Comply With the List and Start Trading Activities With Ease

How to Start a Trading Company in Indonesia

Modern-day Indonesia is now more open to the world outside. Further bilateral trade agreements with other countries have made Indonesia more accessible. Business owners from everywhere have potential products for sale in Indonesia. Hence, many of them are studying how to start a trading company in Indonesia.

 

From Micro to Large

When two companies need each other’s’ product or services, they could acquire it directly. But if they are in different countries, it would be through a trading company. Make no mistake that not all trading companies are significant. In Indonesia, there are various sizes of a trading company based on the trading license they possess. Trading companies need a permit to start their trading business, and it begins with a Surat Izin Usaha Perdagangan (SIUP). There are currently 4 SIUPs available to obtain, depending on the business size.

  • Micro SIUP license – business net worth of fewer than 50 million rupiahs.
  • Small SIUP license – net worth between 50 million and 500 million rupiahs.
  • Medium SIUP license – net worth between 500 million and 10 billion rupiah
  • Large SIUP license – net worth of more than 10 billion rupiahs.

All of these net worth does not include land and buildings.

 

One Step at a Time

Next, comes the process of how to start a trading company in Indonesia. Start with a checklist of the things needed to register a trading company. The basics could be similar to your home country. But, importing products into Indonesia is an experience altogether. Do note that if you have specific products, get in touch with us and we shall advise you further. Now, let’s get to that checklist.

 

Company Registration Process: Get These Ready

  • Articles of Association issued by a Notary Public
  • License from Investment Coordination Board Principle – the approving investment body in Indonesia
  • Permission from Minister of Justice – most likely written form
  • A domicile letter from local government – depending on the location of your company office
  • Tax registry number (NPWP), Tax Card and TDP (business registry to local trade department)

 

Permanent Business Permit: Now This Needs

  • Notary Deed of Establishment
  • License from Investment Coordination Board Principle
  • Copy of office and warehouse agreement
  • A written statement of the location of your head office – get a virtual office if none exist. Talk to us if you have issues.

These documents are needed to apply for an API-U (General Importer Identification Number) or API-P (Producer-Importer Identification Number) from the Investment Coordinating Board. Without it, there is no way trading companies can import products.

 

The Do’s and Don’ts

Indonesia has a negative investment list for foreign-owned trading companies. The Indonesian government came up with the list to protect core businesses in Indonesia. It is a list of businesses that bans foreign investment. Hence, foreigners can only trade within granted sectors. With that in mind, trading companies must obtain customs identification numbers issued by the Directorate General of Customs and Excise (DGCE). This is compliant with customs regulations in Indonesia. The number remains valid for as long as the company engages in usual business activities. Trading companies in Indonesia are only allowed to conduct one type of business activity. If you plan to start another business activity, you have to apply for another license specific to the sector or product type.

How to Start a Trading Company in Indonesia