II. FOREIGN TRADE REPRESENTATIVE OFFICE (KP3A)
Based on Article 1 point 29 of the Regulation of the Head of the Investment Coordinating Board Number Number 15 year 2015 on the Guidelines and Procedure of Licensing and Non-Licensing of Capital Investment that “Representative Office of Foreign Trading Company, hereinafter referred to as KP3A, is an office headed by an individual Indonesian Citizen or Foreign Citizen designated by a Foreign Company or
a Joint Foreign Company abroad as its representative in Indonesia. ” KP3A is opened in the provincial and district capitals throughout the territory of the Republic of Indonesia. When you want to set up company in Indonesia and start doing business in indonesia, you need to understand the rules and regulations in Indonesia.
1. Permissible Activities for KP3A
In accordance with Article 3 of Regulation of the Minister of Trade No. 10 / M DAG / PER / 3/2006, KP3A may undertake the following activities:
|a.||Introducing, promoting, and advancing the marketing of goods which produced by a foreign company or a consolidated foreign company overseas, and providing information or directions for usage and importation of goods to company or user in Indonesia,|
|b.||Conducting market research and monitoring sales in the country in the framework of the marketing of goods from a foreign company or consolidated foreign company,|
|c.||Conducting market research for the goods needed by a foreign company or a consolidated foreign company in the foreign country who appoints it and connecting and providing information and instructions about the terms of the export of goods,|
|d.||Engaging for and on behalf of the company which appoints it with the Indonesian company pertaining to the export activities.|
2. Prohibited Activities for KP3A
In Article 4 of Regulation of the Minister of Trade No. 10/2006 concerning Procedures for the Issuance of License of Foreign Trade Representative Office (“Permendag No. 10/2006”), a Foreign Trade Representative Office is prohibited from trading, transactions or sales activities that represent the entire transaction of beginning to end (eg, submission of tender documents, signing of contracts, and settlement of claims).
3. Business License
In the implementation of KP3A activities, must apply for a Business License of Foreign Trade Company Representative (SIUP3A) at PTSP Pusat in BKPM, consisting of:
Valid for 2 (two) months from the date of issuance,
Valid for 1 (one) year after the date of the issue,
It is applicable for a maximum of 3 (three) years unless specified less than 3 (three) years in the letter of appointment and may be renewed in accordance with the period applicable designation contained in the letter of appointment,
The procedures are the same as the temporary SIUP3A.
The procedure is the same as KPPA that is filing documents to BKPM.
|a.||The initial document for SIUP3A Temporary are:
1. Application Form,
2. Letter of Intent, Letter of Appointment, Letter of Statement, Letter of Reference (Original + Copy) must be legalized by Embassy of the Republic of Indonesia in the country of origin,
3. Representative Office Work Plan (for application for Temporary Business License for Foreign Trading Company Representative (SIUP3A) only),
4. Curriculum Vitae & Certificate of the Head of Representative Office,
5. Last Diploma Certificate,
6. Copy of valid Passport (Foreign Citizen) or copy of valid Identification Card (Indonesian Citizen),
7. Application signed by the company management, duly stamped and affixed with the company seal,
8. Original Power of Attorney duly stamped and affixed with the company seal, if the administration is not directly made by the company management, the original identity must be evidenced by attaching a copy of identification of the principal and proxy.
|b.||For applications for Permanent IUP3A, additional requirements are as follows:
1. Original Power of Attorney duly stamped and affixed with the company seal, if the administration is not directly made by the company management, the original identity must be evidenced by attaching a copy of identification of the principal and proxy,
2. Letter of Domicile from local Sub-District Office or Statement of office space from building management,
3. Original Approval of the Appointment of Foreign Trading Company Representative,
4. Copy of IMTA for the signatory of the head of the representative office who is a foreign citizen,
5. Domicile Permit from the chief village,
6. 2 sheets of 4×6 photos.
|c.||For applications for IUP3A extension, additional requirements are as follows:
1. Original Power of Attorney duly stamped and affixed with company seal, if the administration is not directly made by the company management, the original identity must be evidenced by attaching a copy of identification of the principal and proxy,
2. Copy of IMTA,
3. Statement on the Total Assistant Workers, Foreign Workers: Indonesian Workers = 1:3 (accompanied by a copy of Identification Card and payslip),
4. Copy of Company Registration Certificate (TDP),
5. Report on the Activities of the representative office,
6. 2 sheets of 4×6 photos.
|d.||Subsequently, the KPPA Permit shall be issued in the form of a Permit signed by the Head of BKPM or a designated official at the latest within 5 (five) working days of receipt of a complete and correct application with a copy to:
1. Minister of Finance,
2. Minister of Trade,
3. Minister of Manpower and Transmigration,
4. Head of Indonesian Representative in the country or origin of foreign company,
5. Governor or Regent or Major.
|e.||After the approval permit is obtained, the Company must report to PTSPPDPPM immediately to get direction and guidance in completing the licensing area, no later than 3 (three) months since the issuance of the Letter of Approval. The licensing areas include:
1. Certificate of Domicile of the Company,
2. Tax Payer Registration Number,
3. Taxable Confirmation Letter,
4. Company Registration Certificate,
5. And other required Licensing.
|f.||The obligation of Utilization of Indonesian Workers (TKI) in KP3A
According to Article 24 Paragraph (3), BKPM Regulation no. 15/2015 stipulates that KP3A must employ at least 3 (three) workers if KP3A hires TKA as KP3A’s Chief Representative.
Indo-Ned Consultancy will help you to set up Representative Office (KP3A) in Indonesia. We have helped our clients to set up Representative Office (KP3A), so we can help you to set up your business in Indonesia faster and legally.
Important to realize that the information provided here is based on our long experience. In addition, the process or requirement may vary depending on the specific facts and conditions. Besides, the law and regulations in Indonesia subject to frequent changes. In that case, please contact us as your consultant to get an up to date information and accurate advice. For furthermore information click here. At the same time, you can also follow our social media accounts to see the latest information posts. Therefore, please click on the following links: Facebook, Instagram, Linkedin, and Twitter.