Q69. What are the procedures for establishing a representative office?

1. Procedure for establishing a representative office
   
   • Documents required by head office

The head office wishing to establish a representative office must prepare the documents below and obtain Apostille notarization from the Ministry of Justice or Ministry of Foreign Affairs and Trade of the home country.

• Headquarters Articles of Incorporation (English, Apostille notarization)
• Copy of register from head office (English, notarized by Apostille)
• Business license from head office (English, Apostille notarization)
• Letter of appointment for branch manager (English, notarized by Apostille)
• Memorandum from the branch manager
• Copy of branch manager's passport

• Branch Manager Resume (English)
• Branch manager’s final academic background certificate (English)
• Power of attorney for procedures

If you register the above documents in the Investment Office OSS online system, you will obtain the following licensing documents depending on the type of representative office.

1. General Representative Office (KPPA)
   
   • Taxpayer registration certificate (SKT / NPWP): Issued by the competent tax office
   • Business Registration Certificate (NIB): OSS issued

1. Construction Representative Office (BUJKA)
   
   • Taxpayer registration certificate (SKT / NPWP): Issued by the competent tax office
   • Business Registration Certificate (NIB): OSS issued
   • Sertificate Standard (Basic Certificate): Issuance of OSS Once the above construction representative office is established, it must register with the Construction Association and obtain the following certifications.
   • Types of Construction Association Certification Acquisition

• Registered as a construction association (KTA: Kartu Tanda Anggota)
• Construction License Fixed Business Permit (SBU: Sertifikat Badan Usaha)

In order to obtain the above construction association certificate, the following licensing documents from a local construction company partner are required.

1. List of local company licensing documents for obtaining a construction license
   
   • Articles of incorporation, amendments to the articles of incorporation, and Ministry of Justice approval of each article of incorporation (AKTE Pendirian, AKTE Perubahaan, SK Kehakiman)
   • Corporate tax registration certificate, VAT registration certificate (SKT NPWP, PKP BADAN)
   • Directors and auditors’ resident registration cards, personal tax registration cards, email addresses, and phone numbers (KTP Director, Komisaris, NPWP Pribadii, E-mail address, Nomor Telpon)
   • Construction industry permanent workplace permit, construction association registration certificate, college graduation certificate for new employees majoring in architecture and experienced employees

(SBU B1/B2, KTA (Member Identification Card), SKA (Skill Certificate)

• Business registration / construction license / location certificate (NIB, IUJK OSS, SKDP)
• Construction performance contract:

• Single project (over 84 billion Tupiah), cumulative construction performance over the past 10 years (over 250 billion Tupiah)
• Completion report
• expense statement
• Invoice/Tax Bill
  
  • Financial statements for the past two years (income statement, balance sheet)
  • Once the construction license of the representative office is completed based on the above document list of the corporate tax year-end tax return for the past two years, a JO can be established with a local construction company as a partner to carry out the project.

1. The JO establishment approval documents are as follows.
   
   • JO Articles of Incorporation (AKTE JO)
   • Income tax, VAT registration certificate (NPWP, SKT, PKP)

Q70. Can I establish branches in multiple regions of Indonesia? If possible, where should I register my place of work when issuing a visa?

Branches in Indonesia can be established in multiple regions, but one branch manager cannot manage branches in multiple regions. Basically, one head of a representative office is permitted to establish a branch after submitting a Letter of Intent to work only in one region, so he or she can only work in one office with a visa. Therefore, in order to operate branches in multiple regions, a separate branch must be established and a separate branch head must obtain a work visa to operate the branch.

Q71. Is there an activity report that the representative office must submit to the government on a regular basis? The representative office is obliged to report its activities regularly. The obligation to report activity status is stated in the representative office permit. General representative offices and trade offices

Representative offices must submit a representative office activity report called Laporan Kegiatan Kantor Perwakilan twice a year semi-annually. Reporting can be done through the Investment Office's online system. Regardless of the date of establishment, the reporting period must be reported in July for January-June work, and in January of the following year for July-December work. Since all government office work is done with the OSS system, government office work such as licensing work is progressing.

If this is not possible, you must report within the period specified above. To report, go to the OSS system at BKPM (Board of Investment Coordination), download the report form, fill it out, and register.

Q72. When establishing a representative office or branch, is there a company name stipulated by law? There is no legal regulation regarding the company name, but in order to receive permission from the Investment Office, the name of the head office must be written as is. However, you just need to write the letters RO in front of the business name. If you continue to establish a JO after establishing an RO, you can indicate this by adding JO in front of the business name, and attach the RO business name and the JO business name side by side in front of the office. RO and JO offices can use one address simultaneously.

Q73. I am curious about the procedures, costs, and time required to close a branch. In the case of a representative office, the process is completed when approval for closure is obtained from the approval agency, BKPM (Board of Investment), and the tax registration cancellation procedure is followed by the tax office. However, in the case of canceling a tax registration certificate, a tax audit by the tax office must be conducted first, so it takes about a year to complete the cancellation process. However, in the case of a representative office, since there is no ordinary profit or loss from sales, a tax audit may not occur, so it is recommended to withdraw after applying for tax registration cancellation (Pencabutan NPWP) and leave follow-up management to a professional company to save costs. It is efficient.

Q74. Can I convert to a corporation after advancing into a representative office?

Representative offices and corporations require different types of licenses. Conversion from a representative office to a corporation is not possible. Representative offices must be closed or maintained depending on their function and purpose, and corporations must be established separately. In the case of construction corporations, recently changed regulations allow for the establishment of a new construction corporation based on construction experience and performance through a construction industry representative office (BUJKA). It is impossible to establish a construction business corporation from scratch. Must have experience and track record as a construction industry liaison office. After establishing a foreign construction business corporation based on the performance of the representative office, you can close the business if the representative office is no longer needed.

※ In Indonesia, the expression “branch” is not used and the correct expression is “representative office.” However, from a Korean perspective, it is often referred to as a branch office for convenience, but in reality, it is a representative office.