Employer Of Record: How To Hire Indonesian Remotely
An Employer of record is an easy way to hire Indonesians without setting up a company in Indonesia. Indonesia has a large educated workforce, which can be beneficial for overseas companies. EOR in Indonesia allows companies to have Indonesian employees working remotely while paying benefits to the employees. Why to use Employer of Record in Indonesia Benefit for the company A foreign company may decide to use EOR for several reasons. The first reason is to avoid having to set up an entity in Indonesia, especially if the clients are not in Indonesia and the company doesn’t need to have a physical office or presence. The second main reason is to prepare an establishment in Indonesia and test the market with some employees without the burden of having to close the company if the business doesn’t work. Benefit for the employee Since COVID-19, a large number of employees have preferred to work remotely but do not get any social benefits such as retirement pension contributions or social security contributions. With the employer of record (EOR), employees get the benefit for themselves and their families. Employers pay the employee’s contribution without having to set up an entity in Jakarta or the rest of Indonesia. Get professional legal advice for Indonesia Indonesia’s legal system is complicated, with its many regulations, licences, and special rules for foreigners. Don’t make the mistake of trying to navigate it alone, and get the help of experienced consultants instead. At ILA, we can help you with intellectual property, corporate law, drafting, reviewing and managing legal documents, navigating commercial transactions and much more. You’re not alone. Reach out today to schedule a free consultation or read more about our legal service. How does EOR work? EOR is simple. The foreign company hires an Employer of Record (EOR) in Indonesia. This EOR company hires the employees on behalf of the employer (the foreign company). The EOR company in Indonesia pays the social security and pension contributions and handles the administrative work on behalf of the employer. The EOR has a working contract with the Indonesian employee while having a service-level agreement with the employer. The real employer is a foreign company, and the EOR does not handle any business relationship with the employee except the human resources and salary part. Cost of the EOR The EOR invoices the employer a percentage of the employee’s salary. There is usually a minimal amount. The employer transfers to the employer of record the following: Salary of the employee Pension contributions Social security contributions EOR company fee The EOR also invoices a deposit at the beginning of the contract in order to pay the employee in case the employer is not paying the employer of record and to have time to break the contract with the employee. In Indonesia, the cost of EOR ranges from 3% to 10% of the salary with a minimum invoice of around 50 USD (higher cost is probably not justified). ILA can assist you in deciding which solution is best for you, namely, establishing an entity and using an EOR. ILA can assist you either in the Philippines or Indonesia. Also read: All You Need to Know About Working Contract in Indonesia
Land Ownership And Land Title Transfer In Bali And Lombok
When it comes to acquiring rights on land in Bali and Lombok, it can be confusing to define which rights and obligations a foreigner gets. While in Bali, most of the transactions are on a lease (Hak Sewa), Lombok’s transactions are on a freehold property (HGB). The article below describes the different types of land ownership in Bali and Lombok. Land Titles in Bali and Lombok Bali and Lombok are part of Indonesia and follow the rules of Indonesia regarding the transfer of ownership. It is important to remember that having a lease doesn’t allow the foreigner to own a house, and taxation in their country of residence might be highly impacted. HGU HGU (Hak Guna Usaha) is a right granted to individuals or legal entities. The title can be translated as Business Use Rights for agriculture, plantations, livestock, fisheries, forestry, etc. It gives the right to have a business on the land. This right is typically granted for a set period of up to 35 years and renewed for another 20 years. There are specific conditions that ensure that the land is used productively and in line with the designated purpose. Local entities such as PMA and Indonesian individuals have the right to use the land, but full land ownership in Bali stays with the state. The owner of the HGU (Hak Guna Usaha) has obligations to meet certain requirements and respect the environment. The duration is stipulated in the contract, and the extension can be done at least 2 years before the expiration. The entity can request to transform the HGBU into an HGB under certain conditions. All the terms are regulated in the Basic Agrarian Law Number 5 of 1960 and Government Regulation Number 18 of 2021. HGB The HGB is a right to build on a land under the name of the entity owning the HGB. The Undang Undang gives rights to build and own buildings on land that initially doesn’t belong to the entity having the HGB. The terms of the HGB are initially for 30 years and are extendable for 20 years with a renewable option of 30 years. The total rights are for a period of 80 years. At the end of the period, the land goes back to the Indonesian state. The owner of the land is no longer the original owner but the government. The HGB is a right provided by the Indonesian government to build and manage the land. One of the advantages of the entity owning a HGB is the ability to use the land as collateral. According to Article 44 in the law 18/2021, holders of HGB (Hak Guna Bangunan) have the following rights: Use and utilise the land as specified in the granting decision and agreement. Build and own structures on the land for personal or business purposes, following legal provisions. Conduct legal actions such as transferring ownership, changing land use, or imposing dependent rights on the property. Hak Pakai The right of use (SHP) grants individuals or entities the ability to use and benefit from land controlled by the state or owned by an individual landlord through an agreement with the landowner. In terms of land ownership in Bali, the Hak Pakai can be obtained by: An Indonesian A legal entity in Indonesia A representative office A foreigner Each area and sometimes Kapubaten in Bali and Lombok define the minimal conditions to obtain a Hak Pakai. For example, the minimum requirement is a 5 billion investment with a building already built on a land with a maximum size of 20 ara in Badung. The Hak Pakai is providing the following rights: using and utilising the land utilising natural resources and water resources on the land ability to transfer the rights. Similar to the HGB the Hak Pakai can be collateralised with another party. The Hak Pakai has a validity of 30 years with an extension of 20 years and can be renewed for another 30 years. Also read: Complete Guide To Buying Property in Bali as a Foreigner [2024] Right of Freehold (SHM) Sertifikat Hak Milik known as SHM is granted to Indonesian individuals. It is the highest form of land or property ownership in Indonesia. It grants full and indefinite rights to the owner. Unlike the HGB or HGU, which have time limits, SHM is permanent and can be passed down through generations. Despite the certificate having no time limitation, it is important to note that the government and court can revoke the rights in certain circumstances or expropriate the landlord, as has happened in some areas in Bali. Foreigners and Legal entities are not eligible for this type of certificate and land ownership. HPL or Right to Manage The HPL is a certificate granting rights to entities to manage land for a certain period of time. This certificate is provided by the government to manage land owned by the government. Unlike other certificates, it is not possible to collateralise the certificate or transfer the rights to another entity. Make Navigating Real Estate in Indonesia Easy Save time and money by letting ILA’s team of experts guide your real estate journey in Indonesia. We can help with due diligence, land title transfers, notary services, contract drafting and reviewing, building permits, various licences and more. Find more information about our broad range of real estate services, or reach out today for a free consultation. Regulations for Foreigners Transferring Land Titles in Indonesia As described above, only a few types of land titles can be acquired and transferred by foreign entities: HGU or Business Rights HGB or Rights to build and own buildings Hak Pakai or Rights to use It’s important to note that Hak Sewa or Lease, which many foreigners commonly use in Bali, doesn’t grant legal land ownership in Bali or rights over buildings, and it cannot be transferred. The lease itself can be based on the contract but not legal ownership. The titles above are recognised by the Indonesian government in Bali and
Should You Use a Nominee for Your Company in Indonesia?
The nominee structure in Indonesia has been used and offered by some lawyers and agents for a while in Indonesia. A recent comment from the Indonesian government was calling for Indonesians not to lose their rights by providing a nominee in Bali. To be clear, a nominee agreement is illegal and is a crime. Here are the things before considering a nominee agreement in Bali, Indonesia. What is a Nominee in Indonesia? Nominee company A company with a nominee in Indonesia is a company using Indonesians as shareholders in a company in order to conduct an activity not allowed by foreigners. Lawyers and agents offer some agreement between the Indonesians and the foreigners to protect the foreigners and compensate the Indonesian nationals. The common practice is to offer: Loan agreement Pledge of shares as collateral Compensation agreement Nominee licence holder The notion of nominee also applies when a foreigner uses the name of an Indonesian in order to get licences that the person could not use if the foreigner was using their own name. This practice is used by some real estate companies and property management companies in order to get licences. Start your investment journey in Indonesia the right way With so many diverse investment opportunities in Indonesia, you need to make sure you’ve got the right setup to do business here. Get help from our team of experts to register your company, navigate the real estate market and secure your visa and stay permit. Schedule a free call with us today to plan your next steps with ILA. Why Do Companies Use Nominees in Indonesia? Foreign Ownership Restrictions Indonesia imposes restrictions on foreigners in several aspects, which can make it difficult to conduct business activities in certain domains: Real estate Marketplace Laundry Architecture Construction Mining etc The most common case is the one on the land. Indonesia has several types of land ownership, Hak Atas Tanah (HAT), and the most common right is the SHM (Hak Milik). This full right on land has no limitation in time, and some foreigners might be tempted to use their local partner or spouse to buy the land under the name of the Indonesian. On the other hand, some activities are not open to foreigners under a foreign investment company (PT PMA), and some lawyers or agents suggest opening a company PT PMDN with Indonesian shareholders (sometimes selling their own name) to go around the law to conduct the business. Minimum Capital Requirement in Indonesia Despite the law being sometimes confusing, corporate law is clear for companies. The capital of a company for foreign investment starts at 10 billion IDR (ten billion Indonesian rupiah). The amount of capital to deliver is 25% of this amount. Some investors might be sceptical about delivering this amount or investing it in a small business. At the opposite of a PT PMA, the PT PMDN (local company) requires only 51 million IDR (1 billion if the company hires a foreigner). Nominee Agreements Used in Real Estate The real estate sector is using nominees in several aspects. The most common practice in the last decades has been to purchase land by using the name of an Indonesian. This practice tends to disappear since PT PMAs are allowed to get some rights on Freehold property. Despite the acquisition, the real estate sector has used some stratagem to legitimise property rental in Indonesia on a daily basis by offering Indonesian names to be able to rent out a property on a daily basis or the landlord to apply for the licence. This practice is not secure and legitimate for the foreigner and the Indonesian itself as the tax should be paid under the licence holder, which is the Indonesian person. Having a Pondok Wisata under a local person and using its licence is a nominee licence holder. Other sectors in real estate, such as contractors, also use some nominees to be able to offer service of construction or get the building permit under the name of the landlord. Also read: How to Register a Holding Company in Indonesia (2024 Guide) Potential Risk of Having a Nominee for Your Business Having a nominee for your company in Indonesia is clearly illegal and against the principle of law of having restrictions. It is not rare to see the court cancelling agreements in relation with the nominee practice in Indonesia. The second risk is to have the nominee itself claiming its rights by selling the business, land, or taking over the business. Bali is full of stories of nominees, wives and spouse or partners taking over the business despite the agreements. Can You Make a Nominee Agreement More Secure? By definition, a nominee agreement is illegal. However, it is possible to partner with an Indonesian for certain activities and secure agreements. While some mechanisms, like loans or partnerships with foreign companies, are possible, using a nominee for your company in Indonesia is not a legal or beneficial option. Some lawyers or agents may recommend a pledge of shares, but this isn’t truly advantageous. Since the shares are under the Indonesian’s name (as foreigners cannot own them), the foreign party can only sell the shares to another Indonesian or attempt to force a sale, which ultimately isn’t beneficial for the business. We recommend you contact us to review the partnership agreement before entering into any deal. Alternatives to Nominee Agreement in Indonesia Since 2021, Indonesia has opened a lot of business sectors to foreign investment, and it is now possible to conduct business without having to enter into a nominee agreement. PT PMA can now purchase land certificates and conduct activities in some sectors. Setting up a PT PMA in Bali is a good alternative and a simple process to conduct business without a local person. The PT PMA allows 100% shareholding to foreigners in most of the sectors. The company can have local partnerships with local companies or provide some services as part of the local company’s activities. Also read: Your essential
Company Profile In Indonesia – Indonesia Company Search
There are several reasons you might need to check the company profile of a company in Indonesia. Whoever you are, an organisation, a NGO or an individual it is important to know with whom you are dealing and if the company is legit. Know your partners The KYC process is now commonly used by companies online or banks before entering into business relationships. However, as individuals, it’s important to know how to verify the legitimacy of the company you’re dealing with. This includes conducting a company background check to understand who the shareholders are and whether the director is legitimate. By performing a thorough company background check, you can ensure that the company you are engaging with is a legitimate legal entity in Indonesia. Get professional legal advice for Indonesia Indonesia’s legal system is complicated, with its many regulations, licences, and special rules for foreigners. Don’t make the mistake of trying to navigate it alone, and get the help of experienced consultants instead. At ILA, we can help you with intellectual property, corporate law, drafting, reviewing and managing legal documents, navigating commercial transactions and much more. You’re not alone. Reach out today to schedule a free consultation or read more about our legal service. Purchasing properties When it comes to purchasing a property in Bali, it is crucial for your contract to check if the developer is a legit entity here, if the real estate agent has the right licence to take a brokerage commission. Those parties will be in a contract and you need to make sure you can turn yourself to the court against a legit entity in case of dispute. Commercial agreement As a legal business or individual, doing business in a foreign country can be challenging to know with whom you are dealing. Having a website is not a guarantee of a legitimate entity, and the consequences of entering into a deal with a company without checking the company profile can have heavy consequences. None wants to start a business with a fake company or a director pretending to be one of the legit ones. Reasons to check the company profile in Indonesia Check if the company is legal Ensure the licences are still active Make sure the director signing the documents has the right Check the real shareholders and who is the owner of the company How to check the company profile in Indonesia Collect the data The first step is to know the name of the company and ask for the legit name. The portal name or commercial name can be different from the real name or legal name of the company. To conduct a proper company information lookup, you need to request the name of the company, starting with PT. Check to AHU It is possible to check with the Indonesian registry AHU the company profile. Although some websites can request 100 USD to check a company, the Indonesian government only charges a small fee to check the profile of the company. Also read: How to Register a Holding Company in Indonesia (2024 Guide) Report of a company profile After requesting the report, here are the details you will get: Company type (PT PMA, PT PMDN, etc. )and classification (KBLI) Licensing The date of last revisions to the Deed of Establishment. Registered address Size of capital. Number of shares and price per share. Shareholders and how many shares they own Directors and commissioners Ask to ILA If you can’t proceed with the payment or cannot check the company profile on AHU with the Indonesian registry, you can contact us for assistance.
Driving Licence Requirements For Foreigners In Bali
Whether you live in or come to Bali and Indonesia for holidays, you may want to buy or rent a motorbike or a car in Bali. As all countries in the world there are some requirements to have driving licence in Bali. With its beautiful surroundings and great weather, going around by yourself without a driver is an affordable and exciting way to explore the islands. Requirements to rent a motorbike in Bali Like other countries in the world, Indonesia has signed international treaties and recognised other driving licences from other countries. However, having a licence from your country is not sufficient. The travellers need to have an international driver licence attached to their national licence. The international licence needs to authorise you to drive the type of vehicle you are looking to drive in Bali. For example, if your international driving permit only authorizes you to drive a car, you cannot rent and drive a motorbike, and vice versa. The renter still accepts you to rent the motorbike or the car. However, if there is a police control, you will commit an infraction and need to pay a fine. In a worst-case scenario, if you have an accident, your insurance will not accept to refund you. Remember that hospitals are not like some countries in Europe, and you need to pay the bill if you want to be taken in charge by the hospital. Also read: How to Open a Bank Account in Indonesia for Foreigners (2024) Type of Driving License in Bali Driving licence for car and motorbike in Bali Indonesia has several types of driving licences depending on the type of vehicle you drive. The driver’s license in Indonesia is called a SIM (Surat Izin Mengemudi Indonesia). The minimum age in Indonesia to drive a car or a motorcycle is 17 years old. Obviously, in Bali, a lot of locals drive under age and do not respect this, but again, what you may see is not what needs to be done. Do not let your kids under age drive and expose them to a fine or bigger issues. SIM A: Driving licence for a car SIM C: Driving licence for a motorcycle Requirements to get the driving licence in Bali KITAS and SKTT Application form Fingerprint Medical certificate Psychological test result Pass both theory and practical or simulator examination If you wish to get your driving licence and get more information about it, feel free to reach out to us. We will let you know more about the process and how to get your driving licence. How to purchase a motorbike or a car in Bali As a foreigner, it is possible to purchase a motorbike or a car in Bali. Foreigners can get the administrative documents under its name, and it is cheaper to rent a motorbike or a car continuously. The requirements to purchase a motorbike or a car are as follows: Having a KITAS Get your SKTT (Civil registration) Be above the age of 18 years old Register the motorbike or the car with the local authorities Having an Indonesian driving licence
Necessary Documents To Live In Bali
Living in Bali, Indonesia offers a unique and enriching experience, but it’s essential to have the right documents to ensure a smooth and hassle-free stay. Whether you are an expatriate or a long-term visitor, having the necessary paperwork will ease your stay and help you to be in line with the regulations and immigration rules. If you plan to move to Bali and are looking to buy a motorbike or a car or obtain proper health coverage, here is a comprehensive document checklist of essential documents you should have while living in Bali. ITAS If you plan to move to Bali, the first and most important immigration document to be considered a resident in Indonesia is the stay permit called KITAS (Kartu Izin Tinggal Terbatas). The KITAS is delivered by the immigration department to foreigners meeting some requirements such as being an investor, a spouse of Indonesian, in retirement, a worker, a student, a remote worker or a KITAS holder having a dependent or a spouse. The validity of the ITAS varies from 6 months to 5 years, depending on the type of visa. The foreigner can apply for permanent residence (ITAP – Izin Tinggal Tepat) after 5 years in a row with the same sponsor on its KITAS. As a reminder, foreigners who are directors of a company or working in Indonesia are obligated to have a stay permit (KITAS) in line with the immigration rules. Having a KITAS is not a sufficient condition for working in Indonesia. Being a director in a company might involve applying for a working permit (IMTA). Get professional legal advice for Indonesia Indonesia’s legal system is complicated, with its many regulations, licences, and special rules for foreigners. Don’t make the mistake of trying to navigate it alone, and get the help of experienced consultants instead. At ILA, we can help you with intellectual property, corporate law, drafting, reviewing and managing legal documents, navigating commercial transactions and much more. You’re not alone. Reach out today to schedule a free consultation or read more about our legal service. SKTT and NIK Number The SKTT (Surat Keterangan Tempat Tinggal) is a document attesting to your residency in Indonesia. It is a civil registration for each citizen or foreigner living in Indonesia. A foreigner with a KITAS or KITAP has to declare any change of residence to the immigration office and provide the SKTT with the correct address. This document is necessary to purchase a motorbike or a car or get an NIK Number. The procedure to get an SKTT has to follow the Get a police report and declare your address Residents in Bali need to contact the local Banjar or go to the Desa, where their residence is located. Resident outside Bali, such as Jakarta, can declare their residency online As a reminder, KITAS holders need to declare their new address to the immigration office and change the immigration office if the address is different from another immigration office. The NIK (Nomor Induk Kependudukan) is a resident identification number valid for the lifetime of the individual. This number is a unique number for each resident or citizen. This number is important for several admission purposes, such as getting private insurance. Also read: Remote Worker Visa (E33G): Visa for Digital Nomads in Bali NPWP and EFIN NPWP (Nomor Pokok Wajib Pajak) It is not the most pleasant document, but it is definitely one of the most important for any worker, resident, or investor with a KITAS in Indonesia. If you plan to move to Bali, the NPWP is an essential tax number for the taxpayer. The tax card is important for each KITAS holder who needs to declare their tax in Indonesia or wishes to become a tax resident. The NPWP is necessary for tax administration purposes and is essential for the following: Tax Reporting: Individuals and entities use the NPWP to report their income and pay taxes. It is a requirement for filing annual tax returns. Banking: An NPWP is necessary to open bank accounts or to apply for loans, as it provides proof of tax registration. Business Transactions: Companies and businesses are required to have an NPWP to issue invoices, receive payments, and conduct transactions. Government Services: Various government services and permits may require an NPWP to process applications. The tax card is mandatory for a foreign director in a company. The personal NPWP is different from the company NPWP. The tax card is available online with the tax office department. As director of the company, the director is responsible for declaring its personal tax to be able to declare the company tax. A digital nomad or remote worker in Bali needs to also obtain its tax number if while residing more than 183 days in Indonesia willing to become a tax resident in Indonesia. EFIN (Electronic Filing Identification Number) The EFIN is necessary to log in to the tax office website. The taxpayer has to go to the tax office of its residence to get the identification number. This number is necessary to fulfil the annual tax report for companies and individuals. Also read: Indonesia implements the “Bridge Visa” SIM (Driving licence) When visiting Bali as a tourist, an international driving license is mandatory for foreigners willing to drive a motorbike or a car. However, if you decide to move to Bali and obtain a KITAS, you must apply for a local driving license (SIM C to drive a motorbike). The driving license can be obtained at the police station. Our team can assist in understanding the process. BPJS. Companies also have to subscribe to the BPJS Ketenagakerjaan for their employee in order to ensure any work accident to their employee, which is a legal document that ensures coverage for work-related accidents. This monthly subscription is compulsory. Companies also need to pay the BPJS Kesehatan to cover any health issues their employees may have. After applying to the BPJS, the worker will receive a social security number and a card to present while
Legal Considerations For Leasehold Property In Bali
This article identifies the key things to consider when leasing property in Bali and the rest of Indonesia, such as Lombok. There are some steps and factors to pay attention to when dealing with developers, real estate agents, and sellers of a property. As a reminder, a leasehold is a private contract between two parties. This means that the terms and conditions are defined by the content of the agreement, and any dispute will be related to the clauses in the agreement. Due Diligence on the party During my first trip to Bali, I remember arriving to a world at the opposite of the cartesian rules and clear functions of each party involved in a transaction or a contract. As I used to say, Indonesia has clear rules however their application and how some actors play with the rules might be disorienting buyers in their purchase journey. Due diligence on the Broker or Real Estate Agent When purchasing a property, the first party you will probably meet is the broker or real estate agent. Indonesian law clearly states who can be an agent or a property broker. The broker needs to have a special licence and be a member of the Broker Association (AREBI). However, it is unfortunately common to see brokers acting on a system commission without any licence. The broker or real estate agent is taking a commission from the seller. By definition, this broker or real estate agent is not representing your interest but the interest of their client, which is the seller. Professional real estate agents take care of both sides, and there is a lot to recommend when working with proper license and professionalism. The agent is supposed to also advise the client about the regulation and how the process works. However, having an unlicensed agent might cause you to face some issues during the process of leasing property in Bali, with the broker exercising pressure on the buyer. Check on the Seller When leasing property in Bali, whether dealing with an agent or not, it is important to understand who the seller of the leasehold is. It is not rare to see some leaseholders in Bali selling a lease while they are not the owner of the land or the building if they decide to sublease or transfer the lease ownership. The owner of the land or the leasehold will be the person with whom you need to deal on the day-to-day or if something happens. By law, having a leasehold doesn’t mean the lessee is the owner of the land. It is recommended that you initiate good relations with your landowner or lessor in order to prepare the terms and conditions of your contract. It is not rare to see multiple owners on a property in Indonesia. I remember a case with 11 owners all around Indonesia, and the difficulty there was in the end in getting everybody to sign the lease. Those 11 people or their descendants will be the owners and people you will have to deal with. Due diligence on the Developer Bali and Lombok have magically seen developers and contractor companies emerging in the last few years, selling off plan properties. Some developers might have rights on the lease and subletting or transferring you a leasehold property they have purchased in order to build and resell the rights to the lessee. Developer and contractor professions are highly regulated in Indonesia. We recommend analyzing the licence of the developer before entering into an agreement with the party. We have seen several developers on the market who have no experience overseas or even operate here with no license. A proper contractor is required to have at least an Indonesian partner in order to operate in the construction field. Indeed, depending on your contract, a contractor or developer with no licence might disappear and let you have a property once the deal is done without any insurance on who to complain to if there is an issue. The Indonesian procedure might take months and years. Even the recent episode with a big developer in Uluwatu shows that the incident might let investors off-plan property with delays and delays on their project. Other experiences in Sumba have also been reported. Therefore, it is essential to thoroughly vet developers when leasing property in Bali to avoid potential pitfalls. Also read: Property Contracts And Due Diligence In Bali And Indonesia Use an independent Notary Once you have found your property, one of the third parties you or the lessee will engage in the transaction is the Notary. This profession is also highly regulated in Indonesia. However, notaries work closely with developers or sellers. I rarely see a transaction ending with a NO GO from a notary who gets commission on the transaction. We usually recommend that the buyer choose a notary independent of the seller (contact us for recommendations). Fees from notaries usually range from 0.5% to 1% of the transaction. Once all parties in the process have been identified and defined, the next step is to understand the key points to check on the property itself when leasing property in Bali. Make navigating real estate in Indonesia easy Save time and money by letting ILA’s team of experts guide your real estate journey in Indonesia. We can help with due diligence, land title transfers, notary services, contract drafting and reviewing, building permits, various licences and more. Find more information about our broad range of real estate services, or reach out today for a free consultation. Due Diligence on the property Zoning When leasing property in Bali, it’s crucial to consider the zoning regulations, which dictate the permissible activities for each type of zone: Green Zones: Reserved for agriculture. Yellow Zones: Primarily residential with some allowance for business activities. Pink Zones: Designated for tourism and larger-scale activities. However, the color designation alone provides an indication, not a definitive confirmation. Each plot must be thoroughly assessed to verify what activities are permissible based on the
Indonesia implements the “Bridge Visa”
Indonesia implements a Bridge visa for foreigners currently in Indonesia who are planning to change their visa status or their limited stay permit. The bridge visa allows foreigners to apply for a Limited Stay Permit (KITAS) or a Permanent Stay Permit (KITAP) without having to leave the country. Visa Run from Indonesia The objective of the bridging visa is to prevent foreigners from leaving Indonesia during the transition of their stay permit. Similar to the onshore process implemented during the Covid, this Bridge Visa saves costs to foreigners who do not need to travel overseas to Singapore, Australia, Thailand, or Malaysia and enter Indonesia to activate their visa once this one has been issued. Your visa process made easy with ILA Indonesia has so many visas to choose from, each with its own requirements, regulations, and duration. With more constantly being issued by the government, it can be hard to keep track and choose one that is right for you. With the help of ILA, you can be sure that you’ll get the best visa for your needs as quickly and efficiently as possible without having to worry about any missing documents. Whether you’re looking for an Investor KITAS, Working KITAS, Second Home Visa, Spouse KITAS, Multiple Entry Business Visa or Remote Worker Visa, we can help make the process efficient and smooth. Schedule a free consultation today or learn more about the different visa options. Bridge Visa for KITAS holders changing their type of KITAS KITAS holders who have a limited stay permit going to expire and need to change sponsors can now stay in Indonesia and do not need to fly out and reenter the country to activate their new KITAS. This simplifies the visa application process, making it more convenient and cost-effective. Bridge Visa for Temporary Stay Permit to Limited Stay Permit The great news is that travellers with a temporary stay permit, such as Visa On Arrival who can now use this bridging visa during their transition process to a Limited Stay Permit. This new bridge visa allows the foreigner to stay in Indonesia even if their VOA has expired without overstay. As a reminder an overstay in Indonesia costs 1 000 000 IDR per day of overstay. Application process The process is simple. Foreigners need to apply 3 days at least before the expiration date of their current visa. They need to log in online to https://molina.imigrasi.go.id/ in order to get a 60-day bridge visa. This time period is sufficient to get the new KITAS. It is important to note that this bridge visa is not a multiple entry visa. You can contact us to know more on how to apply for the bridge visa or if you are currently looking for a Limited Stay Permit (KITAS) for Bali and the rest of Indonesia.
How to register a boat or a vessel in Indonesia?
In this article we review how boat owners or business owners can take opportunities to set up a company in diving, water tourism and operate a boat in Indonesia. We also cover the boat registration in Indonesia. The country is the biggest archipelago in the world with 14 000 islands and a lot of tourism opportunities and sea ressources. Boat ownership in Indonesia The Indonesian government authorises crew members and boat owners to sail the Indonesian ocean. While boat owners can sail and transit in Indonesia and get a 3 years authorization with a simple vessel declaration (VD) under a foreign flag. However the process becomes slightly more complicated if a foreigner wishes to register the boat under the Indonesian flag. Indonesia is restricting the ownership of a vessel under an Indonesian name or under an Indonesian entity. Boat registration in Indonesia under 7GT Indonesia makes the registration procedure based on the gross tonnage of the vessel. If the gross tonnage of the boat is under 7GT, the boat has to be registered at the local harbour (PasKecil) and registered in the central base of the government https://paskecil-ditkapel.dephub.go.id/ This type of vessel used for daily scuba diving trips, fishing or other daily activities do not need to get an Indonesian flag to travel overseas and are limited to a few miles from the coast. Boat registration in Indonesia above 7GT Boat ownership is limited in Indonesia to Indonesian national or Indonesian entities with a majority of Indonesian shareholders. Foreigners can register or import a boat under a company called PT PMA and register the vessel under the company. The purchase and boat documents have to be proceeded under the company. The boat documentation is dependent on the gross tonnage of the boat. Each vessel has in common a document called Gross Akta. This document is the ownership of the boat. Vessels above 500GT and 1000 GT require several additional documents or a certification from the BKI (the Indonesian office of classification). To register the vessel with the ministry of transportation, the boat owner has to provide the following documents
A Guideline on How to Create a Foundation in Indonesia (Yayasan)
Foundations in Indonesia are known under Yayasan and are regulated by the Foundations law (Law No. 16 of 2001 amended by Law No. 28 of 2004 (“Foundation Law”), and Law No. 17 of 2013. In this articles we are reviewing how to establish and create a foundation in Indonesia and the criteria to do it. A foundation is a type of legal entity created for purposes such as social, religious, or humanitarian work and is designed to operate indefinitely. Its primary goal is not to generate profit for distribution among its founders or the members. Different types of foundation in Indonesia If you plan to open a foundation in Indonesia or a place like Bali, the government makes a distinction between foundations based on the founders of the Yaysan. Local Foundation A local Yayasan is considered local when all the founders are Indonesian. The contribution of the founders to the local Yayasan is only 10 000 000 IDR. The process to establish is fast and easy. The founders need to sign a deed (Akta) at the notary and get the ministry approval (MOHLR). Foundation founded by a foreign entity If you are planning to open a branch of your foundation in Indonesia it is not possible to have a legal relation between the entities. However Indonesia offers the possibility to establish a Foreign Yayasan if you already own a company in Indonesia. This entity should exist at least for 5 years. The capital contribution should be 10 000 000 000 IDR which is the same as the PT PMA (LLC). The foundation needs to get a recommendation from the Ministry of Foreign Affairs (MOFA) and then get approval from the Ministry of Law and Human Rights (MOLHR) to create a foundation in Indonesia. Foundation founded by foreign individuals Similar to the previous one, Yayasan with at least one foreign founder, needs to follow the similar process of approval with the MOFA and MOLHR. The foreigner must have been resident in Indonesia for at least 5 years. However, the initial contribution is lower at 1 000 000 000 IDR. Type of YaYasan Initial Contribution Local 10 000 000 IDR Foreign with at least one foreign founder 1 000 000 000 IDR Foreign founded by foreign entity (PMA) 10 000 000 000 IDR Read Also: 12 Things To Know To Create A Company In Indonesia Registering a company in Indonesia has never been easier Setting up a business abroad can be challenging with so many documents, laws and regulations to consider. Luckily, the process will be a breeze, and we’ll give you expert advice on which business structure and setup will fit your needs. Reach out to the ILA team today to set up a free consultation or read more about the company registration process. Organisation of a foundation – NGO – YaYasan in Indonesia Founders The founders are the person or entity initiating the creation of the foundation, YaYasan in Indonesia. Board of Trustee Chairman The chairman of the board of Trustee can be one of the founders. If there is more than one founder in the BOT they all sit as chairman of the BOT. Members of the BOT If the foundation is a local YaYasan, foreigners cannot work under the BOT. However if the YaYasan is a foreign one, the BOT can hire foreigners to sit at the board. The foreigners have to apply for a work permit and get a limited stay permit (KITAS) Scope of the BOT The members can dismiss the board of management and supervisors. The BOT prepares and approves the budget and defines the orientation of the foundation. Board of Management Chairman – Secretary – Treasurer The chairman of the BOM is appointed by the board of Trustee (BOT). The members are appointed for a period of 5 years. At least one Indonesian has to sit at the BOM. However only Indonesians can sit in a local foundation. Scope of the BOM The board of management is responsible for handling the operations on a daily basis. In a foundation, they may face personal and joint liability in cases of bankruptcy or if financial statements are misleading due to their wrongful actions or negligence. They are also at risk of personal liability for failing to fulfil their responsibilities. Board of Supervisors and Advisors Members At least 1 supervisor. Foreigners can sit in the BOS if the YaYasan is a foreign YaYasan. Foreigners need to apply for a work permit and a limited stay permit (KITAS). Scope of the BOM The BOS is responsible for supervising the BOM and can held as accountable in case of bankruptcy or illegal activity of the YaYasan. FAQ Can I hire foreigners under a YaYasan? A foundation can hire foreigners and has to apply for a working permit and get a KITAS for its employee Can foreigners create a foundation in Indonesia or Bali? Yes foreigners can create a foundation is they have been resident for 5 years Can I get a salary from the foundation? Members of a board cannot get a salary from the foundation except if they are members of the Board of Management only.