Company Law

Bagus SD Nur Buwono

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Company Law Syllabi

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Reference
For order, please contact:
Ina (081319249139)
@Rp.160,000

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Definitions
⦁ A company (Perusahaan) is any form of business that runs
every type of business that is permanent and continuous and
who are established, working, and domiciled in the territory of the
Republic of Indonesia for the purpose of obtaining profit.

⦁ An entrepreneur (Pengusaha) is every individual or association

or legal entity that runs any kind of company.

⦁ Business (Usaha) is any action, action, or activity in the

economic sector that every entrepreneur conducts for the
purpose of gaining profit.

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• Law No. 8 of 1997 regarding Company Documents (Law No.
8/1997), which defines the company as
"any form of business which carry out activities regularly
and continuously with the aim of obtaining benefits or
profits, both organized by individual persons and
incorporated or unincorporated business entities, and which
is established and domiciled in the territory of the State of
the Republic of Indonesia."

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Indonesia law Types of Business Structures

Unincorporated Incorporated
(Bodies Corporate)
Non- Legal Entity
Legal Entity

Maatschap Limited Liability Company

Sole Proprietorship
(Perseroan Terbatas /PT)
The simplest form of business cooperation among
Single businessman businessmen Deed of Establishment is considered as an agreement, so it needs at least
two founders to sign.
No certain to matter required Subject to the fulfilment of formality requirements, i.e., notarial deed of
Particular
General Maatschap establishment and approval from the Ministry of Law and Human Rights
Maatschap

Maatschap  Partnership
Private PT Public PT Publicly Listed PT
Established by contractual
Authentic deeds and registration may be required, Partnership
but in the absence of such conditions, does not affect
the legality of their existence PT with sole
Subject to certain conditions
shareholder

General Partnership/Firm (Firma) Limited Partnership (Commanditaire Venootschap/CV)

Established under a joint name ‘Active partner’ (sekutu komplementer) & ‘Silent partner’ (sekutu komanditer)

Open CV Silent CV Share-based CV

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English law

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Relevant laws and regulations:

Business Organization Governing Provisions of Law

Maatschap  Art 1618 – 1652 of the Civil Code

General Partnership  Art 15 of the Commercial Code on the application of Art

(Firma) 1618 – 1652 of the Civil Code
Limited Partnership  Art 16-35 of the Commercial Code
(Commanditaire
Venootschap/CV)
Limited Liability Company  Historically, it was regulated under the Commercial Code
(Perseroan Terbatas/PT) before the enactment of Law No. 1/1995
 Law No. 40/ 2007 as amended by Law No. 11/2020

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Definitions:
Sole  The simplest form of enterprise
Proprietorship  'sole entrepreneurship,' 'individual entrepreneurship,' 'sole trader'.
 A small company, which is personally run by the entrepreneur or by employing only his own closest
family members.
 The sole proprietorship carries out activities or obtains profits or profits only to fulfill daily living needs.
 The closest family member employed in the business is the family in a relationship up to the third degree,
either a straight line or a sideline, including son-in-laws and brother-in-laws.
 For examples, a trading company (Usaha Dagang/UD.
Maatschap  An agreement where two or more persons bind themselves to contribute something into a partnership,
eventually to divide the obtained profits of the partnership.
 For this purpose, each partner must put money or other goods in the Maatschap.
 Maatschap is unknown in the U.K. and U.S. systems.

General  Firma, also known as Fa or Venootschap onder Firma (VoF) in Dutch.

Partnership  It is a Maatschap, which is established to operate a company under a joint name.
(Firma)  A partnership that runs a business continuously, and each of its partners has the right to act on behalf of
the Firma.

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Definitions:
Limited Partnership  It is a derivative of a Dutch-originated company called Commanditaire Venootschap/CV, and mentioned
(Commanditaire differently all across the globe.
Venootschap/CV)  Article 19 of the Commercial Code provides that: “A partnership formed by extending money, or also
referred to as a Limited Partnership, is established by a single or by several partners responsible with all
their private assets, with one or more persons as lenders”.
 Partnership established by one or more limited partners with one or more complementary partners to run a
business continuously. CV is a form of Firma, which consists of two kinds of partners, namely:
(a) ‘active partner’ (sekutu komplementer or working/management partner) Partner, who is, in addition
to investing capital into the CV, also in charge to operate and manage the company and is authorized
to enter into an agreement with a third party for and on behalf of the CV; and
(b) ‘silent partner’ (komanditer or passive/no-work partner), who is only investing capital into the
company without meddling in the company's management and operations.

Limited Liability Company  Law No. 11/2020: “a legal entity which is an association of capital established based on an agreement
(Perseroan Terbatas/PT) carries out business activities with authorized capital which is entirely divided into shares or Individual Legal
Entities that meet the criteria for Micro and Small Enterprises as stipulated in the statutory regulation
concerning Micro and Small Enterprises.”
 Law No. 40/2007: “a legal entity, which is an association of capital, established based on an agreement,
carries out business activities with authorized capital wholly divided into shares and fulfills the requirements
stipulated in this Law and its implementing regulations.”

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Legal entity:
• It has judicial independence regardless of the person within the company
(persona standi in judicio).

• Schilfgaarde also affirms that "rechtspersoon betekent drager van rechten en

plichten" or legal entity is the subject of law.

• Salomon v. Salomon & Co. Ltd (1897)

• 'Fictitious Theory' (also known as 'Entity Theory', 'Aggregate Theory', 'Fiat

Theory', 'Consensus Theory'), 'Organ Theory', 'Contract Theory', 'Realistic
Theory', 'Juridical Reality Theory’.

• The fundamental differences between the form of a legal entity and non-legal
entity: limited liability, centralized management, continuity of life, transferability of
interest.

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