How to Establish an Indonesian Association in the Form of a Legal Entity

In Indonesia, an association is an organisation where individuals, companies, professionals, and groups come together to realise common goals and objectives for non-profit matters. Members of the association partner to realise social, religious, and humanitarian goals that will make a difference to the world.

Indonesian Association: Establishment Purposes

Individuals or organisations set up associations in Indonesia with the below purposes:

1. To spread and disseminate information within the association quickly and efficiently through different media and platforms. For example, the association of environmental clean-up can circulate their news and updates about beach clean-ups rapidly to increase participation.
2. To network with members and professionals in the association. Through networking, members and organisations can build and foster better relationships, motivating them to achieve the association’s goals.
3. To have a valuable support system. Members of an association can provide mutual support due to their same interest in a particular field or goal.
4. To help others outside the association.

Indonesian Association: Available Types

There are two types of Indonesian association: non-legal entity association and legal entity association. However, the most common type of association in Indonesia is built in the form of a legal entity.

When an association is established as a legal entity, a group of individuals works together to achieve certain objectives and goals in the religious, social, and humanitarian areas. Members of the association do not have any legal rights to share the profits of the association.

How to Incorporate an Association in Indonesia

To establish a legal association in Indonesia, you should get permission from the Indonesian Minister of Law and Human Rights.

The process of incorporating an association in Indonesia is as follows:

1. Request a Name for Your Association

Apply and submit the name of your association to the Ministry of Law and Human Rights by using the AHU Online system. Your application shall contain all the important information. It takes about 60 days for the Minister to approve your application.

2. Apply for Association Legalisation as a Legal Entity

The applicant is also a notary who is authorised to apply for association legalisation as a legal entity via AHU Online. The payment of the application fee IDR 250,000 is mandatory.

3. Obtain a Ministerial Decree Regarding the Association Legalisation as a Legal Entity

The applicant shall submit the establishment format with required supporting documents electronically. These documents consist of the following:

• A copy of the deed of establishment or a copy of the deed of amendment
• A statement of residency location with the association’s full address
• Funding source
• Work program of the association
• Meeting minutes
• Declaration letter not in a court case or a management dispute
• Statement concerning the founder’s ability to acquire a tax ID card

4. Upload the association’s deed of establishment

5. Receive the Ministerial Decree

Once the Minister has approved the application, the applicant shall receive a Ministerial Decree electronically in 14 days. The applicant also must print out and sign the Ministerial Decree and the Notary Public shall affix the hard copy with a stamp.

How Cekindo can Assist

Cekindo can assist in establishing an efficient Indonesian association for businesses, expatriates, entrepreneurs, and individuals. Our experienced expert team will set up and customise the association structure that meets your specific business objectives.

However, it is important to have a full understanding of the most current regulations and legal requirements in Indonesia before going ahead to set up your Indonesian association.

Your decision can hamper the growth of your association if you make the wrong move. Consider seeking Cekindo’s advice before taking the first step. Fill in the form below.