Shelf Company Indonesia: Is It Different from A Shell Company?

We may still remember about news that was highlighted a few years ago about offshore companies from the Panama Papers, which leads to a heightened interest and curiosity in regards to shell companies and shelf companies. 

Both shelf companies and shell companies are commonly related to offshore businesses. There is a misconception that these two types of company are illegal of which they are operated for the purposes of money laundering, tax fraud, etc. This misconception is further from the truth because as with any investment instrument, shelf companies and shell companies can be utilised for either good or bad. It is the human behind these companies who make the operations to be lawful or against the law.  

When it comes to doing business in Indonesia, you may have heard of the option of purchasing a shelf company as the fastest option to penetrate the market. This is indeed true. But before we discuss the benefits of having a shelf company in Indonesia, it is interesting to firstly know about the difference between a shelf company and a shell company.

So how is a shelf company different from a shell company then? In order for you to be able to utilise these two companies legally, Cekindo is here to guide you on how you can differentiate these two investment vehicles. 

Shell Company vs. Shelf Company in Indonesia: The Difference

Shell Company

Shell corporations are not in themselves illegal, and they do have legitimate business purposes.

A shell company is completely different from a shelf company. A shell company gets its name because it is described as an empty shell that is only used for business transactions but in fact it does not have any significant operations or assets.  

Shell companies are not illegal and they can be established with totally legal process. However, in reality, they do not possess any legitimate business purposes. Most of the times, they are only incorporated in other tax-haven countries to avoid tax obligations, and this is the reason most people perceive a shell company to be illegal.  
 
Individuals or groups with ill-intention will probably misuse shell companies for illegal activities such as money laundering and tax evasion.

Shelf Company

A shelf company, as the name implies, is a company that has been registered legally earlier and left on the ‘shelf’ to age.  Once it has achieved its age, a shelf company, also known as a read-made company, will then be sold to interested investors. This aged corporation has clean records, which means that it does not have any unlawful activities going on.

The selling and purchasing of this type of company also complies with the law. The purpose of selling a shelf company to a newcomer is to cut down the time and eliminate the hassle that a person or a group has to go through for setting up a brand new company in Indonesia.

Furthermore, the age or longevity of a shelf company is a crucial factor that most investors opt for this form of entity instead of a new company. 

The “oldness” of a shelf company provides benefits such as faster formation, higher credibility, enhanced chances of leasing, loan and project tender opportunities, etc. 

Why Is a Shelf Company Good for Your Business in Indonesia?

A shelf company is completely legal in terms of its registration, existence and structure. The proper use of a shelf company can actually offer your business more benefits than you can ever imagine. Below are some of the advantages of using a shelf company:

  • Save you time and money
  • Able to bid for contracts immediately
  • Instant access to management control rights
  • Fast process with changes of owner’s name, shareholders, directors, and business name
  • Building relationships with banks and financial institutions for easy business account and loan application 
  • Easy and hassle-free process through a shelf company provider 

Shelf Company in Indonesia from Cekindo

Cekindo offers a shelf company solution in the form of local PT. We constantly update our list of available shelf companies to provide you with the best shelf companies with various ages to suit your business needs. 

The whole process of shelf company purchase through Cekindo can be done completely online.

Get in touch with us today should you require further information on shelf company in Indonesia or buy your shelf company of choice now.

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