Legal Due Diligence (LDD) is a legal examination or legal audit to make sure that the upcoming business transaction is worthy, it is a critical part of any upcoming transaction and it needs to be done thoroughly.
We provide legal due diligence to support clients with a clear legal perspective on any upcoming business transaction or other legal matters. This involves a comprehensive examination of client or counterpart business, corporate documentation, business operation license or permits, material contracts, assets, HR or employment matters, intellectual property, and historical as well as current legal disputes, along with elaboration on potential legal challenges that may affect the success of upcoming transactions.
Why do you need to conduct legal due diligence?
The following are the phases of legal due diligence:
Selected Project Handled:
When should I consider Tax Due Diligence?
Tax Due Diligence is crucial during mergers, acquisitions, company restructuring, or when preparing for a sale. It ensures you have a clear understanding of the company’s tax position before making critical decisions.
What are the potential outcomes of Tax Due Diligence?
Our findings will highlight any tax risks, compliance issues, or areas where improvements are needed. We provide recommendations to address these issues, helping you make informed decisions.
What happens if tax issues are found during Due Diligence?
If tax issues are identified, we’ll work with you to develop strategies to mitigate these risks. This may involve negotiating with the other party in the transaction or addressing the issues before proceeding.
Can Tax Due Diligence prevent future tax disputes?
While it can’t guarantee immunity from future disputes, Tax Due Diligence significantly reduces the risk by ensuring that any existing issues are identified and addressed early on.
Can Tax Due Diligence affect the valuation of a company?
Yes, Tax Due Diligence can impact a company’s valuation. Unresolved tax issues or significant liabilities discovered during the process may lead to adjustments in the purchase price or deal terms.
What are the common challenges in Tax Due Diligence in Indonesia?
Challenges include navigating complex tax regulations, incomplete or inaccurate financial records, and historical non-compliance.
How does Tax Due Diligence differ from a standard financial audit?
A financial audit focuses on the accuracy of financial statements, while Tax Due Diligence specifically examines tax compliance and risks. The two processes complement each other but serve different purposes.
What are the key regulations governing M&A in Indonesia?
Key regulations include the Company Law (Law No. 40 of 2007), the Capital Market Law (Law No. 8 of 1995), and regulations from OJK and KPPU. These laws cover everything from corporate restructuring to competition issues and disclosure requirements.
Are there any specific regulatory approvals required for M&A in Indonesia?
Yes, M&A transactions often require approvals from OJK for listed companies and may also need to be reviewed by KPPU to ensure they do not violate antitrust laws. Sector-specific approvals might also be necessary depending on the industry.
How does the Indonesian Competition Commission (KPPU) impact M&A deals?
KPPU reviews M&A transactions to prevent anti-competitive practices and monopolistic behavior. Transactions that meet certain thresholds or could impact market competition may need to be reported and reviewed by KPPU.
What are the tax implications of M&A in Indonesia?
M&A transactions can trigger various tax obligations, including corporate income tax, value-added tax (VAT), and transfer taxes.
Can foreign investors participate in M&A transactions in Indonesia?
Yes, foreign investors can participate, but they must adhere to regulations governing foreign ownership and investment. This includes compliance with the Foreign Investment Law and sector-specific rules.
What role does legal counsel play in M&A transactions?
Legal counsel provides critical support throughout the M&A process, including due diligence, contract negotiation, regulatory compliance, and managing potential legal risks.
Overstaying your visa or KITAS can lead to fines of IDR 1 million per day, and if overstaying persists, deportation and potential blacklisting from Indonesia are possible. It’s important to ensure timely renewals and proper visa management.
To register a foreign marriage in Indonesia, you typically need to submit a marriage certificate issued by the foreign country’s competent authority to the Indonesian Civil Registry Office (Dinas Kependudukan dan Catatan Sipil). Additional documents may be required depending on local regulations. If you do not register it and it has been exceeded by more than 1 (one) year, registration is legally required through the Indonesian court mechanism.
Estate planning in Indonesia involves drafting a will (wasiat) to specify asset distribution and minimize tax implications. Consulting with our legal expert can help you ensure your wishes are legally documented and executed.
No, a Work Permit KITAS requires sponsorship from a legally registered Indonesian company. Foreign companies based outside Indonesia cannot sponsor a KITAS unless they establish a legal presence in Indonesia, such as a PT PMA.
What is a Legal Opinion?
A Legal Opinion is a formal written document from a lawyer that provides legal advice or interpretation on specific legal issues based on the applicable laws and regulations.
When do I need a Legal Opinion?
You need a Legal Opinion when facing complex legal issues, entering contracts, disputes, or when clarity on specific legal points is necessary for business decisions.
What are the typical contents of a Legal Opinion?
A Legal Opinion usually includes an introduction, the legal context, a detailed analysis of the relevant laws, and the lawyer’s conclusions and recommendations.
What areas of law do you provide Legal Opinions on?
We cover various areas, including corporate law, foreign investment, employment law, business disputes, and regulatory compliance in Indonesia.
Are Legal Opinions required for business transactions in Indonesia?
While not always mandatory, Legal Opinions are often requested in such business disputes and major transactions like mergers & acquisitions, or financing to clarify legal risks.
How do Legal Opinions assist foreign investors in Indonesia?
Legal Opinions help foreign investors navigate Indonesian regulations, ensuring their investments comply with local laws and reducing the risk of legal issues.
How long does it take to receive a Legal Opinion?
The timeframe depends on the complexity of the issue, typically ranging from a few days to a couple of weeks.
What is the cost of obtaining a Legal Opinion?
Costs vary based on the complexity of the legal issue and the required research. We offer transparent fee structures after understanding your needs.
Do you provide Legal Advice for startups and new businesses?
Yes, we regularly advise startups and new businesses, particularly regarding compliance, contracts, and foreign investment regulations in Indonesia.
Can Legal Opinions be used in court?
Yes, Legal Opinions can serve as important references or supporting documents during court proceedings or disputes, but they are not legally binding.
There are two types of employment contracts: Fixed-term contracts (Perjanjian Kerja Waktu Tertentu or PKWT) and Indefinite-term contracts (Perjanjian Kerja Waktu Tidak Tertentu or PKWTT). Fixed-term contracts are used for specific time periods or projects, while indefinite-term contracts are open-ended.
