Are you a Businessman? Get to know these types of business entities!

When you want to start a sustainable business, legal status is something you need to pay attention to. Registering a Business Entity can be an effort so that your business can grow and get legal protection. A business entity is an entity formed by one or several people to carry out a business or business activity. In Indonesia, several types and forms of business entities can be selected according to the needs and goals to be achieved. The following is an explanation of the types and forms of business entities in Indonesia.

Limited Liability Company (PT)

A limited liability company or PT is a business entity with its legal entity and its capital is divided into shares owned by shareholders. One or more shareholders can own PT. PT has the authority to issue shares and to offer shares to the public. PTs can also obtain loans from banks or other financial institutions. PT is suitable for businesses that have large capital and complex business activities.

Cooperative

Cooperatives are business entities owned by cooperative members who work together to achieve common goals. Cooperative members have the right to make decisions at member meetings and get a share of the profits generated by the cooperative. Cooperatives are suitable for businesses based on cooperation and togetherness, such as farming, fishing, and savings, and loan cooperatives.

Firm

Firma is a business entity owned by two or more people who work together to run a business. The firm does not have its legal entity and the firm members are fully responsible for all business activities carried out. Firma is suitable for small and medium businesses that have several members and want to do business together.

CV (Commanditaire Vennootschap)

CV or Commanditaire Vennootschap is a form of business entity consisting of two types of partners, namely active partners and passive partners. Active partners are fully responsible for all business activities carried out, while passive partners are only responsible for paid-up capital. CV is suitable for businesses based on collaboration between two or more parties who have different roles and responsibilities.

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Sole Proprietorship

An individual company is a business entity owned by one or more people but does not have a separate legal entity. The owner of a private company is fully responsible for all activities carried out by the company. This form of business entity is suitable for small and simple businesses that do not require a lot of capital and complex activities.

State-Owned Enterprises (BUMN)

BUMN is a business entity that is wholly owned by the Indonesian government or recognized by the state as a business entity owned by the state. SOEs have a strategic role in economic development and national development, especially in sectors that are considered important for the interests of the state and society. SOEs have advantages such as access to state resources, the ability to make long-term investments, and strong credibility in business.

BUMN itself is divided into 2 legal statuses, namely BUMN Persero & BUMN General Company (Perum). The difference between BUMN Persero and Perum lies in their legal status. BUMN Persero is a state-owned enterprise regulated by Law Number 19 of 2003 concerning BUMN, while Perum is a state-owned enterprise regulated by Government Regulation Number 44 of 2005 concerning Limited Liability Companies.

BUMN Persero

BUMN Persero has characteristics as a business entity that have national interests and are profit-oriented. BUMN Persero aims to improve people's welfare and develop the national economy. For example, PT Pertamina (Persero) is responsible for the energy sector and PT PLN (Persero) is responsible for the electricity sector.

BUMN Perum

Meanwhile, BUMN Perum aims to provide public services and is not entirely profit-oriented. For example, Perum Perhutani is responsible for managing state forests and Perum the Indonesian Aviation Navigation Service Provider (AirNav Indonesia) is responsible for managing air traffic.

Another difference lies in the organizational structure and decision-making mechanisms. BUMN Persero usually has a more complex organizational structure and a more centralized decision-making mechanism. Whereas Perum usually has a simpler organizational structure and a more decentralized decision-making mechanism.

Regional Owned Enterprises (BUMD)

A regional company is a business entity owned by the local government. Regional companies function to improve public services and development in the area. Regional companies have different duties and responsibilities 

determined by the local government. Regional companies are suitable for businesses based on public services and regional development. For example, in Jakarta, there is TransJakarta, Bank DKI, and in Central Java there is Bank Jateng. it should be understood that BUMD is not bound to the central government.

Foundation

A foundation is a business entity established by one or several people for social, religious, or humanitarian purposes. Foundations are not profit-oriented and are not owned by certain individuals or groups, but are owned by the public interest and are managed by the foundation's management. Foundations can be established by individuals, groups, or institutions who wish to donate their wealth or other resources for social and humanitarian purposes. Foundations can also obtain funds from donations and donations from the public or other parties.

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