When you want to establish a business entity, especially a Limited Liability Company (PT), you need to have a company deed of establishment. This deed of establishment is often made by large companies, especially those whose business is related to the government. However, the importance of making a deed of establishment will depend on the needs of the company, so it is possible that small companies also need to make one. In practice, this deed of establishment must be made at a notary office. This is in accordance with Article 1 of Law No. 30 of 2004 which states that a notary is a public official authorized to make authentic deeds and other authorities as stated in the Notary Position Law. So, what is a company establishment deed and what is its importance? Check out the full explanation in the following article!
What is a company deed of establishment?
Before going any further, you need to know what a company deed of establishment is. A company establishment deed is a document that is notarized to establish a company, either a small company like a CV or a large company like a PT. This document can also be used to create a foundation or other commercial institutions. The company establishment deed contains the identity of the founders along with their photos and addresses, the agreements made when establishing the company, and the company’s articles of association. Not only that, the deed of establishment also needs to explain the objectives that the company wants to achieve. That way, when problems occur in the future or the goal has deviated far from the original intention of establishing the business, the founders can look back at the deed to focus on the original goal. It should also be noted that all matters recorded in the company’s deed of establishment need to be legalized by the Ministry of Law and Human Rights in order to obtain legal entity status. That way, this company deed can be used to conduct transactions with all parties, both government agencies and large-scale private institutions that have legal entities.
What business entities require a company deed of establishment?
As mentioned earlier, a company deed of establishment is one of the important documents that every company founder must have. So, what types of business entities must have a company deed of establishment? Here is the explanation.
Limited Liability Company (PT)
PT is a legal entity in the form of a capital partnership and is established based on an agreement to conduct business activities. The capital in a PT is divided into shares and must fulfill the requirements set by law. PT share capital can also be sold to other parties. So, there can be changes in the organization or ownership of the company without the need to dissolve and re-establish it.
Firm
A firm is a form of partnership between two or more people to run a business entity under a common name. Usually, the deed of establishment of a firm contains:
- Firm name
- Contribution of each founder
- Business profit sharing mechanism
- Parties appointed as administrators
- Firm dissolution issues
Individual Company
As the name suggests, an individual company is a company owned by a private party or individual. This company is the simplest business entity with small capital and has limited production capabilities.
Limited liability partnership (CV)
A CV is a company built by two or more people, one of whom is only a capital provider (passive ally) and the other is in charge of managing the company with the capital (active ally).
READ ALSO: About Changes in CV Articles of Association Deed that Must Be Known
The company deed of establishment for a CV usually contains the following:
- Duties and responsibilities of each founder
- Profit sharing
- Determination of management
- Dissolution of CV
What is the Importance of Having a Company Deed of Establishment?
As explained earlier, companies whether incorporated or not are required to have a company deed of establishment. But in practice, not all business actors have a company deed of establishment, even though this document is very important and needed when you want to manage a business. Here are some of the functions and benefits of having a company deed of establishment:
Legal Status in the Eyes of the Law
By having a company deed of establishment, the legal status of your company will change. That way, when a dispute occurs during the course of business, this deed of establishment will be the handle that can benefit the company while clarifying your position as a business actor.
Supporting Documents for Licensing
With a company deed of establishment, it is easier for you to apply for other licenses such as NIB, NPWP, and other licenses. Not only that, it is also easier when you want to take care of export licenses in the context of business development abroad.
Provide Clarity of Ownership Status
The company deed of establishment also helps to avoid unwanted things during business activities. For example, when buying or selling shares, the deed of establishment will help clarify the legal status of ownership.
Procedure for Making Company Establishment Deed
When you want to make a company deed of establishment, there are several requirements that need to be met such as:
- Name and place of business
- Company address
- Purpose and objectives and business activities
- Time period of company establishment
- Articles of association of the company, including the amount of authorized capital, issued capital, and paid-up capital (PT only)
- Nominal value and number of shares (PT only)
- Personal data of the founders as well as directors and shareholders which includes full name, place of birth, occupation, residential address, NIK, and NPWP.
READ ALSO: Knowing Authentic Deed and its Usefulness in Business
After all documents are completed, the notary will submit the company’s deed of establishment to the Ministry of Law and Human Rights. If approved, the Ministry of Law and Human Rights will issue the Certificate of Establishment electronically.
KH Contact
For KH pals who want to take care of making a company establishment deed, you can contact Kontrak Hukum. We can help you to make a company establishment deed, including changes such as KBLI adjustments, changes in commissioner directors, shares, authorized capital, and other changes to the deed. No need to worry, because the management is handled by a team of experienced professionals with affordable prices. To view the services, visit the KH Services – Digital Notary page. If you have questions about other company needs, you can also consult for free at Ask KH or via direct message (DM) to Instagram @kontrakhukum.
