The (New) Company Law Framework

The (New) Company Law Framework 

Ever since Indonesia’s independence, business sectors and 

mainly business enterprises have played an important role in 

fostering Indonesia’s economic  growth. There are various 

regulations that govern Indonesian business organizations. 

Presently, the laws of Indonesian business organizations are 

primarily governed by the Law on Limited Liability Company, Law 

No.1 of 1995 (Undang-Undang tentang Perseroan Terbatas or 

“UUPT”) which is considered modern Indonesian company law 

(referred also as the New Indonesian Company Law), the 

Indonesian Civil Code (Kitab Undang-Undang Hukum Perdata or 

Burgelijke Wetboek), and the Indonesian Commercial Code (Kitab 

Undang-Undang Hukum Dagang or Wetboek van Koophandel).  

The last two codes were first promulgated during the Dutch colonial 

rule.  

The UUPT, consist of 129 articles and was enacted on 

March 7, 1995 and came into effect  a year later. Prior to the 

enactment of UUPT the limited liability company was governed by 

only twenty-one articles in the Indonesian Commercial Code. The 

UUPT symbolizes the first major revision of the Indonesian 

company law since the commercial code. The promulgation of the 

law was a response to the rapid  economic progress that needed 

provisions to complement international practices and the modern 

commercial sector. This paper will focus on the UUPT since it 

serves as the basis of Indonesian corporate structures.

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