Category: Legal Articles

The Structure of The Legal Opinion (LO)

Posted by Dr. Guan Yue on

So far, Queen Law Firm has issued Legal Opinions for many companies around the world, including online games, mining, tourism, transportation, virtual currency, real estate development, international trade, medical equipment, company listing, new energy, high-speed rail, securities, etc. for many industries and uses. Today, Queen Law Firm would like to summarize the composition of a Legal Opinion, so enterprises and individuals interested in Legal Opinion can better understand the professionalism and importance of Legal Opinion.

A Legal Opinion is a professional legal document that gives detailed legal answers to one or more issues on the basis of studying existing laws and regulations. The role of Legal Opinion is very important. It can ensure that enterprises avoid possible legal risks when conducting certain commercial activities, and obtain the maximum profit at the minimum cost within the scope permitted by law. Legal Opinions are generally divided into the following five parts:

  1. Legal Basis
    This part lists the current laws and regulations that will be used in the Legal Opinion. Because all opinions in the Legal Opinion will be given based on these laws and regulations.
  2. Chronology of Facts
    This part is a statement of some facts, such as the basic situation of the client, the legality of the documents and materials submitted by the client, and so on.
  3. Problem Identification
    This part will list the questions that the Legal Opinion will answer.
  4. Legal Opinion
    This part will provide legal professionals and detailed answers to the questions raised by the client in accordance with applicable laws and regulations, and give corresponding suggestions. In this part, there will be a rigorous legal logic system. By analyzing various legal articles related to the issue, the rationality and legality of the legal opinion will be determined. For individual types of Legal Opinions, there will also be case analysis, government policy research, etc.
  5. Conclusion
    In this part, the answers to the questions will be listed again in a summary manner, so that client can refer to them in later operations.

It can be seen that a good Legal Opinion has a rigorous system. Because a good Legal Opinion must be able to maximize the protection of the interests of the client. It can be said that a good Legal Opinion is the compass for the enterprise in the process of implementing the plan.

Requirements for Letter of No Objection to Marriage

Posted by Dr. Guan Yue on

Chinese citizens domiciled in Indonesia and Indonesian citizens have registered their marriage with the Indonesian population department. At the request of the Indonesian population department, Chinese nationals can apply for a “Letter of No Objection to Marriage”. To apply for a marriage certificate without objections, you will need to prepare the following materials:

  1. Original and copy of foreigner’s passport;
  2. Foreigners at the domestic notary office issue a “notarization of unmarried information” and to the Consular Department of the Ministry of Foreign Affairs or local foreign offices, Indonesian embassies and consulates in China to carry out “double certification”;
  3. Original and copy of Kitas Foreigner;
  4. Foreign companies working in Indonesia issue evidence that they work in Indonesia;
  5. Proof of entering a foreigner’s religion (depending on the religion of the Indonesian citizen);
  6. Original passport and copy of Indonesian passport;
  7. Original evidence from single letter of Indonesian citizen (civil registration/KUA);
  8. The original household registration card (KK) and a copy of the Indonesian citizen;
  9. Each is handwritten in one copy at the time of introduction and signed and dated (Contents: time, when and where to get acquainted, how to get acquainted, duration of communication between the two parties, language of communication between the two parties, whether you have met each other’s family members others, do you know each other’s family situation, whether the Indonesian citizen concerned has ever visited China, do you intend to stay in Indonesia after marriage, etc.);
  10. 3 photos together (better if you can attach a photo of the meeting with parents).

*Embassies and Consulates will not issue a “Letter of No Objection to Marriage” for Chinese nationals who come to Indonesia temporarily or for a short period of time.

*After the initial inspection, the Embassy may ask you to provide other relevant supporting materials according to your situation.

The Role and Function of Retainer

Posted by Dr. Guan Yue on

The term retainer may be foreign to most people, so there are still many people who question whether it is a retainer? The retainer is a legal relationship between a lawyer and his client where the legal relationship is continuous and continuous in general, the legal relationship is carried out for a minimum of one year, so it can be said that the Retainer is a Permanent Legal Counsel.

Basically, Retainers can be used by companies or individuals before a legal problem occurs or after a legal problem occurs, with the function of protecting the company so that legal problems do not occur.

The function of the retainer for the company is as a legal consultant who can handle litigation and non-litigation cases including:

Litigation

In litigation cases, the retainer can help the client represent, accompany and provide legal assistance as a plaintiff or defendant, petitioner or respondent, and as a witness in a civil case while in a criminal case the retainer can help a client represent, assist and provide legal assistance as a reporter or the reported, suspect or defendant in a legal case.

Non-litigation

In non-litigation cases, the retainer functions as a legal advisor who provides legal explanations and views in accordance with Indonesian law relating to companies.

The scope of the retainer in non-litigation includes making agreements, reviewing agreements, making legal opinions, legal drafting, legal audits, preparing GMS documents, and helping to take care of the required company permits.

In using retainer services in a legal matter, it is highly recommended for the client, because it has greater advantages than using the services of an ordinary lawyer. These advantages include reducing the cost of legal consultants and providing varied services that can help with litigation and non-litigation problems so that they are not fixed on one case and can even solve several cases at the same time.

Suspension of Debt Payment Obligations (PKPU)

Posted by Dr. Guan Yue on

In the business world, the problem of debt and receivables has become a very common problem, many entrepreneurs complain about this problem because it can result in the company’s cash flow decreasing. One of the ways to solve these problems can be solved by Suspension of Debt Payment Obligations (in Indonesian: Penundaan Kewajiban Pembayaran Utang, abbreviation: PKPU) which can be submitted to the Commercial Court.

The legal basis for PKPU has been regulated in Law Number 37 of 2004 concerning Bankruptcy and PKPU or abbreviated as UUK 2004 in Article 222 paragraph (2). Which states that:

 “Debtors who cannot or expect not to be able to continue paying their debts that are due and collectible may request a suspension of debt payment obligations with a view to submitting a reconciliation plan which includes an offer to pay part or all of the debt to creditors.”

In Indonesian law, PKPU is divided into two, namely Temporary PKPU and Permanent PKPU. Temporary PKPU is decided by the Commercial Court and is valid for 45 days after the decision is readout. Within these 45 days, the Debtor is required to make a reconciliation plan and a scheme for the settlement of his debts to the Creditor. Meanwhile, the Permanent PKPU will take effect within 270 days of the provisional PKPU decision being readout. Within those 270 days, the Debtor has prepared a plan for the settlement of his obligations, not the deadline for repayment. If there is no agreement between the Debtor and Creditor by the time limit, the Commercial Court will decide the Debtor is bankrupt and confiscate the property the Debtor owns in order to pay off the debt.

We can conclude that PKPU is one of the simple, fast, and low-cost business dispute resolutions. Because it doesn’t take as long as a Civil Lawsuit in District Court.

Divorce in Indonesian Law

Posted by Irfan Disnizar, SH. on

Divorce cannot be avoided by many couples who feel their marital relationship is no longer healthy where quarrels cannot be avoided every time, not to mention some of them are colored with domestic violence, when things like that happen many couples want to end the marriage by divorce in order to get a better life, but many people still do not understand how the divorce process is so below we will briefly explain how the divorce process is carried out.

Marriage can be terminated by death, divorce and court decisions in Article 39 of Law Number 1 of 1974 states that:

  1. Divorce can only be carried out before a court session after the court concerned has tried and failed to reconcile the two parties;
  2. To carry out a divorce there must be sufficient reason that the husband and wife will not be able to live in harmony as husband and wife;
  3. The procedure for divorce before a court hearing is regulated in a separate statutory regulation.

Paragraph one clearly states that a legal divorce can only be carried out before a court session after the court concerned has tried and failed to reconcile the two parties. Then what about couples who claim to be divorced religiously who claim to have been divorced by their husbands? So we can conclude that the divorce is not valid and in law the divorce is not valid and their status is still in a legal marriage bond.

In verse two in order to divorce, there must be sufficient reason that the husband and wife will not be able to live in harmony as husband and wife. The reasons for this are contained in Article 39 of Law Number 1 of 1974 jo. Article 19 Government Regulation Number 9 of 1975 contains the following:

  1. One of the parties commits adultery or becomes a drunkard, compactor, gambler and so on which is difficult to cure;
  2. One of the parties leaves the other for 2 (two) consecutive years without the permission of the other party and without any valid reason or because of any other matter beyond his ability;
  3. One of the parties gets a prison sentence of 5 (five) years or a heavier sentence after the marriage takes place;
  4. One of the parties commits cruelty or serious harm that is harmful to the other party;
  5. One of the parties has a physical disability or disease which causes them to be unable to carry out their obligations as husband/wife;
  6. Between husband and wife, there are constant disputes and quarrels and there is no hope of living in harmony again in the household.

The reasons mentioned above are still being added 2 more as stated in article 116 of the compilation of Islamic law, namely:

  1. The husband violates taklik talak (conditions which can precipitate a divorce under Islamic law) (article 116 letter (g) of the Compilation of Islamic Law).
  2. Religious conversion or apostasy that causes disharmony in the household (article 116 letter (h) Compilation of Islamic Law).

Whereas in paragraph three the procedure for divorce is regulated in Government Regulation Number 9 of 1975, which allows a husband or wife to file a lawsuit in court, which needs to be known for Muslim and non-Muslim divorces carried out in different courts, for Muslim couples divorce is carried out in court. religion, while for non-Muslims it is done in the District Court.

Legal Notice

Posted by Irfan Disnizar, SH. on

At this time, many people are confused with the Legal Notice, what is the Legal Notice? Is the Legal Notice useful for solving problems? And there are many more questions about Legal Notice so we will discuss them here.

A Legal Notice is a warning letter from a potential Plaintiff to a prospective Defendant as regulated in Article 1238 of the Civil Code which states that: “The debtor is negligent if he with a warrant or with a similar deed has been declared negligent, or for the sake of his own engagement, if this stipulates, that the debtor will have to be considered negligent with the passage of time found.”

The contents of the Legal Notice should at least contain the identity of the prospective Plaintiff, the identity of the prospective Defendant, the background of the problem, negligence committed by the potential defendant, requesting the rights of the prospective Plaintiff, order for the prospective Defendant to immediately fulfill his obligations and provide space to negotiate, this space to negotiate is a way of resolving disputes in a family manner which is usually done before a lawsuit is filed in court.

Is the Legal Notice useful for solving problems? Of course, it is useful and one of the effective ways to resolve a dispute because the Legal Notice is in the form of a warning letter reminding the prospective Defendant to immediately fulfill his obligations and as a goodwill gesture from the prospective Plaintiff to resolve the dispute amicably before the lawsuit is filed in court.

Difference between PT and CV

Posted by Irfan Disnizar, SH. on

So far, there have been many questions from entrepreneurs who have just started their business, who have questioned the difference between a PT and a CV.

PT stands for Limited Liability Company which is formed as a legal entity as stated in Law Number 40 of 2007 concerning Limited Liability Companies, while CV stands for Commanditaire Venootschap or limited liability company, which is a company that is not a legal entity because there are no regulations governing it.

Here are the most obvious differences between PT and CV:

  1. Accountability
    The liability of PT is delegated to the Board of Directors, while the liability of shareholders is only limited to the amount of capital invested, as stated in Article 3 paragraph 1 of Law Number 40 of 2007 concerning Limited Liability Companies. While the responsibility for the CV is delegated to the Complementary Partners who are fully responsible severally and severally up to personal assets.
  2. Management
    PT is managed by the Board of Directors who is fully responsible for the management of PT for the interests and objectives of the company and represents the company both inside and outside the court in accordance with the articles of the association while CV is managed by a complementary partner who is fully responsible for managing CV.
  3. Organization
    The PT organization is more structured while the CV is only managed by the Complementary Partner.
  4. Company Organ
    PT has a clear corporate organ, namely the GMS, the Board of Directors, and the Commissioner, while the CV only has a complementary partner.
  5. Capital
    In Law Number 40 of 2007, the capital for the establishment of a PT is set at Rp 50 million, unless otherwise stipulated by the law or regulations governing the implementation of such business activities in Indonesia. Of the minimum capital, as much as 25 percent of the total initial capital must be issued and fully paid up. As for CV, there is no capital limit in its establishment.

Thus, above are some of the differences between PT and CV, in the author’s opinion, if you are going to establish a company, it is better to have a PT with the consideration that the PT has a legal entity, the capital consists of shares, limited liability and has a structured organization.

The Income Tax that Companies and Entities must pay

Posted by Dr. Guan Yue on

In any country, including Indonesia, a taxation is an essential tool for the development of the entire society. Through taxation, people can enjoy infrastructure such as roads, terminals, stations, airports, etc. Therefore, it is not surprising that the country expects its citizens to comply with tax regulations. Furthermore, not only residents but also corporations or legal entities are subject to tax.

Every corporate tax is related to income tax. Income tax (PPh) means a type of tax levied on a specific party. Therefore, corporate tax applies not only to Indonesian companies but also to foreign companies.

Therefore, everyone has to pay tax obligations, including Limited Liability Company (PT), Limited Partnership (CV), and Firm (Fa). Additionally, these companies and legal entities must have a Taxpayer Identification Number (NPWP).

So, what corporate taxes are required and must be paid by the above companies and entities? Here are eight types of corporate income taxes to know about.

  1. Income Tax Article 21 (PPh 21)
    Income Tax Article 21 is a monthly tax that must be paid. This tax comes from the taxpayer’s income, such as wages, allowances, or other service charges. Companies have usually taken direct deductions from taxpayers’ or employees’ wages. Then submit proof of withholding Income Tax Article 21 paid to the employee.
  2. Income Tax Article 22 (PPh 22)
    Income Tax Article 22 applies to certain state-owned and private business entities engaged in export, import, and re-import trade activities. However, the tax can only be levied when there is a profit between buyers and sellers.
  3. Income Tax Article 23 (PPh 23)
    Income Tax Article 23 is levied on the taxpayer in the event of a transaction between the parties. These transactions include royalties, gifts, interest, or rent. However, it can also be a commercial transaction such as a building or service.
  4. Income Tax Article 25 (PPh 25)
    Income Tax Article 25 is a tax paid in installments. The tax owed must be paid within one year, and its purpose is to reduce the burden on taxpayers. This tax must be paid by the taxpayer himself and cannot be paid on his behalf.
  5. Income Tax Article 26 (PPh 26)
    Income Tax Article 26 is an income tax levied on income earned by foreign taxpayers from Indonesia. If Indonesian regulations apply, the rate is 20% of the net income valuation. However, where the provisions of the Tax Treaty apply, the rates will be determined by specific terms and conditions.
  6. Income Tax Article 29 (PPh 29)
    Income Tax Article 29 is the underpaid income tax listed in the annual Income Tax Return (SPT), i.e. the remainder of the income tax payable for the relevant tax year less Income Tax Article 21, Income Tax Article 22, Income Tax Article 23, Income Tax Article 24 and Income Tax Article 25 credits.
  7. Income Tax Article 4 (2) (PPh Pasal 4 ayat 2)
    Income Tax Article 4 (2) is also known as final income tax and the rate of income tax varies depending on the income. For example, for micro, small and medium-sized businesses, self-employed or online businesses with a turnover of less than IDR 4.8 billion in 1 tax year, the tax rate is 1% of the total sales for 1 tax year.
  8. Income Tax Article 15 (PPh 15)
    Income Tax Article 15 is an income tax levied on taxpayers engaged in the shipping industry, international airlines, and foreign insurance companies.

For start-up companies, taxes are often very complicated. Therefore, in order to avoid mistakes in corporate taxation, it is recommended that taxpayers go directly to the local tax office for more detailed inquiry and confirmation.

Establishment of Supplements and Cosmetics MLM Company

Posted by Irfan Disnizar on

COMPANY ESTABLISHMENT

Retail trading business group of goods by selling them includes trading activities through direct sales or special distribution systems such as single-level marketing and multi-level marketing, as well as retail trade commission agents. (ref. KBLI 47999)

The Business Sector is regulated in Government Regulation No. 29 of 2021.

The Scope of Activities is regulated in Government Regulation No. 5 of 2021, it is required that:

  • Business Entity in the form of Limited Company; and
  • Employ at least 1 Indonesian citizen as a member of the Board of Directors and 1 Indonesian citizen as a member of the Board of Commissioners.

MLM LICENSE

Business licensing requirements

  1. Business entity in the form of Limited Company
  2. Meet the criteria:
    (1) Has exclusive distribution rights for goods to be distributed through direct sales.
    (2) Have a marketing program (marketing plan);
    (3) Have a code of ethics;
    (4) Recruiting direct sellers through a network system;
    (5) Selling goods directly to consumers through a marketing network developed by direct sellers;
    (6) Employ at least 1 Indonesian citizen as a member of the board of directors and 1 Indonesian citizen as a member of the board of commissioners.

Business licensing obligations

  1. The company provides information orally and in writing to prospective direct sellers at least regarding:
    (1) Company identity;
    (2) Quality and specifications of goods;
    (3) the condition and guarantee of the goods and provide an explanation of their use, repair, and maintenance;
    (4) Marketing program (marketing plan);
    (5) Code of ethics.
  2. Companies that have recruited direct sellers must:
    (1) Provide sales aids (starter kit) to each direct seller which at least contains information on goods, marketing plan, and code of ethics;
    (2) Ensuring that the activities carried out by direct sellers are in accordance with the marketing plan and code of ethics;
    (3) Attaching a label on the goods and/or packaging containing at least the name of the company and a statement that the goods are sold using a direct selling system;
    (4) Determine the price of goods sold in rupiah currency and applies to direct sellers and consumers;
    (5) Providing commissions and/or bonuses based on the results of goods sales activities carried out by the direct seller and his network in accordance with the agreement;
    (6) Giving a grace period to the consumer to return the goods within a period of 7 (seven) working days from the receipt of the goods, if it turns out that the goods are not in accordance with the agreement;
    (7) Provide compensation, compensation, and/or compensation for losses caused by the use, use, and utilization of traded goods;
    (8) Carry out coaching and training to improve the ability and knowledge of direct sellers, so that they act correctly, honestly, and responsibly at least once in 1 (one) year;
    (9) Providing equal opportunities to all direct sellers to excel in marketing goods;
    (10) Have a list of direct sellers who are members of their marketing network which is equipped with the identity data of the said direct sellers;
    (11) Selling goods that already have a distribution permit or have complied with the provisions of quality standards in accordance with the provisions of laws and regulations;
    (12) Ensure direct sellers do not sell goods through indirect distribution channels and/or online marketplaces.
  3. The Company submits a report on the Company’s business activities to the Central Government.

CERTIFICATION OF SUPPLEMENTS AND COSMETICS

  • Registration of Supplements and Cosmetics (minister/head of the agency)
  • Distribution Permit for Supplements and Cosmetics (minister/head of the agency)
  • Approval of Supplements and Cosmetics Advertisement (minister/head of the agency)
  • Clinical Trial of Supplements and Cosmetics (minister/head of the agency)
  • Importer recommendation (minister/head of the agency)
  • Recommendation as an applicant for Notification of Supplements and Cosmetics (minister/head of the agency)
  • Supplement and Cosmetic Notification Standard Certificate (minister/head of the agency)
  • Domestic Electronic System Operator Registration Certificate (TD PSE) (minister/head of the agency)

The Difference between Authorized Capital, Issued Capital, Paid-Up Capital in Indonesian Company Law

Posted by Dr. Guan Yue on

The rapid development of Indonesia’s economy has attracted a large number of foreign investors to set up companies in Indonesia. Investors often cannot distinguish the difference between registered capital, issued capital, and paid-in capital. Queen Law Firm will explain this issue to the majority of foreign investors today.

In Indonesia’s regulations on company establishment, capital is divided into three types, namely, Authorized Capital (modal dasar), Issued Capital (modal ditempatkan), and Paid-Up Capital (modal disetor).

Authorized Capital is the entire nominal value of the company’s shares mentioned in the Articles of Association or the Deed of Establishment document. Authorized Capital in principle is the total number of shares that can be issued by the company.

Issued Capital is the number of shares that have been taken by the founders or shareholders. In other words, Issued Capital is the capital that the founders or shareholders are able to repay. So it is possible for the capital that has been written in the Deed of Establishment document indirectly and in the near future, it is agreed to be provided by the owners of capital. In other words, the company’s finances that initially had 0 or nothing would get a capital injection, but some were immediately available and some were still promised to be available.

Paid-up Capital is capital that has been entered by the shareholders as payment for shares taken from the issued capital. So, Paid-up Capital is capital that has actually been paid into the company. If the capital value has been given from the owner of the capital to the company, then the value becomes the property of the company and is recorded in the company’s books. In other words, the company gets fresh money from the owners of capital. The amount of Issued Capital that has not been paid up can be recorded as a liability/debt of the owner of the capital to the company.

Simply put, the difference between Issued Capital and Paid-up Capital is that when the owner of the capital has agreed to provide capital of IDR 500 million in the form of money or goods, the capital is referred to as Issued Capital. If the capital has not been provided, it will be considered a debt. When he has given the Rp 500 million, then the debt is considered paid off and is referred to as Paid-up Capital.

According to the “Indonesia Company Law”, the company must have issued and paid at least 25% of the registered capital when it is established. For example, for a foreign company, the registered capital is at least IDR 10 billion, so the company’s establishment contract must state that the registered capital is IDR 10 billion. According to the law, at least 25% of IDR 10 billion, or IDR 2.5 billion of issued capital, must be injected and deposited when the company is established. This amount is the minimum amount, so if you want to deposit more than IDR 2.5 billion, of course, you can.