Corporate Dissolution

Dissolving a Company is a legal process in which a company officially ends its operations and revoke its status as a legal entity. The process involves the settlement of all company liabilities, including the payment of debts, sale of assets, and distribution of remaining assets to shareholders. Dissolution can occur for various reasons, such as strategic decisions, financial issues, mergers, or acquisitions, and requires an orderly procedure in accordance with applicable legal regulations to ensure all rights and obligations of the company are properly settled.

BRIEF OVERVIEW

Based on the Company Law of Indonesia, specifically Article 142, a Company shall be dissolved and perform liquidation by appointed liquidator or receiver. During the liquidation process, the Company may not perform any legal act, unless required for the settlement of all the company’s matters in respect of the liquidation.

REASONS OF DISSOLUTION

Based on Shareholders Resolution

As stipulated in Article 142 (1) of Indonesian Company Law, dissolution may occur based on the Resolution of Shareholders through General Meeting of Shareholders (GMS). The GMS will be required to also appoint a liquidator or if it does not appoint a liquidator, the Board of Directors shall act as the liquidators.

Due to the Expiration Date of Incorporation

The dissolution of Company may also occur due to the expiry of its duration of establishment as set out under the articles of association as in accordance with Article 145 of Indonesian Company Law. Mandatory appointment of liquidator shall be set forth in the GMS Resolution within at least 30 (thirty) days after the expiration of the Company’s incorporation term.

Based on a Court Verdict/Order (Penetapan Pengadilan)

The District Court may dissolve a company at certain consideration, as set forth in Article 146 of Indonesian Company Law:

the request of the public prosecutor’s office on the grounds that the Company has violated the public interest or the Company has committed an act in breach of the laws and regulations;
the request of interested parties on the grounds that there are legal flaws in the Company’s
deed of establishment
the request of the shareholders, the Board of Directors or the Board of Commissioners on the grounds that the Company is not in a condition to continue its operations

In this condition, the District Court will appoint a liquidator stipulated in the Court Verdict/Order.

Due to Bankruptcy Status

A company may be dissolved through the revocation of its bankruptcy status through a commercial court order having permanent and binding legal force, the Company’s bankruptcy assets being insufficient to settle the bankruptcy costs or the assets of a Company declared bankrupt, are in a state of insolvency as set out under the Law on Bankruptcy and Postponement of Debt Payment Obligations (PKPU). The implementation of this condition is also considering Article 187 of Postponement of Debt Payment Obligations (PKPU) Law.

Upon dissolution due to bankruptcy status, the process shall be carried out with due observance of the provisions of the Law on Bankruptcy and Postponement of Debt Payment Obligations (PKPU).

Due to the Revocation of the Company's Business License

Due to the revocation of the Company’s business license, the Company is required to carry out its liquidation in accordance with the laws and regulations.

Steps & Requirements:

1.	Liquidator Appointment through either GMS Resolutions or Court Verdict/Oder
2.	Dissolution notification by the appointed liquidator through the national newspaper and State Gazette of the Republic of Indonesia
3.	Registering dissolution notification to the Ministry of Law and Human Rights
4.	Liquidation report submission to the Ministry of Law and Human Rights and the ratification of liquidation report
5.	Final liquidation report submission to Shareholders Meeting (GMS) or Court
6.	Acknowledgement of the dissolution status by the Ministry of Law and Human Rights
7.	Revocation request of any related business license
8.	Revocation request to the registered Tax Office and resolve HR-related matters

Why Choose Us?

Our team has extensive experience in providing Dissolution service, we provide comprehensive details to understand further responsibilities of a Liquidator - holding a very important role in Dissolution process, as we are prepared to assist in all aspects.

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