Batam is now one of Indonesia’s hotspot destinations for investors from all over the world especially its neighboring countries. International investors favor the special economic zone for investing and doing business in Batam due to its many advantages and opportunities.
Located only 30km from Singapore, this region has brought in approximately US$20 billion of investment since the Indonesian government promoted Batam as an industrial area 50 years ago.
In the following article, you will know why Batam has grown in importance as an amazing investment destination for foreign investors, and understand how you can go about registering your company in this prospering special economic zone.
Why Invest in Batam
There are many reasons foreign individuals or foreign companies should invest in Batam:
- To the US market, Batam has the benefit of the Generalized System of Preferences (GSP) because Batam is part of Indonesia
- Batam serves as an entry point for the non-Free Trade Agreement (FTA) and the Comprehensive Economic Partnership Agreement (CEPTA) countries. These countries support the Special Economic Zone and Free Trade Zone
- To the Chinese market, Batam is liable for the ASEAN-China Free Trade Area (ACFTA)
- Inland Free Trade Arrangement that consists of 40% of ASEAN and local products and contents from Batam that can enter most parts of Indonesia encompassing over 269 million population
- Solid infrastructures
- Strategic location to the Straits of Malacca which has the second busiest sea traffic in the world
- Important sea and cargo ports
- The Indonesian government launched one-stop investment services to simplify business setup process in Batam
Company Registration Requirements for Doing Business in Batam
Several ways for foreigners for doing business in Batam are listed below:
Foreign-owned Company (PT PMA)
- 1- 100% foreign ownership depending on the business sectors. The restrictions can be found in the Negative Investment List (soon to be Positive Investment List)
- The minimum paid-up capital is IDR 10 billion
- A business address must be provided before the company registration application submission
- Must have at least one director, two shareholders and one commissioner
- Need to obtain the Deed of Establishment, domicile letter, tax identification number and register the company via the OSS system to obtain a business identification number
Learn more How to Set Up a PT PMA in Indonesia
Local company (PT)
- Only Indonesian nationals can set up a PT. However, a foreigner can set up a PT through Special Purpose Vehicle arrangement with professional shareholders/directors/commissioners
- 100% local ownership
- Must have at least one local director, two shareholders and one commissioner
- Minimum paid-up capital varies based on the size of the company. It ranges from IDR 50 million to IDR 10 billion
- Must obtain Deed of Establishment, domicile certificate, tax identification number, and VAT number for business license and company registration certification
Learn more How to Set Up a Local Company in Indonesia
- It can perform various tasks for its overseas parent company. However, no profit-generating business activities can be conducted
- Considered one of the simplest processes for company registration in Batam
Learn more How to Set Up a Representative Ofice in Indonesia
- Can be purchased and set up easily in the shortest period
- Need to submit necessary information before the incorporation such as professional shareholder data, Memorandum of association and corporate secretary information
Learn more How to Purchase a Shelf Company in Indonesia
Company Registration in Batam with Cekindo
Cekindo provides company registration services for doing business in Batam. As a foreign investor who is new to the market, you can now experience the unique and personalised approach that Cekindo offers to help your business triumph.
Our service offerings are highly powerful and influential and many investors have been regarding Cekindo as a good platform for doing business in Batam.
If you have any questions in mind on how to proceed with the company registration or to start a company in Batam, feel free to contact us.