What is the minimum shareholder requirement to incorporate a PT?

Frequently Asked Questions

Can you have a nominee arrangement when setting up PMA?

A nominee arrangement is an arrangement that uses another person’s name as a subject. In Indonesia, it is prohibited. This restriction aims to prevent situations where a company is owned by one party but beneficially owned by another. According to the law, any nominee agreement between a local party and a foreign investor is deemed null and void.

Can investors own shares with preferential rights?

Under Indonesian Company Law, shareholders can hold shares with various preferential rights, such as voting rights, nomination rights for board members, priority dividend or liquidation proceeds, and options for conversion or withdrawal after a set period.

Is it required to hire Indonesian staff in the PMA company?

In Indonesia, the necessity of hiring Indonesian employees by foreign companies typically arises from commercial requirements, regulatory mandates in specific sectors like construction or shipping, or as part of employing foreigners to fulfill knowledge transfer obligations.

Can Investors 100% own a PT PMA Company?

According to Presidential Regulation No. 10/2021 and the amended version, all businesses are open for domestic and foreign investment with these limitations and classifications:

• Eight businesses are closed to foreign investment and may be operated by the central government.
• Designated business sectors or joint ventures with cooperatives (koperasi) and micro, small, and medium enterprises
• Open businesses are subject to specific conditions, such as those that are exclusively available to 100% local investors, those with restricted foreign shareholding, and investments requiring special licenses

Certain sectors are closed to foreign investment, including narcotics cultivation, gambling, and environmental conservation activities.