In Indonesia, company dissolution requires a liquidation process where assets and liabilities are settled without litigation. A designated liquidator can be represented by a legal consultant, a lawyer, or one of the Board of Directors (BoD) members.
The appointed liquidator holds the responsibility of announcing the company’s dissolution in the State Gazette of Indonesia and local newspaper agencies.
Common reasons for dissolving a company in Indonesia
- Expiration of the incorporation term.
- Expiration or revocation of the business license (such as a PT PMA or other operational license).
- Inactivity or non-operation of the company for the past three years.
- Non-compliance with Indonesian laws and regulations.
- Bankruptcy, resulting in the inability to repay creditors with the company’s assets.
Company Dissolution: The Timeline
The process of closing a company can take between 1 to 1.5 years to complete. According to Act Number 40 of 2007 concerning Limited Liability Company, the steps to dissolve a company are as follows:
| No | Legal Steps | Duration (Working Days) |
|---|---|---|
| 1 | Article of dissolution issued by the notary (step 1) | 5 |
| 2 | Newspaper publicity (1st) | 3 |
| 3 | Approval from the Ministry of Law and Human Rights | 60 |
| 4 | NIB and SIUP Revocation at OSS | 30 |
| 5 | Taxpayer Identification Number and Tax Certificate Registration (NPWP & SKT) Revocation | 180 |
| 6 | VAT Enterprise(s) (SPPKP) Revocation | 180 |
| 7 | Article of dissolution issued by the notary (step 2) | 5 |
| 8 | Newspaper publicity (2nd) | 3 |
| 9 | Approval from the Ministry of Law and Human Rights | 30 |
| 10 | Newspaper publicity (3rd) | 3 |
| TOTAL PERIOD (Results may be varied) | 1-1.5 years |
