Company Legality: Key Steps to Building Reputation and Trust
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Company-Legality

START NOW – Company legality is a crucial step that every business must take. This process ensures that the company operates in accordance with applicable laws and regulations.

By taking care of the company legality correctly, the company can operate safely. Furthermore, it will also have good reputation in the eyes of public. 

What is Company Legality?

What is Company Legality?

Legality refers to the state in which an action, process, or entity complies with applicable laws, especially within a company. 

This means that all operational and structural aspects of the company have complied with applicable legal rules and regulations.

This includes the fulfillment of obligations such as tax reporting, protection of intellectual property rights, and compliance with labor laws.

Legality is very important in the business world. It is protecting the company from adverse legal consequences and ensuring legal compliance. 

In addition, legality can also build a positive reputation in the eyes of customers and stakeholders. This will bring positive impact for the company’s growth. 

Companies that operate legally and in compliance with the law have an advantage in gaining access to wider business opportunities.

That means, a good legality management is not only a legal obligation, but also a smart business strategy. 

By maintaining regulatory compliance, companies can also reduce unnecessary operational risks and focus on growth and innovation. 

In addition, solid legality also strengthens a company’s foundation to grow sustainably and expand in a competitive business environment. 

As such, investing in legality management can provide significant long-term benefits to a company’s growth and stability.

Company Legality Management: 7 Must-Have Documents

Company Legality Management: 7 Must-Have Documents

Company legality management involves a number of important documents that must be in place and well-maintained by the company. 

Here are seven important documents every company must have to ensure they operates legally and in compliance with the law:

Deed of Establishment

The deed of establishment is the basic document required to establish a company. 

This document contains some crucial information, such as:

  • information about the founders of the company, 
  • the type of business to be run,
  • the authorized capital of the company. 

The deed of establishment must be notarized and registered with the Ministry of Law and Human Rights (Kemenkumham).

Business Identification Number (NIB)

NIB or Nomor Induk Berusaha is a company identity issued by the OSS (Online Single Submission) Agency. 

Furthermore, NIB also functions as a Company Registration Certificate (TDP), Importer Identification Number (API), and customs access. 

So, it is very important for companies that carry out import activities to have it. 

Trade Business License (SIUP)

SIUP (Surat Izin Usaha Perdagangan) is a license that must be owned by every company that conducts trading activities. 

SIUP is issued by the local Trade Office and includes information on the type of goods or services being traded.

Company Registration Certificate (TDP)

TDP (Tanda Daftar Perusahaan) is proof that a company has been officially registered at the company registration office. 

By having it, the company is considered legitimate in the eyes of the law. So, it has the right to carry out its operational activities.

Company Taxpayer Identification Number (NPWP)

NPWP (Nomor Pokok Wajib Pajak) is a tax identification number that every company must have to complete company legality aspect. 

NPWP is required to fulfill the company’s tax obligations, such as income tax payment and annual tax reporting.

Location Permit and IMB (Building Construction Permit)

Location permit and IMB are required if the company has its own building to run its operations activities.

The location permit ensures that the business location is in accordance with the land allocation regulated in the spatial plan. 

Meanwhile, IMB is a permit required to construct or renovate a company building.

BPJS Employment and BPJS Health Certificates

Companies are required to register their employees in social security programs organized by BPJS Ketenagakerjaan and BPJS Kesehatan. 

This certificate proves that the company has complied with its obligation to provide social protection to its employees.

Benefits of Company Legality

Benefits of Company Legality

Company legality is not only a legal obligation, but also provides a number of strategic benefits for business growth. 

Here are some of the key benefits of obtaining company legality:

Legal Protection

By having complete and valid legality documents, the company will be protected from legal risks that may arise. 

Legality provides a strong legal basis for the company to operate So, the risk of legal disputes with third parties can be overcome. 

Trust and Credibility

Law-abiding companies tend to be more trusted because they are perceived as professional and committed to high ethical standards.

That means, company legality will increase company’s credibility in the eyes of customers, business partners and investors. 

Ease of Capital Access

Complete legality makes it easier for companies to gain access to various sources of funding, both from banks and investors. 

Banks and investors tend to provide funding to companies that have a clear and organized legal basis.

Ease of Business Expansion

Companies that have taken care of their legality properly will find it easier to expand their business. 

Clear legality makes it easier for companies to fulfill legal requirements in new regions, even to the international realm. 

Tax Advantages and Government Incentives

Companies that pay taxes and comply with tax regulations can get various incentives from the government, including:

  • Tax deductions
  • Capital assistance
  • Other support programs

Efficient Operations

By taking care of legalities, companies can run their operations more efficiently and focus on business development. 

Well-organized legality minimizes distractions from legal and regulatory aspects, allowing the company to concentrate on its main business objectives.

Protection of Company Assets and Wealth

Good legality can also provide strong protection for the company’s assets and wealth from unfounded third-party claims. 

In addition, with clear legality, companies can more easily manage their intellectual property rights, such as trademarks, patents, and copyrights.

Legality serves not only as compliance with the law, but also as a strong foundation for business development and sustainability. 

Considering its benefit, It is very important for every business owners not to neglect to take care of its existence.

By understanding and fulfilling the applicable company legality requirements, companies can enjoy a range of significant benefits. 

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