Limited Liability Company

A.           Regulations

A Limited Liability Company shall be governed by this Law, the Company’s articles of association, and other prevailing laws and regulations[1].

Thus, there are three kinds of regulations that govern the company. The first is Company Law. Second is Articles of Association. And third is other Prevailing Laws and Regulations. And this last kind is the most type. We can found Laws and regulations in all sectors relating to the Company actifity. Let's just say, when the Company will conduct its business, like making the contract with other subject of law, there are rules about engagement as Civil Law Books (KUHPerdata/BW), etc.. In cooperation, such as BOT, JVA, etc. there are any own rules. To pay taxes there are also related with the Company Tax Regulations, as well as in the Company's relationship with Labour, Workers, Investors, Environment, Government, and others.

B.            Definition

A Limited Liability Company, hereinafter referred to as a Company, is a legal entity constituting a capital association, established by virtue of an agreement, conducting business activities with authorized capital entirely divided into shares and complying with the requirements  provided in this Law and its implementing regulations.[2]

Therefore the requirements to establishment of Limited Liability Company based on the definition above is:
  1. A legal entity.
  2. Capital Association, meaning established by more than one person.
  3. Agreement. This is contained in the Deed of Established of the Limited Liability Company.
  4. Authorized Capital. we will see about this in the next article.
  5. All of the Capital Base of Company's is divided into shares.
  6. Comply with the requirements of the Company Act (40/2007) and other related regulations.

With this definition, the question that may arise is, whether only after the specified requirements are met by definition above, can be said to be a Limited Liability Corporation?. And of course yes. But of the six elements is requirements to establishment of Limited Liability Company in the definition above, the sixth element was that so many of its provisions must be met and we can found in every sector of company activity. So if it is just a legal entity, established with more than one person, have Deed of Established, and the Authorized Capital in Stock, then it can not be said as a Limited Liability Company, many other terms contained in the Company Law No. 40 of 2007, and other related regulations.



Regards
Jun

[1] Article 4, Law No. 40 of 2007 Regarding Limited Leability Companies.
[2] Ibid, Article 1 Point (1).

Other Reference
Civil Law Books (KUHPerdata / BW)

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