Shareholders of a company can remove or terminate a director or commissioner in a company. Shareholders vote on these during the general meeting of shareholders. Note that terminating a director or commissioner follows a strict process.
How to Terminate a Director or Commissioner in Indonesia
Letter of termination Shareholders must provide a reason for the termination of the director or commissioner.
Hearing There will be a hearing so the director or commissioner can defend himself or herself.
Statement letter The letter must state that the director or commissioner had the opportunity to defend himself or herself.
A director or commissioner may immediately accept their termination, in effect, resigning from the post. To do this, they must sign a statement letter upon receipt of the termination letter. In such cases, the hearing will no longer be necessary.
How to Avoid Termination of a Director or a Commissioner
Given the strict process to terminate a director or commissioner, some companies may opt to avoid this process altogether. Below are two alternatives to avoid terminating a director or commissioner in Indonesia.
#1 Nominate a resident director or commissioner from VIVO ASIA
One option is to appoint a commissioner or director from VIVO ASIA. We will provide you with a resignation letter in advance. This allows shareholders to end the company’s relationship with the appointed person without doing the process.
Our team has a good understanding of corporate regulations, employment laws, tax compliance, and the like. As such, we would also be able to assist with the tasks and responsibilities of a director or commissioner.
#2 Limit the term of office
Another option is to specify a term limit in your company’s articles of association. It is possible to set a maximum term period for directors and commissioners. Directors and commissioners must vacate the role upon reaching the maximum term. There will be no need to go through the termination process.
You can set the maximum term period for as short as one year and as long as five years.
VIVO ASIA provides director and commissioner services in Indonesia. Our consultants are ready to assist you with your concerns related to the corporate structure in Indonesia. Get in touch with us by filling out the form below. You can also send an email to