China Fortune Land Development: A Case Study

China Fortune Land Development: A Case Study

  • InCorp Editorial Team
  • 25 August 2023
  • 3 minute reading time

Problem

China Fortune Land Development Co Ltd (CFLD) is one of the leading industry city developers in China, based in Beijing, with an estimated net worth of more than US$4.1 billion.

In 2015 was, one of the planned CFLD projects in Indonesia, called the First International New Industrial City (NIC) project officially approved by the Indonesian government. As a result, CFLD is formally entering the Indonesian market to run the project.

Before they proceed with the entire approved investment, one of the CFLD’s initial steps is to establish 5 independent companies to run their activities in Indonesia, including all relevant licenses, permissions, and operation compliances related to their sector.

Solving and Solution

To set up a business in Indonesia, CFLD confirmed to establish 5 PMA companies in Indonesia through a 3-hour Investment Licensing Service (One-stop integration service program called PTSP) 

The licensing service will allow establishing a company in 3 hours with the requirement of a minimum investment of IDR 100 billion (US$ 7.33 million) and/or absorb a workforce of more than 1,000 people to have their preliminary permits. 

Except for company establishment, CFLD needs to obtain all licenses and permits to start their project in Indonesia. Also, the work permits for their management are based in Indonesia.

InCorp Indonesia Services Solution

CFLD appointed InCorp Indonesia (formerly Cekindo) as the principal consultant for their legal entity setup and compliance and engaged InCorp Indonesia to provide the following services in the initial stage:

  • 5 PMA company registration in Indonesia (complete company documents)
    • 5 Principle License
    • 5 Article of Association
    • 5 Deed of Establishment
    • 5 Domicile Letter
    • 5 Tax ID Registration
    • 5 Company Registration Certificate
    • 5 VAT payer application
  • Investment activity report (LKPM)
  • Company document revision
  • Company document translation
  • Land principal permit (IPR)
  • 16 work permit and visa (KITAS/ITAS)
  • 3 business visa
  • Payroll outsourcing
  • Employment report
  • BPJS social security and health program registration

Result and Impact

All 5 companies were successfully established, and the whole company registration process took only 3 hours (registration through a one-stop integrated service) with 2 weeks of document preparation before application. 

In the initial step, CFLD received eight preliminary permit documents, including a principal license, tax ID, work permits (RPTKA, deed of establishment, including the land-booking letter issued by the Ministry of Agrarian and Spatial Planning. And the rest of the documents follow in a short period.

“We start to cooperate with InCorp Indonesia after comparing several consultants; I found InCorp Indonesia is an international and professional organization with a good understanding of the local market. InCorp Indonesia helped our company to set up our first Indonesian entity and also helped with day-to-day operations. InCorp Indonesia showed a high level of professionalism. We see the biggest added value in fast starting the business in Indonesia, taking care of the routine process. Therefore, we can focus more on our core business.” Max Yang – President, Indonesia Region at China Fortune Land Development Co., Ltd.

Challenge and Cross Services

The process was carried out within a significantly shortened period of 3 hours of service and requested precise preparation and detailed knowledge of all individual laws.

Pandu Biasramadhan

Senior Consulting Manager at InCorp Indonesia

An expert for more than 10 years, Pandu Biasramadhan, has an extensive background in providing top-quality and comprehensive business solutions for enterprises in Indonesia and managing regional partnership channels across Southeast Asia.

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We do not act as an authorized government or non-government provider for official documents and services, which is issued by the Government of the Republic of Indonesia or its appointed officials.

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Frequent Asked Questions

As their names suggest, the main differences between the three business kinds in Indonesia lie in the businesses and the purpose of their incorporation. Local company owners (PT) must be Indonesian citizens, as even 1 percent of foreign ownership is not allowed. This type of company is not limited to entering any business field, and restrictions on incorporation are not so tight. On the contrary, a foreign-owned company (PT PMA) is open to international investors, but the maximal percentage of foreign shares differs in various business sectors. Contact InCorp to get the most updated information on the Negative Investment List. International investors tend to open representative offices as a first step to understanding the Indonesian market before setting up a limited liability company. This type is used for marketing and promotion activities and needs the right to sell directly and receive income.

Yes, this mainly applies to import and export businesses. Instead of establishing a company, you can use an under-name import service, an importer of record.

It should take between 30 to 45 days.