If you are still performing the Indonesian market research and you don’t have huge financial capital dedicated to investments in the Indonesian market, you can choose the Representative office, which gives 100% control to the mother company, abroad. Nevertheless, the Representative office in Indonesia cannot perform any business transactions.
FOREIGN REPRESENTATIVE OFFICE (KPPA)
Establishing a foreign representative office in Indonesia (Kantor Perwakilan Perusahaan Asing – KPPA) is a market entry, allowing you to create a market presence with almost no finances. KPPA is more general than a Foreign Trade Representative office in Indonesia (KP3A) and is usually set up for management purposes. The role is limited to: supervising, liaising, coordinating, managing and representing the parent company.
Cekindo will need the following documents to help you set up the company:
- Notarized letter of intent
- Notarized letter of appointment
- Letters of reference
- Resume and work permit of the company representative
FOREIGN TRADE REPRESENTATIVE OFFICE (KP3A)
Apart from the activities, which the KPPA can perform on Indonesian market, this representative office can also act as buying and/or selling agent. Nevertheless, it is still only representative office, therefore it cannot conduct the sale itself, or issue invoices, that’s a role of the parent company abroad.
The process of establishing a KP3A is same as the set-up process of the Foreign Representative Office (KPPA). The difference is that in this case, all documents such as the Letter of Intent or Letter of Appointment must be signed by a notary in the country of origin and legalized by the Indonesian Ministry of Foreign Affairs.
FOREIGN CONSTRUCTION REPRESENTATIVE OFFICE (BUJKA)
The BUJKA Representative office is a bit different from the KPPA and KP3A and it is suitable only for companies operating in the construction area. To set up the Representative Office for Construction (BUJKA), companies need to qualify for a license SIUJK, which is needed for operating in the construction area in Indonesia and is valid for 3 years, with the possibility of extension.
Foreign Construction Representative Offices in Indonesia also need to cooperate with local companies:
The distribution of work for the construction activities is as follows:
- At least 50 percent of the value of construction work is performed in Indonesia
- At least 30 percent of the value of construction work is performed by the Indonesian construction company.
The distribution of work for planning activities is as follows:
- The entire technical planning work is performed inside Indonesia
- At least 50 percent of the value of construction planning work is performed by the Indonesian construction company.
