The Rapat Umum Pemegang Saham (RUPS) is one of the governing bodies of a Limited Liability Company (PT), authorized to make key corporate decisions.
Under Law No. 40 of 2007 concerning Limited Liability Companies (Company Law), different RUPS agendas are subject to different quorum and voting requirements.
Two key elements determine the validity of a RUPS resolution:
• Attendance Quorum: The minimum percentage of voting shares that must be present or represented at the meeting.
• Voting Approval: The minimum percentage of votes required to approve a resolution.
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1. RUPS Quorum and Voting Requirements
The following table summarizes the requirements for the first RUPS under Indonesian Company Law.
| RUPS Agenda | Attendance Quorum | Voting Approval |
| Appointment and dismissal of Directors/Commissioners | >50% | >50% |
| Approval of annual reports and financial statements | >50% | >50% |
| Dividend distribution and allocation of profits | >50% | >50% |
| Increase of issued and paid-up capital within authorized capital | >50% | >50% |
| Amendments to the Articles of Association | ≥2/3 | ≥2/3 |
| Increase of authorized capital | ≥2/3 | ≥2/3 |
| Capital reduction | ≥2/3 | ≥2/3 |
| Share buyback | ≥2/3 | ≥2/3 |
| Debt-to-equity conversion through set-off of claims | ≥2/3 | ≥2/3 |
| Transfer or encumbrance of assets exceeding 50% of net assets* | ≥3/4 | ≥3/4 |
| Merger, consolidation, acquisition, and spin-off | ≥3/4 | ≥3/4 |
| Company dissolution | ≥3/4 | ≥3/4 |
| Voluntary bankruptcy petition | ≥3/4 | ≥3/4 |
| Extension of the company’s duration | ≥3/4 | ≥3/4 |
| Circular resolution (resolution outside a RUPS) | Not applicable | 100% of shareholders with voting rights |
The transfer or encumbrance of assets carried out in the ordinary course of the company’s business activities, as provided in its Articles of Association, may be exempt under Article 102(3) of the Company Law.
Note: Voting approval percentages are calculated based on the votes cast at the RUPS, rather than the company’s total issued shares. The requirements above apply unless the Articles of Association prescribe higher thresholds.
2. Quorum Requirements for the First, Second, and Third RUPS
If the attendance quorum is not satisfied at the first RUPS, the Company Law permits a second RUPS with a lower attendance threshold.
| Resolution Category | First RUPS | Second RUPS | Third RUPS | Voting Approval |
| Ordinary resolutions | >50% | ≥1/3 | Determined by the District Court | >50% |
| Amendments to the Articles of Association | ≥2/3 | ≥3/5 | Determined by the District Court | ≥2/3 |
| Major corporate resolutions | ≥3/4 | ≥2/3 | Determined by the District Court | ≥3/4 |
Importantly, the reduced quorum requirement for the second RUPS applies only to attendance, not to the voting approval threshold.
Therefore, even when fewer shareholders are required to attend the second RUPS, the resolution must still obtain the applicable percentage of votes cast.
3. Key Takeaways
Under Indonesian Company Law, RUPS resolutions generally fall into three main categories:
1. Ordinary Resolutions: More than 50% attendance quorum and voting approval.
2. Amendments to the Articles of Association: At least 2/3 attendance quorum and voting approval.
3. Major Corporate Resolutions: At least 3/4 attendance quorum and voting approval.
Accordingly, holding a majority of shares does not automatically grant a shareholder the authority to approve every corporate resolution unilaterally.
The validity of each resolution must be assessed based on the agenda, attendance quorum, voting approval threshold, and the company’s Articles of Association.
Disclaimer: This article provides general legal information based on Law No. 40 of 2007 concerning Limited Liability Companies. Its application should take into account subsequent legislative amendments, the company’s Articles of Association, and any applicable sector-specific regulations.
