In this globalization era, economic is growing rapidly. Many people are interested to start a business by setting up a company in a form of Limited Liability Company (Perseroan Terbatas/PT). PT is one of legal business entities that own its own assets in accordance with the capital injected into the company to be converted into shares. Nevertheless, it could not be denied that the share ownership in a company is owned by a married couple.
Although there is no prohibition for married couple to be a shareholder in a company (vide Law No. 40 of 2007 Concerning Limited Liability Company). However, pursuant to the Law No. 1 of 1974 Concerning Marriage ("Marriage Law"), a husband and a wife are not considered as 2 (two) separate people if there is no prenuptial agreement. This is because a married couple is considered united as one and has the same purpose and interest, thus all assets which earned during the marriage period become joint property, as stipulated in Article 35 of Marriage Law.
Therefore, it is necessary to understand the validity of shares owned by a married couple in a company.
As explained above, a married couple can be a shareholder in a company in 2 (two) ways, namely:
Having prenuptial agreement; or
- There is any other shareholder (both individual or entity) in a company (for a married couple who does not have a prenuptial agreement.)
Furthermore, the prenuptial agreement is intended to regulate the authority in conducting legal actions for the assets of the parties, hence, the existence of prenuptial agreement as a dispensation as stipulated in Marriage Law (vide Article 29 of Marriage Law), which in this case, the married couple becomes the shareholder of a company.
If the married couple does not have a prenuptial agreement, then they must appoint or invite another party as a shareholder in the company. However, there is no restriction for the third shareholder qualification. Thus, in practices, the appointed shareholder is the married couple’s family relative or outsider who does not have blood relation/relatives.
HOW CAN SMART ASSIST YOU?
To ensure a smooth investment and business operation from the legal perspective, but also still focus on maintaining your business in Indonesia and reach your revenue target, it is advised for you to find capable and trusted lawyers or legal consultants for advice and assistance in ensuring your legal compliance with prevailing laws and regulations.
SMART Consulting is an Indonesian Corporate Legal Services firm. We have assisted local and multinational companies in handling and giving legal advice regarding their corporate matters, including shareholder’s composition and liaising with the relevant government authorities concerning the compliance of our Clients.
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