Opening a branch office in Indonesia is a legal process to establish a company’s business unit in a different location without forming a new legal entity. A branch office is legally recognized as a direct part of the parent company and is subject to regulations from BKPM, the OSS (Online Single Submission) system, and the Directorate General of Taxes. The establishment of a branch office in Indonesia regulates aspects such as business licensing, NIB registration as an attachment, business domicile, and branch tax obligations—both administrative and operational.
This regulatory framework serves as the legal basis for both PMDN and PMA companies to expand their business activities lawfully, in a controlled manner, and with minimal legal risk.
Read Also: What Is a Branch Office: Definition, Functions, and Regulations
Definition and Legal Status of a Branch Office
A branch office is an operational or administrative unit located separately from the head office. Legally, a branch office is not a separate entity. All authority and responsibility remain with the parent company. This means that policies, organizational structure, and branch activities must comply with the parent company’s articles of association.
Types of Branch Offices: Administrative vs Operational
There are two types of branch offices with different legal implications:
Administrative Branch Office
- Functions are limited to administrative and supporting activities
- Does not require Business Licensing to Support Business Activities (PB UMKU)
- Only needs to be registered as an attachment to the parent office’s Business Identification Number (NIB)
- Does not require a separate NIB
- Cannot conduct commercial transactions
Operational Branch Office
- Conducts direct business activities and generates revenue
- May conduct buying and selling transactions, receive payments, or provide services
- Is required to pay taxes and submit financial reports
- May require additional operational licenses depending on the business sector
Choosing between these two types of branch offices is critical, as it determines the administrative burden and licensing complexity involved.
Required Documents for Opening a Branch Office
In general, you need to prepare the deed and approval letter of the parent company, NPWP, parent company business license, and a deed of branch office establishment prepared by a notary. These documents must state the branch address, scope of activities, and appointment of the branch head. Accuracy at this stage is crucial, as it forms the basis for registration in OSS and other relevant authorities.
Details of the required documents for opening a branch office can be seen in the table below:
| Document Category | Specification | Description |
|---|---|---|
| Parent Company Documents | Deed and Approval Letter of the Parent Company | Original or legalized copy |
| Parent Company NPWP | Photocopy | |
| Parent Company Business License (SIUP/TDP) | Photocopy | |
| Articles of Association | Includes information on branch offices | |
| Branch Office Documents | Deed of Branch Office Establishment | Prepared by a notary, stating the branch name, address, and business activities |
| Board of Directors Resolution | Regarding branch establishment and official approval | |
| Appointment of Branch Office Head | In the form of a notarial deed | |
| ID Card of Branch Office Head | Photocopy | |
| NPWP of Branch Office Head | Photocopy (if already available) | |
| Business Location | Statement Letter of Business Location | Official declaration of the branch address |
| Proof of Ownership or Lease Agreement | For physical location or virtual office | |
| For Amendments | Previous Branch Office License | Existing certificate |
| Activity Realization Report | Documentation of activities | |
| Supporting Documents for Amendments | According to the type of amendment |
Branch Office Registration Procedure
The branch office registration procedure follows different flows depending on regulatory authority:
For Companies Under Central Government Authority (generally PT PMA and strategic businesses):
- Report the plan to open a branch office to the Central One-Stop Integrated Service (PTSP) at the Investment Coordinating Board (BKPM)
- For administrative branch offices that already have an NIB: simply log in to the OSS (Online Single Submission) system and fill in “additional data”
- Submit the application through the Electronic Investment Information and Licensing Service System (SPIPISE)
For PMDN Under Regional Government Authority:
- Report the plan to open a branch office to the Provincial Investment and One-Stop Integrated Service Office (DPMPTSP)
- Follow the OSS procedure to register additional data
Process Timeline:
- The branch office establishment certificate is issued in the form of a digitally signed certificate (PDF) within a maximum of 3 working days after a complete and correct application is received
- For administrative branch offices: the process is faster as no separate operational license is required
NIB Status for Branch Offices:
- Branch offices do not require a separate NIB
- The NIB remains attached to the head office, with branch office information recorded as an attachment
- If the branch office has its own financial transactions, registration of a Branch NPWP (or NITKU) with the local tax office is required; this is separate from the NIB
Domicile and Certificate of Company Domicile (SKDP)
In Jakarta:
Since the abolition of SKDP, the domicile of a PT is sufficiently evidenced by the Business Identification Number (NIB) obtained through OSS. The domicile listed in the NIB is the head office address as stated in the articles of association.
In Other Regions:
Branch offices still require a Certificate of Company Domicile (SKDP) as proof of the legal business location. The SKDP is issued by the village or sub-district office, signed by the village head and sub-district head.
SKDP requirements for branch offices:
- Stamped application letter
- Company establishment deed and branch establishment deed
- ID cards of the director and branch head
- Photocopies of the company and branch head NPWP
- Lease agreement or proof of ownership of the premises
- Proof of payment of the latest land and building tax (PBB)
- Photos of the exterior and interior of the branch office location
Timeline: SKDP is processed within a maximum of 7 working days, with no administrative fees.
Read Also: Business Location: The Key to Your Business Success
Tax Aspects and NPWP for Branch Offices
Administrative branch offices generally use the head office’s NPWP. However, if the branch conducts its own financial transactions, registration of a branch NPWP or NITKU becomes mandatory. Operational branches must also fulfill income tax (PPh) and VAT (PPN) obligations in accordance with Directorate General of Taxes regulations.
Virtual Office as a Branch Office Option
In practice, not all branch offices require a full physical space. For administrative functions, a virtual office can be a legal solution as long as it complies with zoning and local regulations. Virtual offices help companies reduce costs, speed up the branch establishment process, and maintain a legitimate business address.
Many entrepreneurs, consultants, and freelancers choose virtual offices for branch offices due to their flexibility and efficiency. This model is suitable for regional expansion, market testing, or strengthening business presence without heavy operational burdens.
Check: Use of Virtual Offices for Branch Offices in Indonesia
vOffice as Your Branch Office Partner
As a virtual office provider since 2012, we at vOffice understand the legal and professional requirements of branch offices. With more than 40 strategic locations across Indonesia, our services enable you to open a branch office quickly, legally, and credibly. This is a logical step for those who want to focus on business growth without being hindered by administrative matters.
Check: vOffice Virtual Office, the Right Choice for Branch Offices in Indonesia
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FAQ: Opening a Branch Office in Indonesia
Does a branch office need to be registered?
Yes. A branch office must be registered through OSS as part of the parent company.
Does a branch office require its own NIB?
No. The NIB remains with the head office, while branch data is recorded as an attachment.
Is a virtual office legal for a branch office?
Yes, for administrative functions, as long as it complies with zoning and local regulations.
How long does it take to open a branch office?
Generally 3–7 working days, depending on document completeness and location.
Can all types of businesses use a virtual office?
No. Certain sectors such as manufacturing and finance have specific restrictions.
