THE REGULATORY DYNAMICS OF SOLE SHAREHOLDER COMPANIES IN INDONESIA: EXAMINING THE CRITERIA FOR MICRO ENTERPRISES AND THEIR LEGAL IMPLICATIONS

This study aims to analyse the regulation of Individual Limited Liability Companies under the current legal framework in relation to micro-enterprise criteria and to formulate a more adaptive and equitable regulatory model for micro-business actors in Indonesia. The establishment of Individual Companies through Law Number 6 of 2023 represents a legal policy intended to facilitate business formalization and improve legal accessibility for micro and small enterprises. However, the existing regulatory framework continues to generate normative issues, particularly concerning inconsistencies among micro-enterprise criteria, capital requirements, administrative obligations, and taxation systems. This research employs a normative legal research method using statutory and conceptual approaches. The analysis examines regulations governing Individual Companies, micro and small enterprises, and taxation through the perspectives of Triadism Law Theory and Development Law Theory. The findings reveal that the current regulation of Individual Companies has not fully accommodated the diverse characteristics of micro-business actors, especially those categorized as livelihood activities within the informal sector, who generally possess limited administrative and financial capacities. This condition potentially creates legal uncertainty, inequity, and reduced legal utility for certain groups of micro-enterprises. Therefore, regulatory reformulation is necessary through the adjustment of micro-enterprise classifications based on business development levels, simplification of administrative and reporting obligations, harmonization with taxation regulations, and enhancement of legal protection and incentives for micro-business actors. Such reformulation is expected to achieve a balance between legal certainty, justice, and utility while supporting sustainable national economic development driven by micro, small, and medium enterprises.