How Can a Shelf Company Help When Conducting Business in Indonesia?
Indonesia can be a challenging environment for foreign business people who aren’t familiar with the local culture. One challenge that foreigners will face is getting local companies to trust newcomers in the country’s business arena. Foreigners who are really new to Indonesia may find themselves politely rejected because of this. The good news is that foreigners can look for shelf companies that have already been set up for some years. That way, foreigners will have an easier time doing business with the Indonesians.
Who Sets Up a Shelf Company?
A shelf company in Indonesia is basically set up specifically to be bought by foreign business people. Local banks trust companies that have been around for some years in Indonesia. However, these banks do not easily trust companies set up by foreign owners. This means a foreigner who wants to set up a foreign-owned company will encounter a stringent series of business regulations. It is easier to just buy a shelf company that was incorporated by locals.
Is It Legal to Put Up a Shelf Company?
It is a common practice among Indonesian businesspeople to set up a shelf company. For one thing, it follows the Indonesian Company Law because it is set up by bonafide citizens. This is why locals register the company then simply wait for the right foreign investors to buy it.
Buying a Shelf Company Earns Trust of Indonesians
It may be difficult for foreigners to be trusted in a conservative business environment such as Indonesia. There are contracts both from the government and the private sector that are not offered right away to foreign-owned businesses. Even Indonesian banks are wary of dealing with foreigners. So the first benefit of shelf company help is that you will gain the trust of locals. This may open doors for you even if you’re a foreigner.
Foreign Business People Save Time
Another benefit is that foreign businesspeople will save time by avoiding the strict process of registering a foreign-owned company. Buying a shelf company will simply be faster and simpler for foreigners. It can even be done online! And this is good for foreign businessmen because timeliness is money in business.
Local Banks Will Make Doing Business Easier
The third benefit is that local banks will make it easier for your company to do certain functions. These include: opening a business bank account, securing business loans, and even qualifying for a business credit card. Banks will feel more comfortable dealing with you if you opt for shelf company help as well. This means you may get more favorable interest rates when you do business with local banks.
Even the most well-meaning foreign business person can encounter some distrust among locals when you enter the Indonesian business environment. That’s why it may be easier to purchase a shelf company instead. Shelf companies are perceived as more trustworthy vehicles for doing business in the country.
If you like, you may turn to business setup specialists like 3E Accounting for valuable business setup services for Indonesia. They can handle your corporate secretarial needs, as well as accounting, auditing, taxation and human resource functions, among other services. This may be just what you need to successfully set up your own business in Indonesia. Reach out to them for assistance.