When a shareholder dies, the company does not stop and the shares do not disappear. Under Indonesian civil law, the shares form part of the deceased shareholder’s estate from the moment of death. The heirs may inherit the shares, but the company must still recognise the resulting ownership through its corporate records. This distinction matters because registration affects how shareholder rights are exercised against the company.
Shares as Part of the Deceased Shareholder’s Estate
Under Article 833 of the Indonesian Civil Code (“KUHPerdata”), heirs acquire ownership of a deceased person’s property, rights, and receivables by operation of law at the moment of death. This reflects the saisine principle. Where the Civil Code governs the estate, the entitlement to the shares passes to the heirs by operation of law rather than through an act of the company.
The applicable succession regime still depends on the circumstances of the deceased and the legal framework governing the estate. The Civil Code is not the only source of inheritance law in Indonesia. That regime determines who qualifies as an heir. The company law treatment of the shares must then be considered separately.
Holding an entitlement to the shares is not the same as being recognised by the company as the new shareholder. The heirs acquire the inherited entitlement at death, while recognition in the company’s shareholder records follows a separate corporate process.
How Do Heirs Become Registered Shareholders?
Article 57 of Law No. 40 of 2007 on Limited Liability Companies, as amended by Law No. 6 of 2023, allows a company’s articles of association to impose certain requirements on share transfers. Those requirements generally do not apply when shares pass by operation of law, including inheritance. An exception may apply where the law requires approval from a competent authority in connection with the inheritance. The approval issue is separate from the documents used to establish who the heirs are. Depending on the applicable succession regime, these may include a certificate of inheritance or a court determination of heirship.
Article 52 also addresses shares held by more than one person. Where several heirs become entitled to the same shares, the rights attached to those shares are exercised through one joint representative. The heirs therefore cannot exercise the rights independently before the company while the shares remain jointly held.
For a private company, the resulting change in shareholder composition must be reflected in the company’s corporate records and the applicable administrative filings. Permenkum 49/2025 now governs the relevant corporate administration procedures. The change in shareholder data must be recorded and notified to the Minister through the applicable corporate administration system. Listed shares follow a different administrative process because transfers are handled within the capital-market and securities-custody framework. For public companies, shareholder participation in a GMS may also involve electronic GMS participation through eASY.KSEI. The required procedure and supporting inheritance documents may therefore differ from those applicable to a private company.
What Happens to Shareholder Rights After Death?
Article 52 links the exercise of shareholder rights to registration in the Register of Shareholders. As a result, an heir’s practical ability to exercise voting rights against the company depends on the shares being recorded in the relevant owner’s name. Where several heirs jointly hold the shares, they must also act through a single joint representative. Shareholder voting rights may become particularly relevant when the company holds a General Meeting of Shareholders (“GMS”).
None of this affects the company’s own legal existence. A company continues as a separate legal entity despite changes in its shareholders. The death of a shareholder does not, by itself, dissolve the company or remove its directors or commissioners. If the deceased also served as a director or commissioner, however, a separate corporate process may apply to address the resulting vacancy.
The 2026 succession involving Michael Bambang Hartono illustrates why ownership and corporate recognition should be separated. Michael held a 49% interest in PT Dwimuria Investama Andalan, while Robert Budi Hartono held the remaining 51%. Following Michael’s death, public filings reported that his interest was divided equally among four heirs.
The example also shows why the level at which the shares are held matters. The inherited interest was in the holding company, not a direct transfer of BCA shares to the heirs. BCA’s disclosed ownership structure separately identifies PT Dwimuria Investama Andalan as its controlling shareholder.
Inheritance and shareholder registration are two separate legal steps.
When a shareholder dies, the shares may pass to the heirs under the applicable succession regime, but the change must then be reflected in the company’s shareholder records and applicable corporate administration. Registration is important because it affects the exercise of shareholder rights against the company. The company itself continues as a separate legal entity despite the change in ownership.
