Nominee Agreement Indonesia

Nominee Agreement in Indonesia: All You Need to Know

Starting a business in Indonesia can be a complicated process due to the country’s laws and regulations. As a foreigner, it’s essential to understand the necessary legal requirements to prevent legal issues and protect your business from potential legal risks. One of the important aspects of setting up a business in Indonesia is having a nominee agreement in place.

What is a Nominee Agreement?

A nominee agreement is a legal agreement between two parties, where one party (the nominee) holds and manages assets or shares on behalf of the other party (the beneficiary). In other words, a nominee agreement is a legal tool used to allow a person or entity to act as a nominee or trustee for someone else’s interests.

In Indonesia, a nominee agreement is often used by foreign investors who want to establish a company in the country but cannot do so directly. By using a nominee agreement, foreign investors can legally hold shares in the company, as Indonesian law limits foreign ownership restrictions in certain industries.

The nominee agreement in Indonesia functions as a legal tool that enables foreign investors to have legal ownership of a company without violating foreign ownership restrictions. The nominee shareholders hold shares in the company for the benefit of the foreign investors, making it easier for them to invest in certain industries in the country.

Requirements for Nominee Agreement in Indonesia

To establish a nominee agreement in Indonesia, several requirements must be met. These include:

1. The nominee must be an Indonesian citizen or legal entity with Indonesian nationality.

2. The nominee agreement must be drafted in both Indonesian and English languages.

3. The nominee agreement must be legally binding and signed by both parties, with a copy sent to the Ministry of Law and Human Rights.

4. The nominee must issue a power of attorney (POA) to the foreign investor, giving them control over the shares.

It’s important to note that the nominee does not have any rights or control over the shares they hold on behalf of the beneficiary. Also, the nominee agreement must be legitimate and transparent, and the beneficiary should keep a record of all documentation to avoid any legal complications.

Benefits of a Nominee Agreement in Indonesia

1. Compliance with Foreign Ownership Restrictions: By using a nominee agreement, foreign investors can comply with the foreign ownership restrictions in certain industries in Indonesia. This can save investors from time-consuming processes and legal complications associated with finding a local partner or establishing a joint venture.

2. Protecting Business Interests: Nominee agreements help protect the business interests of foreign investors in Indonesia. By using a nominee, foreign investors can retain ownership of their assets, without losing control of the company.

3. Maintaining Confidentiality: Nominee agreements provide a level of confidentiality for foreign investors who do not want their names or personal information to be publicly disclosed.


In summary, a nominee agreement is a legal tool used by foreign investors in Indonesia to comply with foreign ownership restrictions and protect their business interests. It’s essential to ensure the nominee agreement is legitimate, transparent, and legally binding to avoid any legal complications. If you’re a foreign investor planning to establish a business in Indonesia, consult with a legal expert experienced in nominee agreements to guide you through the process.