logo

Coming Soon

Corporate Matters

Home / Corporate Matters

Under Indonesian law there are many types of corporation which has their own characteristic especially related to the right and responsibility of the beneficial owner. Indonesian law recognize association, firm, Commanditaire Vennootschap (CV), cooperative, and limited liability company as corporation which may conduct business activities.

Limited Liability Company is the type of corporation the most commonly used for business as limited liability company separates the company’s liability from the shareholders’. There are three organs of limited liability company which are Board of Directors, Board of Commissioners and General Meeting of Shareholder. Each of the organ has its own right, responsibility, and authority.

The Board of Directors is the organ that are tasked to conduct daily activities of the Company in accordance to the best interest of the Company as provided in Article of Association.

The Board of Commissioners is the organ that are tasked with conducting general and / or specific supervision in accordance with the articles of association and providing advice to the Directors.

General Meeting of Shareholder is the organ where the shareholder may impact the Company’s activities. The organ has authority not given to the Board of Directors or the Board of Commissioners within the limits specified in the Company Law and / or articles of association.

Although in principle shareholders, directors, and commissioners do not bear the company’s obligations privately, but in certain cases they can be responsible for the company’s obligations.

Shareholders are personally responsible for the company’s obligations if:

  1. the requirements of the Company as a legal entity have not been fulfilled;
  2. the relevant shareholders, either directly or indirectly in bad faith, use the Company for personal interest;
  3. the relevant shareholders are involved in illegal acts conducted by the Company; or
  4. the relevant shareholders either directly or indirectly illegally use the Company’s assets, resulting in insufficient Company assets to pay off the Company’s debts.

While the directors and commissioners of the company are personally responsible for the loss suffered by the company if it does not carry out the management or supervision in good faith and prudence for the interests and in accordance with the aims and objectives of the Company.