Translated from Indonesian to English - www.onlinedoctranslator.

com

LEGAL FORM AND BUSINESS OWNERSHIP

(PROCEDURE FOR ESTABLISHMENT)

Used to fulfill the duties of lecturers in the Introductory Business course

Lecturer: Dian Palupi, SE, MSM

Arranged by :

HILDA PRASTIKA NOR AMALIA NPM 2210190434

INDONESIAN HIGH SCHOOL OF ECONOMIC SCIENCES

SURABAYA

2024
 FOREWARD

In the name of Allah SWT, the Most Gracious, the Most Merciful, we
offer praise and thanksgiving for His presence, who has bestowed His grace,
guidance and inayah upon us, so that I can complete the paper on Legal
Forms and Business Ownership (Tata Method of Establishment)

I have prepared this paper to the best of my ability and received assistance from

various parties so that I can make the writing of this paper smoother. For this reason,

we would like to express our thanks to all parties who have contributed to the

preparation of this paper.

Apart from all that, we are fully aware that there are still
shortcomings both in terms of sentence structure and grammar. Therefore,
with open arms, we accept all suggestions and criticism from readers so that
we can improve this scientific paper.

Finally, we hope that this legal form and business ownership paper
can provide benefits and inspiration to readers.

Surabaya, March 28 2024

Hilda Prastika NA

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 LIST OF CONTENTS

Table of Contents
FOREWARD.................................................. ................................................................ ............... i

LIST OF CONTENTS ................................................ ................................................................ ...............ii

CHAPTER I INTRODUCTION............................................... ................................................ 1

1.1 Background ............................................... ................................................ 1

1.2 Problem Formulation ........................................... .......................................... 2

1.3 Problem Objectives .................................................. ................................................ 2

CHAPTER II DISCUSSION ............................................... ................................................ 3

2.1 Individual Companies ................................................ ................................................ 3

2.2 Partner Companies (Firm & CV )................................................... ................................ 5

2.3 Cooperatives ................................................ ................................................................ .......... 11

2.4 Limited Liability Company............................................ ................................................ 12

2.5 Regional Companies .................................................. ................................................ 16

2.6 BUMN............................................ ................................................................ ............. 17

2.7 Forms of Collaborative Mergers ................................................. .... 20

2.8 Multinational Companies............................................ ................................ 22

2.9 International Companies ................................................ ................................ 22

CHAPTER III CLOSING ............................................... ................................................................ .. 24

3.1 Conclusion................................................ ................................................................ 24

BIBLIOGRAPHY................................................ ................................................................ .iii

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 PIG
INTRODUCTION
1.1 Background
In the world of business or entrepreneurship, there are different forms of business.

Currently there are several forms or business ownership that exist and are commonly known

among the public. There are things called Sole Proprietorship (Individual), Partnership (CV,

Firm, etc.), and Corporation (Limited Liability Company / PT).

Sole Proprietorship is a form of business whose ownership is owned by

an individual or alone. Some examples of companies in the form of sole
proprietorship are shops that we usually encounter in malls or on the side of the
road. This form of business is the simplest form of business because everything
is the responsibility of the owner himself and is usually not a legal entity. This
form of sole proprietorship business is also usually a family company where
there are not many regulations and other things

In contrast to sole proprietorship, a partnership form of business is usually

owned by two or more people. In Indonesia, we usually know it as CV or Firma.
Ownership of this business requires permission from the government and is usually
subject to law. Partnership business forms are divided into several types, some of
which are trading partnerships and limited partnerships. Examples of businesses in
the form of partnerships are Tata Motors, Daimler, Ford, etc.

Finally, there is the Corporation business form or what we usually know as a

Limited Liability Company (PT). A Limited Liability Company is a legal entity and its

ownership is usually in the form of shares that can be traded. Top Companies are also

divided into two parts, some are open and some are closed. The meaning of open is that

the ownership can be owned by parties outside the company, if it is closed, it means that

the ownership of the company is only owned by internal parties of the company. Some

examples of Limited Liability Companies are PT. Djarum, PT. Gudang Garam, PT.

Indofood, Tbk.

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1.2 Problem Formulation

1. What is meant by a Private Company?

2. What is meant by a Limited Liability Company?
3. What is meant by Sole Proprietorship?
4. What are the forms of collaboration?

1.3 Problem Objectives

1. To understand the process of establishing a company

2. To know the legal form and ownership of the business
3. To increase insight into the introductory business

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 CHAPTER II

DISCUSSION
2.1 Individual Companies
A sole proprietorship is a business owned by just 1 person. So the
owner of this company has unlimited responsibility and power over the
company and its assets. He bears all risks that occur to the company.

requirements for establishing a private company, there are at least three important

aspects that must be considered, including:

1. The first thing you must have as an entrepreneur is to find human and
natural resources that suit your business. The total amount of capital
must be calculated properly and correctly. Capital can be obtained from
personal pockets or savings, loans from relatives or friends, loans from
bank and non-bank financial institutions.
2. Second, you must prepare and keep books of accounts containing: The condition

and amount of assets owned by the company. Requirements required by the

Company Work agreements that occur either with the government or private

parties Incoming and outgoing letters, documents, correspondence. Company

financial reports per period (month, year, quarter. Archives of all letters,

activities and others.

3. Accuracy and compliance in paying taxes, there are several types of

taxes that must be paid, including: income tax (PPH), value added tax
on products, both goods and services, land and building tax and sales
tax on luxury goods.

These are some of the conditions that entrepreneurs must pay attention
to before setting up a private company. Next, we will discuss the procedures
for establishing a private company.

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 Registering to obtain the legality of an individual business can be done offline or
online. If you want to be more practical, you can register online. Prepare the
requirements to complete registration.

The requirement for founders is that they must be at least 17 years old. Founders

also need to be legally competent. The founder is an Indonesian citizen (WNI). So

foreigners cannot set up individual companies. Founders can only establish 1 company

within a year. Meanwhile, the document requirements are:

1. Resident Identity Card (KTP).

2. Taxpayer Identification Number (NPWP) of the founder. If not, register with the Tax

Office or via ereg.pajak.go.id.

3. PNBP Payment Voucher Number.

4. Company name (the company name must comply with the provisions of the laws and

regulations and must not be the same as the existing one).

5. Email is active.

6. Active cellphone number.

7. Proof of transfer of authorized capital to the company account (no later than 6 months from

registration).

The following is the procedure for registering an individual company online. Go to

the official AHU website online, via a browser go to the website ahu.go.id.

1. Select the business entity type menu. Select the Individual Company
menu. Register an account first.
2. Pay PNBP. Make payments for PNBP or Non-Tax State Revenue. The
payment amount is 50 thousand rupiah or in accordance with the
conditions stated when registering.
3. Fill in capital and personal data. Next, fill in the capital and personal
data. Personal data includes full name, date of birth, NIK, NPWP, and
email.
4. Login to PP establishment. Login to carry out the PP establishment process.

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 5. Fill in the Beneficial Owner. Fill in the beneficial owner. The beneficial owner is

the person who has the authority to appoint and dismiss commissioners,

directors, administrators, supervisors or supervisors in the company.

6. Submit and click Confirm Data. Submit then confirm the existing data.
7. Download the Statement of Incorporation. Download or download the founding statement.

If there are no problems regarding the company name and address, it

will immediately be online. In two days there will be a NPWP delivery for the
company. Next, you will receive a legality certificate that is valid for life as
long as the company does not commit any violations. After officially
registering for this individual company, you can continue by creating an NIB.
NIB is a Business Identification Number. To get an NIB, you can do licensing
online. This licensing is via the Online Single Submission (OSS)/Electronically
Integrated Business Licensing website at the address oss.go.id.

2.2 Partner Companies (Firm & CV)

Firma Company, the word Firma comes from the Dutch word
venootschap onder firm (VOF), namely a trade association between several
companies or often also called Fa, is a form of business entity for running a
business between two or more people (called Firmant) using a joint name or one
name that is used together to expand its business. Terms and Conditions for
Establishing a Firm include:

1. The minimum number of company founders is 2 (two) people or more

2. Choose a name that will be used by the firm

3. Have management appointed and determined by the founders. Who
will act as an active Persero, and who will act as a silent Persero.

4. Have specific aims and objectives (although of course you can include
the broadest aims and objectives) as well as business activities

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 which does not conflict with the regulations and laws in force in
Indonesia.
5. Have a place of business as the company's head office which is located in a
commercial environment such as an office building, shop, shophouse or
other business place designated as a place of business.

The following is the process of establishing a firm

Stage 1: Making the Deed of Establishment

Deed of Establishment of the Firm made and signed by an authorized Notary

and made in Indonesian, Requirements;

1. Photocopy of KTP of the founders of the Company

2. Data on the Firm's articles of association

Processing time; 1-2 (one-two) working days after the application is submitted and the requirements are

complete

Stage 2: Application for Company Domicile Certificate

Application for a certificate of company domicile is submitted to the Head of the local

Subdistrict Office according to the address where the company office is located, as proof of

the information/existence of the company address, other required requirements;

1. Photocopy of business premises contract/lease or proof of business premises ownership

2. Certificate from the building owner if you live in an office/shop

building.
3. Photocopy of PBB-land and building tax for the last year according to place of

business for companies domiciled in RUKO/RUKAN

Processing time; 2 working days after the application is submitted and the requirements are complete.

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Stage 3: Creating a Taxpayer Identification Number

Applications for registration of business entity taxpayers are submitted to the Head
of the Tax Service Office in accordance with the company's domicile to obtain;

1. NPWP card
2. Certificate of registration as a taxpayer

Condition;

1. Attach proof of VAT on building rental

2. Attach proof of payment of PBB-building tax
3. Attach proof of ownership or proof of lease/contract for business premises

Processing time; 2-3 working days after the application is submitted and the requirements are complete

Stage 4: Application for Taxable Entrepreneur Confirmation Letter (SP-PKP)

An application to be confirmed as a taxable entrepreneur is submitted to the Head of the Tax

Service Office in accordance with the NPWP that has been issued. Condition;

1. Attach proof of VAT on building rental

2. Attach proof of payment of PBB-building tax
3. Attach proof of ownership or proof of lease/contract for business premises

Process Time; 3-5 working days after the application is submitted and the requirements are complete

Stage 5: Registration with the District Court

This application is submitted to the local District Court Office according to the place
and position of the company. Other requirements required;

1. Attach NPWP - taxpayer identification number

2. Copy of the Firm's deed of establishment

Processing time; 1 working day after the application is submitted and the requirements are complete

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Stage 6: Application for Building Construction Permit (IMB)

The applicant submits an application to the regent through the Integrated Licensing
Services Office or the local Industry and Trade Service (DISPERINDAG).

1. Photocopy of KTP

2. Photocopy of land certificate or other land ownership confirmed by the Head of the

nearest Village or District Head

3. Detailed drawings of building construction

Processing time; maximum 14 working days after the application is submitted and the requirements are

complete

Stage 7: Application for Business Location Permit (SITU)

The applicant submits an application to the regent through the Integrated

Licensing Services Office or the local Industry and Trade Service (DISPERINDAG).
Condition:

1. Photocopy of KTP

2. Photocopy of land certificate

3. Photocopy of Building Construction Permit (IMB) 4. Color photo size 3×4 (lbr) and

4×6 (21br)

Processing time; maximum 14 working days after the application is submitted and the requirements are

complete

Stage 8: Application for Disturbance Permit (HO)

The applicant submits an application to the regent through the Integrated

Licensing Services Office or the local Industry and Trade Service (DISPERINDAG).
Condition:

1. Photocopy of KТР

2. Photocopy of land certificate

3. Photocopy of Building Construction Permit (IMB)

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 4. Color photos measuring 3×4 (lbr) and 4×6 (2lbr)

Processing time; maximum 14 working days after the application is submitted and the requirements are

complete

Stage 9: Application for Trading Business License (SIUP)

The SIUP application is submitted to the regent through the Integrated

Licensing Services Office or the local Industry and Trade Service
(DISPERINDAG). for medium and small SIUP groups, or the Provincial Trade
Service for large SIUPs according to the company's domicile. Other
requirements needed;

1. Photocopy of KTP

2. Photocopy of Business Location Permit (SITU)/ Disturbance Permit (HO)

for types of trading business activities that require a SITU based on
the Nuisance Law.
3. 2 (two) photos of the main director/head of the company (3x4).
4. Initial balance sheet

Process Time; 14 working days after the application is submitted and the requirements are

complete, except for large SIUP.

Stage 10: Application for Company Registration Certificate (TDP)

Applications for registration are submitted to the regent through the Integrated

Licensing Services Office or the local Industry and Trade Service (DISPERINDAG).

Companies that have been registered will be given a Company Registration Certificate

as proof that the Company/Business Entity has carried out the Compulsory Company

Registration in accordance with the Regulation of the Minister of Trade of the Republic

of Indonesia No.37/M-DAG/PER/9/2007 concerning Implementation of Company

Registration. needed;

1. Photocopy of KTP

2. Photocopy of Business Location Permit (SITU) / Nuisance Permit (HO)

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 3. Taxpayer Identification Number (NPWP)

4. 2 lbr stamp
5. Photocopy of Extension certificate (SP)

Process Time; 14 working days after the application is submitted and the requirements are complete

Additional stage to be able to participate in procurement/tenders in the field of construction services after

being declared legal

Especially for companies that want to take part in procurement/tenders in the Construction

Services sector, they must have;

1. Skills Certificate (SKA) or Skills Certificate (SKT) for experts

2. Member ID card of LPJK-accredited construction service company
associations such as AKAINDO, AKLINDO, APNATEL, GAPANSI,
GAPEKSINDO for contractors or INKINDO/PERKINDO for consultants
3. LPJK accredited Business Entity Certificate
4. IUJK (Construction Services Business License)

A limited partnership (CV) is a company established to run a company

formed by one or more people as jointly and severally responsible parties
(solidary) and one or more people as other parties entrusting their money.
How to set up a CV or limited partnership, namely:

1. Make a deed of establishment of CV at a notary. To make this deed, there are at

least 2 founders where one founder will be an active partner and the other

founder will be a passive partner.

2. Register the deed of establishment of the CV at the local District Court Registrar's Office.

3. Arrange for a Company Domicile Certificate ("SKDP") which can be processed

at the local sub-district according to your CV's domicile. To be able to apply
for SKDP, you need to first determine where your CV will be domiciled
according to the information in the CV's deed of establishment. You
4. Create a Corporate Taxpayer Identification Number (NPWP) which you can arrange at the

local Tax Office according to your CV domicile.

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 5. Next, you need to take care of a business permit that is appropriate to the

business sector run by the CV.

6. Finally, you need to take care of the Company Registration Certificate (TDP) document.

2.3 Cooperatives

Linguistically, cooperative comes from two English syllables, namely 'co' and

'operation'. Co means together, and operation means working. So it can be interpreted

that co-operation means doing work together (mutual cooperation). In terms of terms,

the definition of a cooperative is a business organization that has members, individuals

or legal entities, which is founded on the principles of kinship and economic democracy.

Cooperatives are an economic product whose activities are a people's economic

movement, and run on the principle of mutual cooperation. The way to set up a

cooperative is:

a) Basis of Formation
The things that need to be considered when forming a cooperative are as
follows:

• People who establish and wish to become members of a cooperative

must have the same economic activities or interests
• The business carried out by the cooperative must be economically feasible.

• Own capital must be available to support the business activities that will be

carried out, without ruling out the possibility of obtaining assistance, facilities

and loans from outside parties

• Management and management must be adjusted to the business activities to be

carried out in order to achieve efficiency in cooperative management.

b) Preparation for the Establishment of a Cooperative

After we know what things need to be considered in forming a cooperative,

we also need to know what preparations need to be made in establishing a
cooperative, here are the preparations:

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 • People who intend to establish a cooperative must first receive the broadest

possible information and counseling from the Cooperative Department Officials

in order to obtain understanding and clarity regarding the aims and objectives

of establishing a cooperative.

• Apart from that, it is best to carry out education and training first for
some or all of those interested in establishing a cooperative. Once they
feel they have sufficient understanding and foundation in their beliefs
and awareness, without any coercion or just joining in, they can hold a
formation meeting.

2.4 Limited Liability Company

A limited liability company (PT) (Dutch: Naamloze Vennootschap) is a

legal entity for running a business that has capital consisting of shares, the
owner of which has as many shares as the shares he owns. Because the
capital consists of shares that can be traded, changes in company ownership
can be carried out without the need to dissolve the company.

A limited liability company is a business entity and the amount of the

company's capital is stated in its articles of association. The company's assets are
separate from the personal assets of the company owner so that they have their
own assets. Each person can own more than one share which is proof of
company ownership. Shareholders have limited liability, namely as many shares
as they own. If the company's debt exceeds the company's assets, then the
excess debt is not the responsibility of the shareholders. If the company makes a
profit, the profit is distributed according to the stipulated provisions.
Shareholders will receive a share of profits called dividends, the amount of which
depends on the size of the profits obtained by the limited liability company.
Apart from coming from shares, PT capital can also come from bonds. The
advantage obtained by bond owners is that they earn interest

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regardless of the profits or losses of the limited liability company. The way to set up
a limited liability company is:

A. Founded by 2 (two) or more people

The main characteristic of a limited liability company implied in these terms is that a

limited liability company is an association or association that cannot be moved or

established by just one person. This is explicitly stated in Article 7 paragraph (1) of

Law no. 40 of 2007 concerning Limited Liability Companies. This requirement is

closely related to the basis for the formation of a Limited Liability Company, namely

the existence of a binding "agreement" between the founding parties who are

members of the limited liability company as intended under Article 1313 of the Civil

Code.

B. The Deed of Establishment is in the form of a Notarial Deed

In establishing a limited liability company, an authentic deed is required made

by a Notary based on the provisions of statutory regulations. The deed of
establishment made by a Notary is not only an absolute requirement for
establishing a limited liability company but also as evidence of the formation/
establishment of a limited liability company based on a valid and legally
enforceable agreement.
1. The things that need to be included in the deed of establishment include: Containing the

Articles of Association of the Limited Liability Company which have been agreed upon by

the founders;

2. In addition to the Articles of Association mentioned above, other information is also

required from the Limited Liability Company to be established, including, among

other things, the full name, place and date of birth, occupation, residence and

nationality of the individual founder, or the name, place of domicile and complete

address and number and the date of the Ministerial Decree regarding the

legalization of the legal entity of the company founder.

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 C.Every Founder is Required to Take Shares
The following conditions are determined by Law no. 40 of 2007 concerning Limited

Liability Companies states that when the founders appear before a Notary to have a

Deed of Establishment drawn up, each founder has already taken a share of the

Company's shares. This is because in Article 8 paragraph (1) letter c Law no. 40 of

2007 concerning Limited Liability Companies states that the Deed of Establishment

also contains the names of shareholders who have subscribed for shares, details of

the number of shares and the nominal value of shares that have been issued and

paid up. In this regard, the deed of establishment will be invalid if new shares are

taken by the founder of the company after the company is founded.

D. Obtain a decision to ratify legal entity status from the Minister.

Article 7 paragraph (4) Law no. 40 of 2007 concerning Limited Liability Companies

confirms: "a company obtains legal entity status on the date of issuance of a

Ministerial Decree regarding the legalization of the company's legal entity.

Ratification through a Ministerial Decree is a legal requirement that must be fulfilled

in addition to the other legal requirements mentioned above. As for The procedures

for applying for validation of legal entity status are regulated in Article 9 and Article

10 of Law No. 40 of 2007 concerning Limited Liability Companies, Chapter II of the

Minister of Law and Human Rights Regulation No. M-01-HT.01-10 2007.

Types of limited liability companies

1. PT is open
A public company is a limited company that sells its shares to the public
through the capital market (go public). So the shares are offered to the
public, bought and sold through the stock exchange. Examples of
PT.Terbuka are PT Telekomunikasi Indonesia (Persero) Tbk, PT Perusahaan
Gas Negara (Persero) Tbk, PT Bank Central Asia Tbk, and others.

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 2. Closed PT
A closed limited company is a limited company whose capital comes from
certain groups, for example the shareholders are only relatives and family or
people from a limited circle and are not sold to the public.
3. PT is empty

An empty limited liability company is a company that already has a business license and

other permits but has no activities.

Legal form of a limited liability company. The legal basis for the formation of a limited liability

company (PT) is as follows:

1. Law no. 40 of 2007 concerning limited liability companies

2. Law no. 8 of 1997 concerning Company documents.
3. Law no. 8 of 1995 concerning capital markets relating to the
establishment of Open PT
4. Government regulation no. 26 of 1998 concerning the use of limited liability company

names.

5. Government regulation number 27 of 1998 concerning the use of limited liability company

names

6. Decree of the Minister of Law and Human Rights of the Republic of Indonesia no. M-01.HT.01.01 of

2000 dated 4 October 2000 concerning the implementation of the legal entity administration system

and human rights of the Republic of Indonesia.

7. General Law Administration Decree No. C-1.HT.01.01 of 2001 concerning

Supporting Documents for Notarial Deed Filling Format (FIAN) model 1 and

Supporting Documents for Notarial Deed Filling Format (FIAN) model 11 for

certain limited liability companies.

8. Circular of the Director General of General Legal Administration, Department of Law and

Human Rights of the Republic of Indonesia No. C-1.HT.01.10-03 on March 8 2004

concerning the end of the manual system for applications for ratification of the deed of

establishment, approval and reporting of the deed of amendment to the Company's

articles of association

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9. Decree of the General Administration of General Laws of the Department of Law and Human

Rights of the Republic of Indonesia No. C-1.HT.01.01 in 2003 dated 22 January 2003 concerning

procedures for submitting applications and ratifying the deed of establishment and approving

the deed of amendment to the articles of association of limited liability companies.

2.5 Regional Companies

Regionally owned enterprises (BUMD) are companies founded and owned by the

regional government. The authority of regional governments to form and manage

BUMDs is confirmed in Government Regulation no. 25 of 2000 concerning

government authority and provincial authority as autonomous regions. How to set

up a regional company, namely:

1. The Regional Government establishes a Regional Regulation regarding the Establishment of PT XYZ. The things that need to be

regulated in the regional regulation are:

• The name of the PT and the alternative name of the PT, because it is very possible

that PT XYZ which will be registered with the Minister of Law and Human Rights has

already been registered by another party. If necessary, this is regulated further in

regional head regulations.

Composition of PT management, including full name, place and date of birth,

occupation, residence, nationality of members of the Board of Directors and

Board of Commissioners first appointed.

• the amount of authorized capital, issued capital and paid-up capital.

And other data & information required by the Notary.
2. Next, in front of a Notary, prepare the articles of association of the PT, then the Notary submits

them to the Minister of Law and Human Rights. If approved, there will be a deed of

establishment for the PT.

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3. After the PT has received approval from the Minister of Law and Human Rights, the

regional government will issue a regional regulation regarding capital participation

in PT XYZ. What needs to be emphasized is that the amount of capital participation

should be adjusted to the investment analysis prepared by the investment manager

assisted by an investment advisor. This is as regulated in Article 15-16 of

Permendagri 52/2012 concerning Guidelines for Regional Investment Management.

In the investment analysis, it will be seen how much capital is needed and how long

it will take to fulfill it. For example, capital of 25 billion is required which will be met

over 4 budget years.

4. Furthermore, based on the regional regulations regarding capital participation, the regional

government allocates capital participation in the APBD regional regulations for financing

expenditure.

2.6 BUMN
In general, the definition of State-Owned Enterprises (BUMN) is a business
entity whose capital is wholly or largely owned by the state through direct
participation originating from separated state assets (Based on Law of the
Republic of Indonesia No. 19 of 2003). How to set up a state-owned
enterprise (BUMN)

1. In Article 4 Paragraph (1) of the BUMN Law, it is stated that a Persero's capital

comes from separated State money/wealth. In the legal concept of a company,

the separation of state assets which are then included in the company's capital is

called capital participation.

2. In the concept of public law/administrative law, participation in state capital is the

separation of state assets. For this reason, administrative procedures are

required in accordance with the rules for managing state assets. Based on the

provisions of Article 1 number 7 PP No. 44 of 2005 concerning Procedures for

Participation and Administration of State Capital in BUMN and Limited Liability

Companies, that "State Capital Inclusion is the separation of state assets from

the State Expenditure and Revenue Budget or the determination of reserves

17
 companies or other sources to be used as capital for BUMN and/or other
Limited Liability Companies, and managed corporately."
3. Furthermore, in Article 4 PP no. 44 of 2005 determines that every contribution from the

APBN is carried out in accordance with the provisions in the state finance sector. Based

on the provisions of Article 4 Paragraph (3) of the BUMN Law, participation from the

APBN must use Government Regulations (PP). For state participation that does not come

from the APBN, in the explanation of Article 4 Paragraph (5) of the BUMN Law, it is

emphasized that this can be done by decision of the GMS or the Minister of State for

BUMN and reported to the Minister of Finance.

4. Capital participation based on Article 5 PP No. 44 of 2005 can be carried out by the state,

among others, in terms of (a). establishment of a BUMN or Limited Liability Company. The

establishment of a Persero is part of capital participation. Before an "inclusion" becomes

Persero's capital, it is necessary to carry out an in-depth study regarding the importance

of the "inclusion". This study was carried out by 3 (three) ministers, namely the Minister of

Finance, Minister of State-Owned Enterprises and Minister of Engineering. In detail, the

"participation" procedure is regulated by Article 10 Paragraph (1) to Paragraph (4) PP

Number 44 of 2005 concerning Procedures for Participation and Administration of State

Capital in BUMN and Limited Liability Companies.

5. The next process is regulated in Article 12 of Government Regulation Number 44 of 2005, which

states that based on a proper study, the President issues a Government Regulation (PP)

concerning the Establishment of a Limited Liability Company, which contains the

establishment, aims and objectives, and the amount of assets separated for capital.

Forms of BUMN:

BUMN in Indonesia is in the form of limited liability companies, public companies and

government companies

1. Limited company
A limited liability company (Persero) is a state-owned company in the form of a

limited liability company whose capital is divided into shares of all or at least

18
 51% of the shares are owned by the government (on behalf of the state) whose

main goal is to pursue profits.

The characteristics of the company are as follows:

• The establishment of a company is proposed by the minister to the president

• The implementation of the establishment is carried out by the minister taking into account

the laws and regulations

• Its status is in the form of a limited liability company regulated by

law
• The capital is in the form of shares

• Part or all of the capital belongs to the state from separated

state assets
2. Public company
A public company (perum) is a BUMN whose entire capital is owned by the
state and is not divided into shares, which aims for public benefit in the form
of providing high quality goods and/or services and at the same time
pursuing profits based on company management principles.
Housing characteristics:

• Serving the interests of the general public.

• Led by a board of directors/director.

• Has his own wealth and operates in a private company. This

means that public companies (PERUM) are free to make work
contracts with all parties.
• Managed with government capital which is separate from state assets.

3. Service companies
Service companies (perjan) as a form of BUMN have capital originating from
the state. Currently, TVRI is the only agreement owned by BUMN. The
amount of contract capital is determined through the APBN. The
characteristics of the agreement include the following:

• Providing services to the community

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 • Is part of a government department
• Led by a head who reports directly to the minister or director
general of the department concerned
• The employee's status is a civil servant

2.7 Forms of Collaborative Merger

A merger is a process of diffusion or merging of two companies with one of
them continuing to exist with its company name while the other disappears with
all its name and assets being included in the company that remains standing.
Mergers are divided into three, namely:

1. Horizontal mergers are mergers carried out by similar businesses (the same business), for

example a merger between two bakery companies, a shoe company.

2. Vertical mergers, are mergers that occur between companies that are related
to each other, for example in a sequential production flow. For example: a
yarn spinning company merges with a cloth company, a tire company
merges with a car company.
3. Conglomerate is a merger between various companies that produce
different and unrelated products, for example a shoe company
merging with an electronics company or a car company merging with
a food company. The main goal of a conglomerate is to achieve rapid
growth of the business entity and get better results. The way to do
this is by exchanging shares between the two companies that are
united.
4. Generic Con Mergers Generic con mergers are mergers between two or
more related companies, but not for the same product. Example of a
merger between a bank and a leasing company

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Consolidation

Consolidation, which comes from the word "consolidation", which means

"merging", is a legal act carried out by 2 (two) or more companies to merge
themselves by establishing a new company which, by law, acquires the assets
and liabilities of the merging companies, Apart from that, the status of the legal
entity of the merging company ends due to law.

Consolidation or what is also known as company amalgamation, is a

legal act carried out by one or more companies to merge themselves with
another company by forming a new company, each of which merges itself
into dissolution (without a liquidation process), so that the company- a
company that has dissolved itself forms a new company. In short,
consolidation is a merger of companies that merge into one and form a new
company. Joint Venture According to Engga Prayogi, a Joint Venture is an
agreement between two or more parties to collaborate in an activity. The
agreement in question is an agreement on an agreement that adheres to the
principles of the Civil Code. Approval must meet the requirements and be
valid according to the Civil Code as stated in Article 1320. Article 1320 reads
as follows:

1. The parties agree to bind themselves;

2. The parties are competent to carry out a legal action;
3. The legal act must concern a certain matter;
4. The agreement must concern something that does not conflict with
law, morality and public order.

Franchise

Franchise (English: Franchising, French: Franchise) for honesty or

freedom is the right to sell a product or service. Meanwhile, according to the
Indonesian government's version, what is meant by franchise is an
agreement where one party is given the right to use or use it

21
using intellectual property rights (IPR) or a combination of business
characteristics owned by another party with a reward based on the
requirements set by the other party in the context of providing and/or selling
goods and services.

Franchises can be divided into two:

1. Overseas franchises tend to be preferred because the system is clearer, the brand has been

accepted throughout the world, and is felt to be more prestigious.

2. Domestic franchises are also an investment option for people who want to
quickly become entrepreneurs but do not have sufficient knowledge of the
tools for starting and continuing this business provided by the franchise
owner.

2.8 Multinational Companies

Multinational companies or PMNs are companies that operate in

many countries; These companies are usually very large. Companies like
this have offices, factories or branch offices in many countries. They
usually have a central office where they coordinate global management.
Very large multinational companies have funds that pass through the
funds of many countries. They can have a strong influence in global
politics, due to their enormous economic influence as politicians, as well
as ample financial resources for public relations and political lobbying.

2.9 International Companies

An international company is an organization that has business operations

in several markets around the world. This company may have its
headquarters in one place, but it has branch offices in every country.
There are many reasons why a company would choose to trade
internationally apart from simple market expansion. International
companies can take advantage of loopholes in local tax laws to transfer

22
profits from one country to another and thus avoid paying taxes or being
taxed at very low rates. How to establish an international company.
Submit a Temporary Permit for the establishment of a Foreign
Investment Limited Liability Company (PT PMA) through BPKM by first
paying attention to Presidential Decree No. 36 of 2010 to find out
whether the PT PMA business sector is open to foreign investment, and if
open -- how large the composition of foreign investment is permitted. To
establish a PT PMA, you must first submit an application to BKPM for
investment registration, namely by filling in the application formula
specified in Appendix I of Perka BKPM No. 12 of 2009,

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 CHAPTER III

CLOSING
3.1 Conclusion
When an entrepreneur has decided to launch his business, one of the
initial problems he faces is choosing the form of ownership. Often
entrepreneurs do not spend much time choosing and evaluating the
impact of various types of ownership on themselves and their own
businesses. They only choose what can be used for their business within
that time. Entrepreneurs must choose a form of ownership that has a
long term for the entrepreneur and his business. The many events that
occur in changing a business from one form of ownership to another will
trigger various tax consequences that will be burdensome for the
owners.

Therefore, entrepreneurs must act properly and correctly from the

start of starting a business. Choosing a good and correct form of
ownership means that entrepreneurs must also be able to understand
these characteristics according to their business and personality. Only in
this way can an entrepreneur make wise decisions regarding ownership.

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 BIBLIOGRAPHY

Nature s, economics 2. (esis : Erlangga, 2007) p.197

Freddy Rangkuti, Business techniques for making business plans and case analysis,

(Jakarta: Pt Gramedia Primary Library, 2005) p, 12

http://www.articlesiana.com/2014/11/jen-jen-usaha.html accessed on 27-.

3-2017 at 10.30 WIB

M. Arrif, SE I, MA, Creating a company is easy, (Jakarta member of IKAPI, 2009) p.5

iii