PT, CV and what the letters mean.

The forms you will meet.

Almost every Indonesian supplier's name begins with one of these, and buyers read past them without noticing they are there.

PT

Perseroan Terbatas, a limited liability company. Shareholders' liability is limited to their capital. The standard form for anything of scale, and what most exporters are.

PT PMA

A foreign investment company, meaning a PT with foreign ownership. If your counterpart is foreign-owned, this is the form, and it carries its own licensing conditions.

CV

Commanditaire Vennootschap, a partnership with active and silent partners. Smaller, cheaper to establish, and the active partners carry unlimited liability. Common among workshops and small exporters.

UD

Usaha Dagang, a sole trading business. The smallest form, run by an individual, and there is no separation between the business and the person.

Koperasi

A co-operative. A member organisation rather than a company, and the form the Gayo coffee groups and similar agricultural bodies take.

What the form actually tells you.

Scale, roughly. A PT with an export licence is a different proposition from a UD, and neither is a warning sign by itself. Small Indonesian producers are frequently CV or UD and entirely legitimate.

Who you are contracting with. A CV or UD means the individuals behind it carry personal liability, which sounds like an advantage and mostly means the business is small. A PT limits liability to the company, which is what a limited company is for everywhere.

Whether the name matches. This is the useful part: the full legal name including the form is what appears on the registration and on the bank account, and it is what you match against the quotation. A mismatch is the single most common shape of a loss.

What it does not tell you.

Whether they make anything. A PT can be a trading company and a UD can be a workshop with machines. The form describes the legal wrapper rather than the business inside it, and the licensing record is what says what they are permitted to do.

Whether they can export. Export capability is a matter of licensing and registration rather than of legal form, and it is checkable in the licensing system.

Whether they are solvent or competent. Neither is visible from a company type, and both are what an audit and a trading history establish.

Questions buyers ask.

Read next.

• How to verify an Indonesian supplier

  Two public government registries, the cross-check between them that catches most problems before a deposit moves, and the part only a visit can answer.

• How importers lose money in Indonesia

  Six recurring patterns, from credentials that are not export documents to borrowed registrations, and the five checks that catch them.

• Finding a producer in Indonesia

  Six routes to real producers, what each is good for and blind to, and the five-step funnel from a list of names to a first order.

• Buying through a co-operative

  The only practical way to shorten an agricultural chain, and the trade-offs. What a co-operative can and cannot do.

• Reading a supplier's website

  Ten minutes on a supplier's site answers questions before you ask them. Signal, noise and warnings.

• Planning a sourcing trip

  The country is enormous and production is scattered. How to plan a trip worth the flights.

• Trade fairs and sourcing trips

  A stand costs money, which filters some noise and not all of it. How to work a fair and use the week around it.

• Screening who you deal with

  Checking who is on the other side of a transaction is an obligation. What it involves.

• Onboarding a supplier

  Everything to collect before the first order, in the order it is worth collecting it.