How to Choose a Company Name In Indonesia PMDN & PMA – In doing business, the company name is one of your most valuable assets. An effective company name is one that builds a strong identity and describes the type of business you are running.
It’s not uncommon for companies to experience one or more changes to names companies as they grow. Because a name change can reflect the business you are running.
Choosing a name for a company can be the first step in developing a new identity for the business and building a new image. The first impression the public will have about your growing company (at this time) is getting a good business name or being better known by the public. A good name is very important to create a memorable business image.
Below we will explain the procedures for choosing a company name, both (local and foreign company/PMDN-PMA) in Indonesia, based on applicable regulations.
Before going any further explanation.
What is the Company Name?
A company name is a phrase used on legal papers and other forms when dealing with a company as a legal person or entity. Company name or legal entity name often appears on documents such as company legal documents, legal contracts or bank statements etc. The company name can be used for all commercial transactions as well as brands that are applied in marketing.
How to Choose a Company Name for a Local PT and PMA (Foreign Company) in Indonesia?
Regulations regarding the procedure for the use of names in the company are based on Article 16 of Law no. 40 of 2007 concerning Limited Liability Companies is further regulated in a Government Regulation.
The guidelines for choosing a PT name are detailed in Government Regulation No. 43 of 2011 concerning Procedures for Submission and Usage of Names (PP 43/2011).
1. Regarding the use of a name in a company, if the company is owned by an Indonesian citizen or an Indonesian legal entity, it is mandatory to use the Indonesian language.
This is regulated in Article 11 PP 43/2011, which reads:
Companies whose shares are wholly owned by Indonesian citizens or Indonesian legal entities are required to use the Company Name in Indonesian. Assuming that the company you wish to register is a company owned by an Indonesian citizen or an Indonesian legal entity, the use of the name for the company must be in Indonesian.
2. Article 5 PP 43/2011
- Written in Latin letters & The company name cannot be the same as the name of another company that has been established.
- The company name must consist of at least 3 Indonesian words.
- The company name must not conflict with public order or morality.
- Not the same or not similar to the names of state institutions, government agencies, or international institutions, unless they have permission from the institutions concerned.
- Does not consist of numbers or a series of numbers, letters or a series of letters that do not form a word.
- Has no meaning as a company, legal entity, or civil partnership.
- Not only using the purposes and objectives and business activities as the name of the company and
- The company name must be in accordance with the objectives or line of business of the company.
3. In the event that the proposed Company Name is accompanied by an abbreviation, the use of the abbreviation must meet the requirements as referred to in paragraph (1) except letter e.
4. The abbreviation for the Company’s name as referred to in paragraph (2) is in the form of:
- An abbreviation consisting of the first letter of the Company’s Name; or
- Abbreviation which is an acronym for the Company Name.
Almost the same as the local PT / PMDN which distinguishes it
- You can still use the English name if you are a foreign company or a PT PMA. It doesn’t matter if the PT PMA is only partially owned or fully owned by foreign parties. Apart from English, PT PMA can also be named in other languages.
The issuance of this regulation aims to provide legal protection to name users who have good intentions to use this name as the official name of the PT in the company’s deed of establishment. And therefore, the name PT cannot be made arbitrarily and there are several things that must be considered.
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