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:
Minimum wages are set by the government and vary by region. Employers must ensure that wages paid to employees are at least equal to the regionally established minimum wage. Failure to comply can result in sanctions and penalties.
What are common challenges in legal due diligence in Indonesia?
Challenges include navigating complex regulatory environments, language barriers, and ensuring comprehensive access to relevant documents and information.
How can your firm assist with legal due diligence?
Our firm provides expert legal due diligence services by meticulously reviewing and analyzing all pertinent legal documents and compliance matters, offering insights and recommendations to support your business decisions.
How does legal due diligence impact negotiations?
Findings from due diligence can influence the terms of negotiations, including price adjustments, indemnity clauses, or changes in deal structure to address identified risks.
What are the potential risks of skipping legal due diligence?
Skipping due diligence can lead to unforeseen legal liabilities, compliance issues, and financial losses. It may also affect your ability to make informed decisions or negotiate favorable terms.
Can legal due diligence be customized based on the industry?
Yes, due diligence can be tailored to address industry-specific risks and regulations, such as those relevant to manufacturing, technology, or financial services.
How is confidentiality maintained during the due diligence process?
Confidentiality is ensured through strict internal controls, non-disclosure agreements, and secure handling of sensitive information throughout the review process.
What are the costs associated with legal due diligence?
Costs vary depending on the scope and complexity of the review. We provide transparent pricing and detailed cost estimates based on your specific needs.
Can due diligence findings be used in future legal proceedings?
Yes, findings can be used as evidence in legal disputes or regulatory matters, helping to support your case or demonstrate compliance.
What happens after the due diligence process is completed?
After completion, we provide a detailed report summarizing findings, potential risks, and recommendations. We also offer guidance on addressing any issues identified.
Is legal due diligence required for all types of transactions?
While not always mandatory, due diligence is highly recommended for major transactions such as mergers & acquisitions, or investments to mitigate risks and ensure informed decision-making.
What types of cases are handled by Indonesian State Administrative Courts (PTUN)?
The cases involve disputes over administrative decrees, including issues related to business permits, licenses, regulatory compliance, issuance of land certificate, land use regulations, administrative sanctions imposed by Indonesian government agencies, etc.
What are the conditions for a state administrative decree to be disputed in Indonesian State Administrative Court (PTUN)?
The state administrative decree shall be written decision; issued by a State Administrative Agency Office; constituting an act of state administrative law; based on relevant legal regulations; concrete, individual, and final; and generating legal consequences for an individual or legal entity.
What are the grounds for challenging an administrative decision in Indonesian State Administrative Courts?
Common grounds for challenging administrative decisions include procedural errors, violations of statutory rights, lack of legal basis, decisions that are deemed unlawful or unfair, etc.
What happens if I miss the 90-day deadline to file a lawsuit in Indonesian State Administrative Courts?
Missing the 90-days deadline to file a lawsuit can result in the case being dismissed due to procedural non-compliance. It is crucial to adhere to statutory deadlines to avoid potential legal obstacles.
No, these KITAS types are for business or employment purposes only. If you plan to study in Indonesia, you would need to apply for a Student KITAS, which is specifically designed for education.
Company Regulations is internal rules established by the employer to govern the rights and obligations of both parties. They provide structure on issues such as working conditions, disciplinary actions, leave policies, and other employment terms. The regulations must align with the legal framework and be reviewed every two years. This regulation must be registered and approved by the Indonesian Ministry of Manpower.
What is a tax dispute, and how does it arise in Indonesia?
A tax dispute occurs when there is a disagreement between the taxpayer and the Indonesian Tax Authorities (Direktorat Jenderal Pajak, DJP) regarding tax assessments, tax payments, or the interpretation of tax regulations. Disputes commonly arise after a tax audit when the taxpayer disagrees with the findings of the DJP.
How does a tax audit work?
During a tax audit, the tax authority reviews your financial records and tax filings to ensure compliance. If discrepancies are found, they will issue a notice of their findings.
What can I do if I disagree with a tax audit’s findings?
You can file a Tax Objection within three months of receiving the audit results. This is your formal request for the tax authority to re-examine their decision.
What happens if my Tax Objection is rejected?
If your objection is rejected, you can escalate the matter by filing a Tax Appeal with the Tax Court within three months of receiving the rejection.
What is a Tax Lawsuit?
A Tax Lawsuit challenges administrative actions by the tax authority that are unrelated to assessments, such as disputes over tax refunds or collections.
When can I file a Tax Judicial Review?
A Tax Judicial Review is the final legal step, brought before the Supreme Court to correct substantial legal errors made by the Tax Court. This is done only after exhausting all other avenues.
Can I resolve a tax dispute without going to court?
While negotiation is possible, formal out-of-court settlements are rare in Indonesian tax disputes. Our professional advice is crucial to exploring your options.
What are the typical outcomes of a tax objection?
The outcomes of a tax objection can be varied. The tax authority may fully accept, partially accept, or reject your objection, depending on the strength of your argument and evidence provided.
How long does it take to receive a decision on a Tax Objection?
The tax authority typically takes 12 months from the date of filing to issue a decision on a Tax Objection. If no decision is made within this time, the objection is considered rejected by law.
Can I settle my tax liabilities during the dispute process?
Yes, settling your tax liabilities during the dispute process is possible. However, this may impact the progression of the dispute. Consulting with a tax professional like our firm is advised before making any settlement decisions.
What are the common reasons for a Tax Judicial Review?
Common reasons for a Tax Judicial Review include substantial legal mistakes in the lower courts’ rulings, misinterpretation of tax laws, or procedural violations that affected the fairness of the judgment.
What penalties can I face in a tax dispute?
Penalties can include fines, interest charges, and administrative sanctions depending on the nature of the dispute. If a tax deficiency is found, additional penalties may apply for late payments or underreporting.
What is the time limit to file a Tax Lawsuit?
A Tax Lawsuit must be filed within 90 days of the administrative action you are challenging (such as a refusal of a refund). Missing this deadline can result in the dismissal of your lawsuit.
What types of administrative decisions can be challenged through a Tax Lawsuit?
You can challenge decisions such as denial of tax refunds, incorrect tax collections, or penalties imposed outside of a tax assessment.
What happens if I win a Tax Appeal or Tax Lawsuit?
If you win, the court may order the tax authority to revise or cancel their previous decision. This could result in a refund, removal of penalties, or a corrected tax assessment.
Can I request an extension for filing a Tax Objection or Tax Appeal?
No, deadlines for filing Tax Objections and Tax Appeals are strictly enforced under Indonesian tax law.
What is the burden of proof in a tax dispute?
In Indonesian tax disputes, the burden of proof lies with the taxpayer. You must provide evidence and documentation that supports your claim against the tax authority’s assessment or decision.
What happens if I fail to provide sufficient evidence in a Tax Objection or Tax Appeal?
If you fail to provide enough evidence, the tax authority or the Tax Court may rule in favor of the government. Therefore, it is crucial to present a well-prepared and substantiated case.
What is the impact of a Tax Dispute on my business operations?
While a tax dispute is ongoing, it may cause financial uncertainty. However, unless there are severe violations, the tax authority generally does not halt business operations during the dispute. Consulting with tax professionals like our firm can help mitigate risks.
Can I negotiate with the tax authority before filing an objection or appeal?
Informal negotiations or discussions can sometimes lead to clarification or resolution before entering the formal dispute resolution process. However, once a decision has been made, formal procedures are required to challenge it.
When should I apply for a tax ruling?
You should consider applying for a tax ruling when you face complex or unclear tax issues that could impact your business decisions. A tax ruling can provide you with the necessary legal certainty before you proceed.
What types of tax facilities are available in Indonesia?
Indonesia offers various tax facilities, including tax holidays, reduced tax rates, and exemptions, designed to encourage investment and business activities in certain sectors or regions. These facilities can significantly reduce your tax burden.
How do I know if my business qualifies for tax facilities?
Our team conducts an eligibility assessment based on your business activities and the criteria set by the Indonesian government. We identify the most beneficial tax facilities that apply to your situation.
What documents are required for a tax ruling application?
Typically, you’ll need to provide a detailed description of the tax issue, legal arguments, and any supporting evidence. We help you prepare all the necessary documentation to ensure a strong application.
How long does it take to get a tax ruling in Indonesia?
The processing time for a tax ruling can vary depending on the complexity of the issue and the workload of the tax authorities. On average, it may take several weeks to a few months.
What happens if my application for tax facilities is approved?
Once approved, you must comply with the conditions set by the tax authorities to maintain the benefits. We provide ongoing support to ensure you meet these requirements and continue to benefit from the tax facilities.
Are tax rulings legally binding in Indonesia?
Yes, once issued, tax rulings are legally binding for both the taxpayer and the tax authorities. They provide a clear legal framework for how the relevant tax laws will be applied to your specific case.
How does the Indonesian government decide who gets tax facilities?
Tax facilities are granted based on specific criteria set by the government, which may include the type of business activity, the investment amount, the region of operation, and the expected economic impact.
What is the difference between a tax ruling and a tax opinion?
A tax ruling is an official decision from the tax authorities, whereas a tax opinion is a professional interpretation provided by a tax advisor. While a tax opinion can guide you, a tax ruling offers legal certainty from the government.
Can tax facilities be revoked once granted?
Yes, tax facilities can be revoked if the business fails to comply with the conditions set by the tax authorities. Regular compliance and reporting are essential to maintaining these benefits.
Failure to register a foreign marriage in Indonesia may lead to not having a legal standing and complications in legal matters such as property ownership and inheritance matters. It is important to ensure proper registration to secure legal recognition and rights in Indonesia.
