Date: Wed, 31 Dec 1997 21:19:31 GMT Server: NCSA/1.5.2 Last-modified: Wed, 22 Oct 1997 15:39:54 GMT Content-type: text/html Content-length: 6399 Joint Ventures





Joint Ventures




Clients List

Ahlstrom, Trafalgar, Diversey, Medifarma, NCH Corporation, Grundfos, Sumitomo Corporation, Newmont, and more.


Pick Your Indonesian Partners

Joint Ventures are common practice in Indonesia where foreign ownership is restricted and limited. The form and scope of these joint ventures are many and varied, ranging from majority ownership by local partners to 'in-name-only' participation to allow foreign concerns to legally manage and operate the Indonesian company.


Get The Deal You Want

Clearly, choosing the right partners and setting up the right agreement is crucial to getting the most out of the joint venture project. All parties involved must thoroughly understand the arrangement and their respective responsibilities to the project and towards each other.



Work Together For Success

The strengths that each member brings to the table will multiply into benefits for all. The proper deal will allow this synergy to grow and gather speed from its own momentum. As the business relationship deepens into a fully functioning organization, both parties will realize the rewards of their commitment to each other and the project.





Let our Experience be your greatest Indonesian Asset !

Alfida Associates, working in conjunction with the Indonesian law firm of Makarim & Taira S., has successfully brought together many foreign and local firms to create powerful and profitable joint venture in the Indonesian business environment. Some notable achievements include: Ahlstrom, Trafalgar, Diversey, Medifarma, NCH Corporation, Grundfos, Sumitomo Corporation, Newmont, etc.


Notes:

In June 1994, the government lifted most requirements for domestic equity and joint ventures. Those who opt for 100% initial ownership are obligated to invest some share, as little as one percent, after 15 years. In certain stategic industries such as power, aviation, railways, water and ports, a minimum of 5% Indonesian shareholding must be maintained.

The choice of an Indonesian joint venture partner is critical for many reasons. For example, the partner can be relied upon for knowledge of the local scene and contacts, which are important for successful operations in Indonesia.

Also, a partnership in Indonesia is difficult to dissolve. Consequently, the first choice has to be the correct choice. It is generally wise to keep in mind that business sense is crucial to any commercial endeavor and, while contracts are important, they are a poor substitute for business skills. A poor choice can be expensive if a free carry of equity or retainer fees have figured in negotiations.

Because Indonesians place great importance on personal relationships and mutual understanding, partnerships tend to be based primarily on genuine accord, with the written contract playing a less significant role. It is therefore important that any agreement is well understood by both sides. A contract over which there are conflicting interpretations is certain to cause future problems.

There are a small number of reference sources and credit check agencies in Indonesia. Banks, advisory companies, the American Chamber of Commerce in Indonesia (AMCHAM), and the Embassy Foreign Commercial Service (World Traders Data Report) can provide some assistance in this area.

In some cases, licensing arrangements for products/services are more cost-effective for U.S. companies doing business in Indonesia, but the same caution mentioned for joint venture partners must also be used.



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