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  • CV versus PT?

    I am considering creating a company in Indonesia. My wife is indonesian and I've been working here for long enough. I now want to retire and would like to create a medium size business for or with my wife. I've heard a lot about C.V and P.T, but so far no one has managed to explain me clearly the differences in between them. Anyone?
    [img]https://s32.postimg.org/9q8j0piqt/logo.png[ /img]

  • #2
    There is quite a few differences in between CV and PT which are better to be aware of.
    Though both require a minimum of 2 person (pendiri) to create it, the CV is strictly reserved for Indonesian citizen and 100% of its capital must be indonesian, while the PT can be created by a foreigner an it’s capital can be own by a foreign investor in part or in totality. It is then called a PT PMA.

    A CV is a simple business entity (badan usaha) very lightly regulated by the indonesian commerce code (KUH Dagang) while a PT is a legal corporation (badan hukum) which is regulated by its own statute (Undang-Undang nomor 40 tahun 2007 tentang Perseroan Terbatas). A PT, being a corporation has legal rights and is an entity separate from its owners, who have a limited liability (their liability is limited to the capital invested). It is very different, in this regard, from a CV which is much more like limited partnership or sole proprietorship companies with a full liability of the pesero aktif/direktur who has to assume debts and obligations of the CV, even on his/her private property (pesero aktif adalah orang bertanggung penuh melaksanakan kegiatan perusahaan, termasuk kerugian yang harus ditanggung oleh harta pribadinya). This is something to be fully aware of if one is married with an Indonesian citizen who plans to create a CV. There is implications that must be thought of. Caveat emptor.
    A PT has it's capital divided in between it's shareholders. A CV, generally belongs to one pesero aktif (direktur) who owns the totality while the komanditer/pesero pasif has no or little power. He is often just here because the law says that there must have 2 persons...
    Also, a PT has a capital of minimum IDR 50.000.000 (25% of which must be available at the creation of the PT) and mention of it must be done in the akta pendirian of the PT. Any change in the capital must be reported and have the approval of depkumham (PT) or BKPM (PT PMA). A CV has no such obligations, no minimum of capital and no need to mention it to Depkumham. It is only mentioned in its Surat Izin Usaha Perdagangan (SIUP). It doesn’t mean however that a CV is necessarily a small company. It ain’t rare to bump on a CV with a capital superior to the one of quite a few PT.

    Administratively speaking a CV is much more flexible and light than a PT. However, a certain number of sectors are closed to CV and a PT is therefore an obligation if your targeted business is in one of these sectors. Don’t expect to create an airline company or a banking institution, for example, with a CV, it won’t lead you anywhere. A CV is more for a local use/field of action and more suitable for what we call UKM (Usaha Kecil dan Menegah). It requires only a registration to the local Pengadilan Negeri (beside the obtention of a SIUP & a TDP) and no approval from the minister of Justice and Human Rights. Also, a PT must have it’s name approved by the minister and can’t have the same or a similar name of any other PT throughout the archipelago. This is different for a CV. Pick a name you fancy, go to see a Notaris and that’s it. Call yourself CV Garuda, CV Kokakola or CV Gratillaisgonnasaythatmypostistoolong and you will be able to do bisnis with no trouble. The administrative lightness of the CV compare to a PT results in a difference of cost at its creation or to operate it. With 3 millions, maybe less, I would get you a ready to operate CV in 10 to 15 days in Manado, including the akta pendirian (the most expensive), the surat Keterangan Domisili, the NPWP, the SK-PKP, the pendaftaran PN, the SITU, the SIUP and the TDP. A PT, managed alone, would cost you twice this amount or even more if you deal with an "agent" and would take you close to 2 months maybe.

    Last, CV stands for Commanditaire Vennootschap (sorry it’s dutch) or more poetically Persekutuan Komanditer / Perseroan Komanditer in Bahasa Indonesia, while PT stands for Perseroan Terbatas (limited company in English).

    I hope it has clarified it a bit, despite the length of the post.
    Last edited by atlantis; 17-08-10, 20:29.

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    • #3
      Thanks Atlantis, much obliged.
      [img]https://s32.postimg.org/9q8j0piqt/logo.png[ /img]

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      • #4
        [FONT=Calibri][SIZE=3]Atlantis,[/SIZE][/FONT]
        [FONT=Calibri][SIZE=3]I have some question in regards to this 50,000.00 Investment funds, How does this work, Say i put up 25% of it must i keep this in the bank account and kept there always or can this be taken back out?[/SIZE][/FONT]
        [FONT=Calibri][SIZE=3]Does the Tax man, Tax the 25%[/SIZE][/FONT]
        [FONT=Calibri][SIZE=3] [/SIZE][/FONT]
        [FONT=Calibri][SIZE=3]I'm also confused on whether to open up CV or a PT, I have a Indonesian partner whom i trust and work with. I will be operating this business together within but i also need this business to sponsor me here in Indonesia.[/SIZE][/FONT]
        [FONT=Calibri][SIZE=3] [/SIZE][/FONT]
        [FONT=Calibri][SIZE=3]We will be conducting business in few different fields, so we are heading into the PT direction. Now i have been notified PT can go into 3 lines of business.[/SIZE][/FONT]
        [FONT=Calibri][SIZE=3] [/SIZE][/FONT]
        [FONT=Calibri][SIZE=3]So what if we select General Trading does this title as a licence allow us to trade in many different fields, Example. Advertising, Import/Export etc etc.[/SIZE][/FONT]

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        • #5
          [FONT=Tahoma]I am going to avoider agents so for the creation of PT is the Notary service best to contact? I would like to open one up in bogor.[/FONT]

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          • #6
            Dont get to hung up on the capital, its a numbers game I am sure your Notaris will be able to sort it for you, however it is a legal requirment. What ever you do if you choose a PT company (not PMA), make your wife the director. The Chairmen (Komisaris) although the "head" of the company is a toothless tiger regardless of the % owned.

            Once again Atlantis has nailed it.
            This will do me...

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            • #7
              I heard that after this month (Sept 2010) a CV can't sponsor a foreigner for a kitas / work permit, only a PT... is that true?

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              • #8
                Westerner to Locals ratio

                So if for example we are looking to create a PT. What are the limitations with regards to the number of westerners able to work under that PT?

                The question is due to the entity we wish to open in Bali has two western directors. Would they be covered by a PT business license? If so what are the base requirements for number of local workers per westerner?

                In advance, thanks.
                Balibaba

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                • #9
                  Originally posted by jonboy View Post
                  I heard that after this month (Sept 2010) a CV can't sponsor a foreigner for a kitas / work permit, only a PT... is that true?
                  Copy of 3 posts from the thread : http://www.livinginindonesiaforum.or...ighlight=KITAS

                  (1) Posted by Newgabe , 08-02-11
                  [I believe that a CV company can no longer sponsor a KITAS. My neighbour has just been refused an extension of hers (she had for 2 years previously). I'm just posting this quickly so perhaps someone can add when this law changed/started to be enforced.]

                  (2) Posted by Fred2 , 11-02-11
                  [We have a small CV with only 6 employees, We were told that as of the 1/10/10 CV can no longer have Kitas. IN immigration in Jakarta we were told the same, We have a local friend in Bali that has a hotel he has changed from a CV to PT because of this problem. Any help.]

                  (3) Posted by Atlantis , 22-02-11
                  [Funnily enough I have friends who have renewed KITASes sponsored by a CV without problem, but all of them were sponsored by CV having a SIUP menengah atau SIUP besar. And there is no PerMen recently enacted forbidding a CV to sponsor a foreigner. I believe that the problem may be somewhere else but I still can't figure it out. I know quite well the kadis disnakertrans in Manado. If I bump on him, I'll try to get why it bugs in some places.]
                  Last edited by marcus; 07-03-11, 19:26.

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                  • #10
                    i will surely help for the tax calculation here; if u have PT then :
                    * net income Rp.100.000.000 x 25% = Rp.25.000.000
                    but if u want to withdraw ur capital such as deviden, then there will be more tax is deviden tax for personal receiver is 10% final

                    but if u had CV then will become:
                    *net income Rp. 100.000.000 x 25% = Rp.25.000.000
                    but when u will withdraw the capital u won't get any more charge of tax, because the sharing income in CV is a non tax object here

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                    • #11
                      HI atlantis / all
                      Forgive me for being a total donut here...
                      1/ Can I, as a UK citizen provide funding for a cv business to be registered in an Indonesian friend's name?

                      2/ If I can do this - am I allowed to work in this business as a manager/director?

                      3/ If so, can they sponsor me with a KITAS?

                      4/ My ultimate goal is to get a KITAP (citizenship) in this country and to live here and to do things that I may be restricted from doing on KITAS (street kids project- different thread).
                      -the information in the above posts sort of helps but also confuses me.
                      Cicak Magnet

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                      • #12
                        Originally posted by bad_azz
                        1/ Can I, as a UK citizen provide funding for a cv business to be registered in an Indonesian friend's name?
                        You shouldn't do this unless you are able to accept losing your money. I know many horror stories. Even if you trust your friend and have a good relation with him or her, this doesn't mean it will always be the case. I know some guys who lost everything when their wives decided they wanted to divorce many years after they had bought land and businesses with their wives names.

                        Later, lane:
                        Brigadier

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                        • #13
                          I am thinking that losing the money will not be a problem brig - (erm fromagier...)
                          There will be no marriage.
                          I will not be buying land, just access to a visa and getting a job.
                          Cicak Magnet

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                          • #14
                            Originally posted by bad_azz View Post
                            I am thinking that losing the money will not be a problem brig - (erm fromagier...)
                            There will be no marriage.
                            I will not be buying land, just access to a visa and getting a job.
                            I think what he is trying to advise you on , is that you will be reliant 100% on someone else , and if things go pear shaped as they often do and for reasons a many , you will have no comeback . To put that 100% trust into someone is risky business no doubt , and with all the positives you may think up , its is equally important to consider the negatives and worst case scenereos.

                            I cant advise you much on kitas etc , as im a newbie at this also , so I will try to within my limits ( others will helpfully chime in If my info is inaccurate )...,

                            For a working sponsored kitas as your talking about , there are many strict restrictions and conditions to it ( look in search for threads on this ) , and you also need some type of specialist experience that is not already available here in order for you meet the required criteria , so you will need to do some more homework on this one .

                            Also , badas , a kitap isnt citizenship , think of it as a kitas that lasts for 5 years ...,
                            To be a citizen has many many more requirements , and If granted you will have to say bye-bye to your UK citizenship.

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                            • #15
                              Originally posted by bad_azz View Post
                              1/ Can I, as a UK citizen provide funding for a cv business to be registered in an Indonesian friend's name?
                              A CV is a 100% indonesian controlled entity. It means that NO foreigners can be either Direktur of Komisaris in the akta pendirian of the CV, in one way or another. The ownership MUST remain Indonesian. It could be acceptable that you lend money to your friend, but it could not be acceptable that you are indirectly the owner of it.

                              Originally posted by bad_azz View Post
                              2/ If I can do this - am I allowed to work in this business as a manager/director?
                              Depnakertrans has been known recently to refuse to issue IMTA to CV. I have to say that I do not see with what dasar hukum they base their decision to unilateraly refuse to issue IMTAs to a CV. As long as the CV complies with the stipulations of the Manpower Act and the subsequent regulations from the Ministery of manpower and Transmigration, they should not be forbidden to hire expatriates. However, we had reports from a couple of users who had their work permit refused with the reason that "no IMTA are delivered anymore to CV". It is a bit light of a reason to me, especially when I know CVs in my region who had such IMTA renewed. It is true that both case I know are CV with SIUP being superior to 200 millions and with enough local manpower to comply with Depnakertrans ministerial decisions concerning expat employment .

                              Originally posted by bad_azz View Post
                              3/ If so, can they sponsor me with a KITAS?
                              See above

                              Originally posted by bad_azz View Post
                              4/ My ultimate goal is to get a KITAP (citizenship) in this country and to live here and to do things that I may be restricted from doing on KITAS (street kids project- different thread).
                              -the information in the above posts sort of helps but also confuses me.
                              KITAP is required prior to citizenship application ONLY for people not being married with an Indonesian.
                              A KITAP or a KITAS have pretty much the same restrictions when it comes to work. Only the length of the residency permit differs. if you manage to obtain a KITAP it doesn't mean that you will have less restriction in the fields you may be authorized to work
                              I know of NO CV which managed to organize the conversion of an ITAS in an ITAP for any of his employee. If there are, they have seriously "motivated" their employee's application. CV and KITAP doesn't sound straight in my ear if I consider the law. A CV is predominantly a small company with only a regional implication. A KITAP for a worker is given after assessment of his/her participation in the national development in a significant manner.

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