses in the country
- Organisations at the international level
- Government establishments
If you are an international corporation looking to form a representative office in Indonesia, you may use the same name. To show that you are a company representative, you would need a letter from your headquarters.
Otherwise, avoid choosing names that are identical to, or simply sound similar to, the names of other corporations or organisations.
Don’t use vulgar or obscene words
It is essential to steer clear of slant terms and language which can be seen as insolent, improper, or blasphemous when choosing the name for a PT PMA. As this is one of the most cultural-driven nations, those words should be avoided.
Do not utilise a series of numbers and use the Roman alphabet only
As the Roman alphabet is the most commonly used alphabetical system in the world and Indonesian PT PMA names have to be clear and understandable to all, it is mandatory to choose a name which only includes the Roman alphabet.
Another restriction when choosing a corporate name is that you are not allowed to use any letter or number combinations that do not form a word.
How to Change Company Name in Indonesia
Changing the name of your PT PMA is not possible, nonetheless. Should you decide to change your company name in the future, you should as well consider that you will have to generate new tax cards and Business Identity. This also means that you need to get re-approvals from the following authorities:
- The local tax office
- BKPM
- Ministry of Law and Human Rights as well
Therefore, consider all the length of paperwork and additional expenses before consider to rename your company.
Alternatives to Obtain a Foreign Ownership Company
On the other hand, KPPA, also known as a Representative Office of Foreign Company, can also work as an entity or a business vehicle for conducting business activities in Indonesia. A KPPA serves as a liaison office for a company with foreign direct investment to undertake non-commercial functions such as market research, promotion, and coordination with local partners or customers. It is limited in its activities and does not engage in direct revenue-generating operations.
Found this article helpful? Then check out our useful guides below by clicking the links:
Company Establishment in Indonesia – Your questions answered
Registering a Trademark in Indonesia – How to protect your business
Business Establishment – The Process and Requirements
How to Establish a PT PMA in Indonesia: 5 Tips to Own A Foreign-owned Company At Ease
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