ARTICLE
12 November 2020

Establishing A Business In Indonesia – Shareholders And Voting Rights

S
SSEK Law Firm

Contributor

SSEK Law Firm logo
SSEK Legal Consultants was formed in 1992 and today is one of the largest corporate law firms in Indonesia. SSEK offers the full suite of corporate and commercial services across a range of practice areas. We have the experience and expertise to handle the largest, most complex cross-border transactions and projects in Indonesia.
Protections for shareholders and/or minority shareholders under the Indonesian Company Law are as follows.
Indonesia Corporate/Commercial Law

Protections for shareholders and/or minority shareholders under the Indonesian Company Law are as follows:

  • A shareholder can file a claim at the district court against the company if they suffer unfair and unreasonable losses as a consequence of resolutions of the general meeting of shareholders (GMS), board of directors (BOD), or board of commissioners (BOC).
  • A shareholder can request the company to purchase its shares at a reasonable price if that shareholder disapproves of the company's actions that cause losses to shareholders or the company. Such actions can take the form of:
    • amendments to the articles of association;
    • a transfer or pledge of the company's assets valued at more than 50% of the company's net assets; or
    • a merger, consolidation or acquisition of the company.
  • Shareholders representing at least one-tenth of the total shares with voting rights can file a claim with the district court on behalf of the company against any member of the BOD and BOC who, because of his/her mistakes or negligence, has caused losses to the company.
  • One or more shareholders representing at least one-tenth of the total shares with voting rights can submit a proposal for the dissolution of the company to the GMS.

There are no restrictions on granting additional protections to minority shareholders, but it is uncommon to grant such additional protections. 

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Mondaq uses cookies on this website. By using our website you agree to our use of cookies as set out in our Privacy Policy.

Learn More