If you own or manage a company in Indonesia, there is a new compliance obligation you should not overlook. The Directorate General of General Legal Administration (Ditjen AHU) under the Ministry of Law has introduced a new administrative mechanism that allows companies to be designated as “Administratively Inactive” (Korporasi Nonaktif) if they fail to keep their corporate information up to date.
The policy, introduced through Circular Letter No. AHU-AH.01-36 of 2026, is part of the Government’s wider effort to improve corporate transparency, strengthen beneficial ownership reporting, and create a more accurate national corporate database.
While the designation does not dissolve a company or revoke its legal status, it can create practical challenges for businesses seeking licences, investment, financing, or corporate changes.
Why Has Indonesia Introduced an “Inactive Company” Status?
Indonesia’s corporate administration has become increasingly digital and interconnected. Information held by the Legal Entity Administration System (SABH) is now integrated with other government platforms, including the Online Single Submission (OSS) system and the Beneficial Ownership (BO) database.
To keep these systems accurate, companies are now expected to regularly update their corporate information whenever administrative changes occur.
According to the Ministry of Law, the policy aims to:
- Improve corporate legal compliance
- Maintain accurate corporate records
- Strengthen good corporate governance
- Increase transparency of company ownership and Beneficial Owners
- Support integrated licensing, verification, and regulatory systems
For investors and business owners, accurate company records also help ensure smoother licensing processes and improve credibility during corporate transactions.
Which Companies Must Update Their Corporate Information?
The new policy applies to all legal entities registered with the Ministry of Law, including:
- Limited Liability Companies (PT)
- Foreign-Owned Companies (PT PMA)
- Foundations (Yayasan)
- Associations (Perkumpulan)
Whenever there is a change to a company’s administrative information, it must be reported electronically through the official Ditjen AHU portal.
Examples include:
- Appointment or reappointment of directors
- Changes to the Board of Directors
- Changes to the Board of Commissioners
- Other corporate administrative amendments required under the Articles of Association or prevailing regulations
Keeping these records current is now considered an essential part of ongoing corporate compliance in Indonesia.
What Happens If You Do Not Update Your Company Data?
The Circular Letter introduces a staged enforcement process rather than immediate sanctions.
Companies that have not updated their corporate information for the previous five years (counted from 12 February 2021) may first be placed on a Temporary List of Inactive Corporations.
The Ministry of Law will publish this list through several public channels, including:
- The official Ditjen AHU website
- National newspapers
- Official social media channels
- Other government communication platforms
If no updates are submitted within six months after the announcement, the company will be transferred to the Permanent List of Inactive Corporations and officially marked as “Nonaktif” within the AHU system.
Does “Inactive” Mean the Company Is Closed?
No. Receiving Inactive (Nonaktif) status does not mean your company has been dissolved or has lost its legal entity status. The company continues to exist legally.
However, the “Nonaktif” label becomes part of the company’s official AHU profile and indicates that it has failed to fulfil its administrative reporting obligations.
Although largely administrative, this status may affect future business activities and interactions with government agencies.
Practical Risks for Businesses
Delays in Corporate Administration
Companies may encounter difficulties when requesting AHU services, such as:
- Changing directors or commissioners
- Updating shareholders
- Amending the Articles of Association
- Completing corporate restructuring
- Processing other legal entity administration requests
These services may be delayed until the company’s information has been updated.
Issues During Investment and Due Diligence
An inactive status can also become a concern during legal due diligence. A “Nonaktif” designation may raise questions regarding corporate governance and delay commercial transactions.
Inconsistencies Across Government Systems
Since AHU records are integrated with OSS and other government platforms, outdated corporate information may create inconsistencies when businesses:
- Apply for business licences
- Update OSS records
- Process operational permits
- Complete regulatory verification
- Manage compliance across multiple government agencies
Keeping corporate information synchronised helps avoid unnecessary administrative obstacles.
Beneficial Ownership Reporting
The Circular Letter also reinforces Indonesia’s Beneficial Ownership (BO) reporting obligations.
Companies are required to maintain accurate BO information through the official AHU BO platform. Failure to do so may result in progressive sanctions under Minister of Law Regulation No. 2 of 2025, including:
- Written warnings
- Inclusion on a government blacklist
- Suspension of access to AHU electronic services
Submitting inaccurate Beneficial Ownership information may also lead to further administrative action.
A Reminder for Business Owners
Many entrepreneurs focus on establishing a company but pay less attention to maintaining it.
As Indonesia continues strengthening its digital governance framework, ongoing compliance has become just as important as incorporation itself. Regularly reviewing company records can help businesses avoid unnecessary regulatory issues and remain ready for future expansion, fundraising, or licensing applications.
Business owners should periodically review:
- Directors and commissioners
- Shareholder records
- Articles of Association
- Beneficial Ownership reporting
- OSS licences and business permits
- Corporate administrative records
Read the full article here: Update AHU Corporate Data or Risk Being Declared Inactive
Stay Updated with Indonesia’s Business Regulations
Indonesia’s business regulations continue to evolve as the Government strengthens corporate governance, investment supervision, and digital administration.
Whether you are establishing a PT PMA, expanding your operations, or simply ensuring your company remains compliant, staying informed about regulatory developments is essential.
For personalised advice on corporate compliance, business licensing, immigration, or tax obligations in Indonesia, Lets Move Indonesia – subsidiary of LMI Consultancy provides comprehensive support to both local entrepreneurs and foreign investors throughout every stage of the business lifecycle.
Stay informed with the latest immigration, business, and tax updates from Indonesia, and ensure your company remains compliant in an increasingly connected regulatory environment.
