The transfer of foreign workers (TKA) from one company to another within the same business group is relatively common, particularly among multinational companies (MNCs) with multiple entities in Indonesia. Such transfers may involve changes in payroll, position, reporting lines, or the placement of a foreign worker from one group entity to another.
From an immigration perspective, however, such a transfer is not merely an internal group matter. Where the transfer results in a change in the party acting as the foreign worker’s ITAS sponsor, the transfer should, in principle, be processed as an ITAS sponsor transfer in accordance with the applicable immigration procedures.
Accordingly, the fact that two companies belong to the same business group does not, by itself, make them a single sponsor from an immigration law perspective. Each legal entity remains a separate legal subject and has its own responsibilities as the sponsor of the foreign national.
ITAS Sponsorship as a Specific Legal Responsibility
Under Indonesia’s immigration regime, a sponsor or guarantor is not merely the party whose name appears on the foreign national’s residence permit documentation. The sponsor assumes legal responsibilities in relation to the foreign national’s presence and activities in Indonesia.
Government Regulation No. 31 of 2013, as amended by Government Regulation No. 48 of 2021, regulates the obligation of certain foreign nationals to have a sponsor. The regulations also impose responsibilities on sponsors in relation to the presence and activities of the foreign nationals they sponsor.
Consequently, if a foreign worker transfers from PT A to PT B while PT A remains listed as the sponsor on the ITAS, there may be a discrepancy between the factual circumstances and the immigration records if PT B has become the entity actually employing or assuming responsibility for the foreign worker.
This becomes increasingly relevant where the transfer is also accompanied by changes in position, duties, payroll, or the underlying employment authorization.
Sponsor Transfers Between Companies Within the Same Group
Transfers of sponsorship between companies within the same business group are, in principle, recognized within the immigration framework governing sponsor transfers.
This category may also cover relationships between companies that have a close business relationship, including relationships based on complementary products, as well as business entities involved in the implementation of government projects based on recommendations from the relevant authorities.
Accordingly, being part of the same business group may provide a basis for an ITAS sponsor transfer, but it does not eliminate the requirement to complete the sponsor transfer process itself.
It is important to distinguish between a corporate relationship and sponsor status under immigration law. A relationship as a parent company, subsidiary, affiliate, or sister company does not automatically allow one company to act as the sponsor of a foreign worker who is legally under the responsibility of another company.
Sponsor Transfer Through the Issuance of a New ITAS
One important aspect of a sponsor transfer is its legal effect on the existing ITAS.
Minister of Justice Decision No. M.02-IZ.01.10 of 1995, as amended by Minister of Law and Human Rights Regulation No. M.HH-08.GR.01.06 of 2009, in principle provides that where an ITAS holder changes sponsor or position, the ITAS is granted through the issuance of a new ITAS as a continuation of the previous ITAS, without reducing the period of stay already granted.
Accordingly, an ITAS sponsor transfer should not be understood merely as an administrative change to an immigration database or internal record. From an immigration law perspective, a change of sponsor has legal consequences for the relevant residence permit.
Therefore, when a company decides to transfer a foreign worker from PT A to PT B, the corporate decision should be followed by the appropriate immigration process to ensure that the ITAS and sponsor information are aligned with the new circumstances.
Procedures and Documents to Be Prepared
An application for a sponsor transfer may, in principle, be submitted by the foreign national concerned, the new sponsor, or their authorized representative to the Immigration Office having jurisdiction over the foreign national’s place of residence.
The documents that should be considered include:
- a request and guarantee letter from the new sponsor;
- a valid passport or travel document;
- the existing ITAS; and
- other supporting documents as required.
For transfers of foreign workers between companies, employment-related matters should also be aligned with the immigration process. The new sponsor should ensure that the foreign worker’s placement with the new entity is supported by the appropriate employment authorization, including the RPTKA and other relevant documents where required.
In addition, corporate documents of both the former and new sponsors are important to demonstrate the existence of each entity and the legal relationship supporting the sponsor transfer. In the context of a business group, such documents may be used to demonstrate that the two companies belong to the same group or otherwise satisfy the relevant category of business relationship.
In practice, companies should also be prepared to provide supporting documents concerning corporate legality and business activities, as well as relevant employment documents, if requested during the examination process.
The Consent of the Existing Sponsor Remains Relevant
One aspect that is often overlooked in practice is the position of the existing sponsor.
In the sponsor transfer process, a statement of no objection from the existing sponsor is an important document. This demonstrates that the sponsor transfer is not merely a unilateral decision by the new sponsor or the foreign worker, even where both companies belong to the same business group.
From a compliance perspective, companies should ensure that internal processes relating to termination, transfer, secondment, or changes in the employment relationship have been properly completed at the corporate level and subsequently reflected in the immigration documentation.
This ensures consistency between the company’s corporate decision, the employment relationship, employment authorization, and the sponsor status reflected in the ITAS.
Aligning the ITAS with Employment Authorization
An ITAS sponsor transfer cannot be separated from employment-related considerations.
For example, a foreign worker may previously have been employed by PT A under an RPTKA supporting their placement with PT A. If the foreign worker is subsequently transferred and begins working for PT B, the company should ensure that the underlying employment authorization is properly aligned with the new structure.
Issues may arise where a company only updates its employment administration, such as payroll, employment agreements, BPJS, or tax registration, without updating the ITAS sponsor and relevant employment authorization.
In such circumstances, there may be a mismatch between:
the entity actually employing the foreign worker → employment authorization → ITAS sponsor.
These three elements should ideally remain consistent.
This is important because a foreign national’s residence permit must be used in accordance with the purpose for which it was granted. Changes in employment or sponsorship may also constitute information that must be reported in accordance with applicable immigration requirements.
Common Mistakes in Intra-Group Foreign Worker Transfers
In corporate practice, several approaches may potentially create compliance issues.
First, companies may assume that being part of the same group means having a single sponsor. From a corporate perspective, several companies may belong to the same group, but each remains a separate legal entity. Sponsor status must be assessed based on the entity that legally acts as the sponsor, rather than the business group as a whole.
Second, companies may implement changes to payroll, position, or reporting lines without updating the ITAS sponsor. Such internal changes may create inconsistencies between the foreign worker’s actual activities and the information reflected in their residence permit.
Third, companies may complete the transfer from an employment and tax perspective only, while failing to update the immigration status. Updating the employment agreement, BPJS, payroll, or tax registration with the new company does not, by itself, change the sponsor stated on the ITAS.
Fourth, companies may use a visit visa or business visa for activities that, in substance, constitute employment or operational assignments with the new entity. The immigration status used by a foreign national must remain consistent with the purpose and nature of their activities in Indonesia.
These issues generally arise from treating a foreign worker transfer solely as a corporate HR movement, when a change of employing entity may simultaneously have implications for employment, immigration, licensing, and regulatory compliance.
Risks of an Inconsistent ITAS Sponsor
Where the sponsor stated on an ITAS does not correspond to the actual circumstances, both the company and the foreign worker may face immigration-related risks.
Indonesia’s Immigration Law, in principle, requires foreign nationals to remain in Indonesia under a residence permit that corresponds to the purpose and objectives of their stay. The use of a residence permit in a manner inconsistent with its intended purpose may result in consequences under the applicable immigration sanctions.
From the sponsor’s perspective, an inconsistency may also raise questions concerning the fulfillment of the sponsor’s responsibilities in relation to the foreign worker’s presence and activities.
Accordingly, the key issue is not merely whether the transfer is “permitted,” but whether the entire documentary chain identifies the correct entity as the employer, sponsor, and entity holding the appropriate authorization to employ the foreign worker.
Key Considerations
When transferring a foreign worker between companies within the same business group, companies should consider the following:
- Treat the transfer as a formal immigration matter. A transfer from one entity to another that results in a change of sponsor should be processed as an ITAS sponsor transfer, rather than treated solely as an internal group reassignment.
- Establish the relationship between the entities. Corporate documents of the existing and new sponsors should demonstrate the group relationship, ownership structure, or business relationship supporting the sponsor transfer.
- Obtain the existing sponsor’s consent. A statement of no objection from the existing sponsor should be prepared as part of the sponsor transfer documentation.
- Align employment and immigration authorizations. The RPTKA and other relevant employment authorizations should be aligned with the new sponsor to avoid inconsistencies between employment authorization and immigration status.
- Update the immigration status. Changes in sponsor, employment, and other relevant information should be properly reflected in the foreign worker’s immigration status.
- Coordinate the corporate transition. Termination, transfer, secondment, payroll, employment agreements, tax matters, and corporate documentation should be coordinated with the immigration process.
Ultimately, being part of the same business group does not eliminate the principle that each legal entity has its own legal standing and responsibilities as a sponsor. Accordingly, the transfer of a foreign worker from PT A to PT B should be treated as a cross-functional process connecting corporate structure, employment arrangements, immigration status, and regulatory compliance.
How TAMA Global Mobility Can Assist
- Immigration Status Assessment, assessing whether a proposed transfer constitutes a change of immigration sponsor and identifying the appropriate immigration process.
- ITAS Sponsor Transfer, assisting with the preparation and coordination of the formal ITAS sponsor transfer process.
- Group Company Structuring, reviewing the corporate relationship between the existing and new sponsors and the documentation supporting the transfer.
- Employment & Immigration Alignment, coordinating immigration requirements with the RPTKA and other employment-related authorizations applicable to the new sponsor.
- Immigration Compliance Review, identifying potential inconsistencies between the foreign worker’s actual employment arrangement, work authorization, and immigration status.
- Corporate Mobility Advisory, advising MNCs and corporate groups on intra-group foreign worker transfers, secondments, and changes in employment structures.
TAMA Global Mobility assists foreign companies and corporate groups in navigating Indonesia’s immigration and employment framework through a structured approach to global mobility, corporate licensing, and regulatory compliance.
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TAMA Global Mobility
WhatsApp: +62 821-1015-402
Email: info@tamaglobalmobility.com
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Entering the Indonesian Market: PT PMA, Representative Office or Permanent Establishment?
Immigration Compliance for Foreign National Heads of KPPA in Indonesia
Permanent Establishment (BUT) in Indonesia: A Guide for Foreign Companies
