Procedures for the legalization of a legal entity

The government introduced an electronic based system for the legalization of a legal entity at the end of last year, by issuing Regulation No. M-01-HT.01-10 of 2007 (“Regulation No. 10/2007”) regarding Procedures for the Legalization of a Legal Entity, Amendment to a Legal Entity’s Articles of Association and Notification Thereof, and Changes to a Legal Entity’s data. This Regulation is the implementation of Article 10 (2) and 11 of the new Company Law.
The new online administration system, referred to as “Sistem Administrasi Badan Hukum” (Legal Entity Administration System) or its acronym “Sisminbankum”, is run by the Directorate General of General Law Administration as a service to the public in processing the above mentioned applications as well as for obtaining other information. Under the system, the applications must be submitted by a notary who acts as the proxy of the legal entity’s founders. The application is prepared by completing the provided application forms referred to as FIAN or “Format Isian Akta Notaris” (Notary Deed Application Form). There are three types of FIAN, respectively for the Legalization of the legal entity (FIAN Model I), Amendment to the Articles of Association (FIAN Model II), and Notification of the Amendment to the Articles of Association and Changes to the Company’s data (FIAN Model III).Regulation No. 10/2007 provides that upon the submission of a FIAN the Minister of Law and Human Rights (MoLHR) or the appointed officer may issue a notification through the Sisminbankum on whether the application is rejected or accepted. If an application is accepted, within 30 days as from the statement of acceptance (or of no objection), the Notary must submit all of the required supporting documents, and at the longest 7 days following which the MoLHR will issue his Decision. Legal entities which do not submit an application for the legalization of the legal entity within 60 days as from the execution of the deed of establishment will be deemed as dissolved by operation of the law.