Document background
The Equity Investment Agreement serves as the primary transaction document for equity investments in Indonesian companies, whether through direct share subscription or capital increase. It is essential for both domestic and foreign investments, requiring careful consideration of Indonesian investment regulations, including foreign ownership restrictions in certain sectors. The agreement typically follows after initial term sheet negotiations and due diligence, incorporating necessary protections for investors while ensuring compliance with Indonesian corporate law requirements. It must address specific local requirements such as dual-language execution (Bahasa Indonesia and English), necessary regulatory approvals from the Investment Coordinating Board (BKPM), and alignment with Indonesia's Negative Investment List regulations. The document is crucial for establishing clear governance structures, investor protections, and exit mechanisms while maintaining compliance with local regulatory frameworks.
