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A Deed of Company Arrangement (DOCA) is a binding agreement between a struggling company and its creditors in Indonesia, offering a structured path to manage debts and avoid bankruptcy. It outlines how the business will pay its debts, continue operations, and potentially restructure under Indonesia's Company Law No. 40 of 2007.

Once approved by creditors and registered with Indonesian authorities, the DOCA helps protect both the company and its creditors. It can include debt reductions, extended payment terms, or business restructuring plans. This legal tool has helped many Indonesian businesses survive financial difficulties while maintaining their relationships with suppliers and stakeholders.

Consider a Deed of Company Arrangement when your Indonesian company faces serious financial difficulties but still has potential for recovery. This solution works best when you need to negotiate with multiple creditors simultaneously and want to avoid the more severe consequences of bankruptcy proceedings under Indonesian law.

It's particularly valuable when your business requires breathing room to restructure operations while maintaining essential supplier relationships. Many Indonesian companies use DOCAs when facing temporary cash flow problems, dealing with substantial debt, or implementing major operational changes. The key is acting early - before creditors initiate formal bankruptcy proceedings through the Commercial Court.

• Basic Debt Restructuring DOCA: Focuses on extending payment terms and reducing debt amounts while maintaining core business operations
• Asset Sale DOCA: Enables structured disposal of company assets to satisfy creditor claims while preserving essential business components
• Operations Restructuring DOCA: Outlines comprehensive business reorganization, including management changes and operational modifications
• Creditor Compromise DOCA: Specifically designed for negotiating different settlement terms with various classes of creditors
• Holding DOCA: Temporarily freezes creditor claims while the company develops a more detailed recovery strategy

• Company Directors: Initiate and negotiate the DOCA terms, remain responsible for implementing agreed restructuring plans
• Creditors: Review, vote on, and become bound by the arrangement's terms for debt repayment or restructuring
• Administrator: Oversees the DOCA process, ensures compliance with Indonesian insolvency laws, and monitors implementation
• Legal Counsel: Drafts the arrangement, ensures compliance with Company Law No. 40/2007, and advises on enforceability
• Shareholders: May need to approve certain DOCA provisions, especially those affecting company structure or ownership

• Financial Assessment: Compile detailed company financials, debt schedules, and cash flow projections
• Creditor Information: List all creditors, amounts owed, security interests, and their contact details
• Business Plan: Prepare a realistic recovery strategy showing how the company will meet DOCA obligations
• Asset Valuation: Document current market value of company assets and potential recovery scenarios
• Legal Requirements: Review Indonesian insolvency laws and ensure compliance with local Commercial Court rules
• Administrator Selection: Choose a qualified administrator registered with Indonesian authorities

• Party Details: Full legal names and addresses of the company, administrator, and all creditors
• Debt Recognition: Clear statement of total debts and individual creditor claims
• Payment Terms: Detailed repayment schedule, amounts, and methods of payment
• Administrator Powers: Specific authority and responsibilities under Indonesian law
• Moratorium Provisions: Terms preventing creditor actions during the arrangement
• Termination Clauses: Conditions for ending or modifying the arrangement
• Creditor Rights: Voting mechanisms and treatment of different creditor classes

A Deed of Company Arrangement differs significantly from an Intercompany Agreement in both purpose and legal effect under Indonesian law. While both documents govern business relationships, they serve distinct functions in corporate operations.

• Purpose: DOCAs specifically address debt restructuring and insolvency situations, while Intercompany Agreements manage ongoing relationships between affiliated companies
• Legal Status: DOCAs require court approval and administrator oversight, whereas Intercompany Agreements are private contractual arrangements
• Binding Effect: DOCAs bind all creditors, even those who vote against it, while Intercompany Agreements only bind the specific companies that sign them
• Duration: DOCAs typically have a defined termination point once debt obligations are met, while Intercompany Agreements often continue indefinitely
• Modification Process: Changes to a DOCA require creditor approval and court oversight, but Intercompany Agreements can be modified by mutual consent of the parties