Under the Law No. 40 of 2008 known as New Company Law, the basic capital structure of a limited liability company (authorized capital, subscribed capital and paid-up capital) remains the same. The minimum authorized capital threshold has been raised from IDR 20 million to IDR 50 million. The minimum of 25% of the authorized capital must be subscribed and paid-in, and to be evidenced by a valid payment notice. The New Company Law includes strict cross holding provisions specifically with regards to issuing of shares that are to be held by subsidiary companies to the parent or to be held by the issuing company themselves.

Shares which are repurchased or been acquired through an inheritance or other bequest cannot be used as voting shares in GMS meetings. Such shares also will not be counted in determining quorum for GMS meeting. The New Company Law imposes a compulsory obligation for the company to first offer to the shareholders new shares issued. The shares must be issued in the name of the owner of those shares and not in the name of a proxy. The conditions associated with share ownership are to be stipulated in the Article of Association of the relevant company.

Source: www.hukumonline.com, ILB 10/9/2007: Capital and Shares in the New Company Law