Positive Investment List in Indonesia: Open Sectors Guide

Indonesia’s Positive Investment List determines which business sectors foreign investors can enter, where 100% foreign ownership is permitted, and which activities remain restricted.

Established under Presidential Regulation (Perpres) 10/2021 and amended by Perpres 49/2021, the framework replaced Indonesia’s former Negative Investment List with a more open approach to foreign investment.

However, a sector being open to foreign investment does not automatically mean a foreign investor can establish and operate a business without additional conditions. Before setting up a PT PMA, investors must consider ownership limits, investment capital, business classification (KBLI), and licensing requirements.

Understanding these rules helps foreign investors identify viable opportunities, structure their investments correctly, and avoid costly changes during market entry.

Key Takeaways

• Indonesia’s Positive Investment List generally opens business activities to foreign investment unless applicable regulations restrict, reserve, or close them.
• Foreign investors can hold up to 100% ownership in many sectors, subject to sector-specific restrictions and licensing conditions.
• Certain activities require partnerships with Indonesian cooperatives or MSMEs, while others have foreign ownership caps.
• PT PMA investors generally need at least IDR 2.5 billion in paid-up capital and an investment plan exceeding IDR 10 billion per applicable KBLI and project location, subject to regulatory exceptions.
• Selecting the correct KBLI classification is essential for determining ownership eligibility, investment requirements, and OSS business licensing.

Indonesia’s Positive Investment List at a Glance

The Positive Investment List classifies business fields by investment eligibility, ownership conditions, and potential incentives.

Investment Category	Foreign Investment Eligibility
Priority business fields	Generally open, with potential fiscal or non-fiscal incentives
Reserved for cooperatives and MSMEs	Generally unavailable for direct foreign investment
Open through MSME partnerships	Permitted with qualifying partnership arrangements
Business fields with specific requirements	Subject to foreign ownership limits or other investment conditions
Closed business fields	Not open to new investment under applicable restrictions
Other business fields	Generally open, subject to sector-specific requirements

The list provides the starting point for an investment decision. Investors must also assess actual eligibility against current licensing rules and the company’s intended commercial activities.

What Has Changed in Indonesia’s Positive Investment List?

Although Perpres 10/2021, as amended by Perpres 49/2021, remains the governing framework for Indonesia’s Positive Investment List in 2026, several subsequent regulations have changed how foreign investors establish and operate businesses.

Regulatory Update	What Changed	Impact on Foreign Investors
PP 28/2025	Replaced PP 5/2021 and updated risk-based business licensing requirements.	Investors must follow the updated OSS licensing framework for their intended activities.
BKPM Regulation 5/2025	Reduced the general minimum paid-up capital requirement for PT PMA from IDR 10 billion to IDR 2.5 billion.	Investors have a lower paid-up capital threshold, although total investment must generally exceed IDR 10 billion.
KBLI 2025	BPS introduced updated business activity classifications under Regulation 7/2025.	Investors must confirm that their business activities match the applicable KBLI classifications and licensing requirements.
Tax holiday developments	The application deadline under the previous corporate income tax reduction scheme was 31 December 2025.	Investors should verify the availability of incentives under the prevailing rules before including them in investment plans.

These developments do not automatically change which sectors are open to foreign ownership under the Positive Investment List. However, they affect how investors structure their businesses, assess capital requirements, obtain licences, and evaluate investment incentives.

Understanding Indonesia’s Positive Investment List Categories

Indonesia’s Positive Investment List distinguishes between priority sectors, activities reserved for smaller domestic businesses, sectors requiring local partnerships, and business fields subject to specific restrictions.

The framework operates alongside Government Regulation (PP) 28/2025 on risk-based business licensing and BKPM Regulation 5/2025 on investment and licensing procedures.

For foreign investors, this raises two key questions: Is the intended activity open to foreign ownership, and what requirements must be met to operate legally?

1. Priority Business Fields Open to Foreign Investment

Priority business fields are activities the government identifies as important to Indonesia’s economic development and investment objectives.

Annex I of the Positive Investment List identifies priority business fields that may qualify for fiscal or non-fiscal incentives. Eligibility depends on the applicable KBLI classification, investment criteria, and prevailing incentive regulations.

Priority sectors are selected based on characteristics such as:

• National strategic importance and capital-intensive investment
• Labour-intensive operations and employment generation
• Advanced technology and pioneer industries
• Export-oriented production
• Research, development, and innovation

Many priority activities are available to wholly foreign-owned companies, although you must still check the applicable KBLI and sector regulations.

Examples of Priority Business Fields in Indonesia

Business Activity	Foreign Investment Opportunity	Key Investment Considerations
Pharmaceutical manufacturing	Eligible foreign-owned manufacturing operations	Industrial licensing, BPOM requirements, and investment incentives where applicable
Fruit and vegetable processing	Food processing and export-oriented manufacturing	Manufacturing licences, food safety requirements, and investment classification
Digital infrastructure	Data centres, hosting, and eligible digital infrastructure activities	KBLI classification, digital regulations, and infrastructure approvals
Drinking water processing and distribution	Eligible water infrastructure and utility projects	Sector-specific permits, technical standards, and investment approvals
Tourism-related facilities	Hotels, resorts, and qualifying tourism developments	Tourism licensing, zoning, and environmental approvals

These examples illustrate potential foreign investment opportunities. Confirm priority status, foreign ownership eligibility, and access to incentives against the applicable KBLI and sector-specific regulations.

What Investment Incentives are Available?

Eligible priority business fields may benefit from several forms of government support.

Fiscal incentives may include tax allowances, investment allowances, and corporate income tax reductions where an applicable scheme remains available. Non-fiscal incentives can include business licensing facilitation, infrastructure assistance, and certain immigration or employment-related facilities.

However, an activity’s inclusion in Annex I does not guarantee that an investor automatically receives incentives. Separate eligibility criteria and applications apply.

Are Tax Holidays Still Available in Indonesia in 2026?

Under PMK 130/2020, as amended by PMK 69/2024, the application deadline for the relevant corporate income tax reduction scheme was December 31, 2025.

Foreign investors planning new investments in 2026 should confirm the availability of tax holiday facilities under the prevailing regulations before including these benefits in their financial projections.

Other investment incentives, including tax allowances, investment allowances, and non-fiscal facilities, may remain available to eligible businesses.

Multinational enterprise groups subject to Indonesia’s 15% global minimum tax should also assess how these rules affect their potential tax benefits.

2. Business Fields Reserved for Cooperatives and MSMEs

Not every business sector in Indonesia is accessible to foreign investors.

Under Annex II of the Positive Investment List, certain business activities are reserved for Indonesian cooperatives and micro, small, and medium enterprises (MSMEs), limiting direct participation by foreign-owned companies.

The reserved category is intended to protect business opportunities involving smaller investment scales, traditional capabilities, and sectors with important domestic economic participation.

These may include activities characterised by traditional skills, relatively simple production technologies, or limited investment requirements.

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What Does This Mean for Foreign Investors?

A foreign-owned company generally cannot directly conduct activities reserved for cooperatives or MSMEs.

Investors must distinguish between a restricted business activity and a broader industry that may still contain other permitted activities.

For example, certain narrowly defined retail activities may be reserved, while eligible wholesale, distribution, or manufacturing activities may be governed by different rules.

Using a broader industry description without reviewing the precise KBLI can therefore lead to an incorrect conclusion about foreign investment eligibility.

3. Business Fields Requiring Partnerships with Indonesian MSMEs

Some sectors allow foreign-owned or large businesses to participate, provided they establish qualifying partnerships with Indonesian cooperatives or MSMEs.

Annex II identifies business activities that larger businesses, including eligible foreign-owned companies, may undertake through qualifying partnerships with Indonesian cooperatives or MSMEs.

Permitted partnership arrangements may include:

• Subcontracting or outsourcing qualified business activities
• Distribution and supply chain partnerships
• Profit-sharing and other qualifying commercial cooperation
• Other partnership structures recognised by applicable regulations

Importantly, an MSME partnership requirement does not necessarily mean the foreign investor must transfer company shares to an Indonesian partner.

Commercial partnerships and equity ownership are different arrangements. The appropriate structure depends on the relevant KBLI and the rules governing the proposed activity.

Foreign investors should document the partnership structure, confirm the parties’ obligations, and establish how the arrangement will meet licensing requirements.

This is particularly relevant for businesses entering sectors involving local supply chains, distribution networks, or specialised domestic services.

4. Business Fields with Specific Foreign Ownership Requirements

Annex III of the Positive Investment List identifies business activities subject to specific foreign investment conditions, including ownership limits, domestic participation requirements, and other applicable restrictions.

These conditions apply to selected activities in sectors such as transportation, publishing, and broadcasting.

Foreign investors should verify the precise KBLI classification and relevant sector regulations before determining their ownership structure, as restrictions may differ between activities within the same industry.

For example, certain regulated business activities may limit foreign ownership to 49%, requiring eligible Indonesian shareholders to hold the remaining equity.

Such arrangements should reflect genuine, legally compliant ownership, not nominee structures intended to circumvent investment restrictions.

Some international investment agreements may provide different treatment where expressly applicable. Investors seeking to rely on treaty protections should obtain a legal assessment before determining their ownership structure.

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5. Which Business Fields Are Closed to Foreign Investment in Indonesia?

While most commercial sectors are generally open, several activities remain closed to new investment.

Indonesia’s six statutory categories of closed business activities include:

• Cultivation and production of Schedule I narcotics
• Gambling and casino activities
• Fishing of species listed in CITES Appendix I
• Extraction or use of natural coral for prohibited commercial purposes
• Manufacturing chemical weapons
• Manufacturing specified industrial chemicals and ozone-depleting substances

In addition, Perpres 49/2021 closes new investment in three alcoholic beverage manufacturing classifications: KBLI 11010, KBLI 11020, and KBLI 11031.

These restrictions should not be confused with other activities in the same broad industry. For example, the regulations governing alcoholic beverage manufacturing and those governing licensed trading or distribution are not necessarily identical.

Foreign investors should assess the exact activity rather than assuming an entire industry is either open or closed.

Which Sectors Are Open to 100% Foreign Ownership in Indonesia?

One of the most important changes Indonesia’s Positive Investment List introduced is the broader opportunity for foreign investors to establish wholly owned businesses.

Sectors such as manufacturing, digital technology, healthcare, infrastructure, and selected professional services offer opportunities for foreign investment.

However, eligibility depends on the specific business activity, not simply the industry in which a company operates.

Sector	Examples of Business Activities	What Foreign Investors Should Consider
Manufacturing	Pharmaceuticals, electronics, automotive components, food processing	Industrial licensing, product standards, environmental approvals
Healthcare	Hospitals and certain healthcare facilities	Healthcare licensing, operating standards, professional requirements
Technology	Software development, hosting, digital infrastructure	KBLI classification, digital regulations, data protection
Energy	Electricity generation, renewable energy projects	Energy-sector permits, project approvals, environmental requirements
Logistics	Warehousing, eligible logistics and cargo-handling activities	Transportation, storage and operational licensing
Tourism	Hotels, resorts, eligible accommodation operations	Tourism licensing, zoning, building and environmental approvals
Professional services	Management consulting and eligible business advisory services	Service classification and applicable professional restrictions

These are sector-level examples, not confirmation that every KBLI within each sector permits 100% foreign ownership. Sector-specific restrictions still apply.

How to Check Foreign Investment Eligibility Using KBLI 2025

For foreign investors, selecting the correct KBLI is essential because two businesses operating in the same general industry may face different regulatory requirements.

• Identify the actual business activity: Define what the company will manufacture, sell, distribute, develop, or provide.
• Find the corresponding KBLI code: Confirm the most appropriate five-digit classification based on the activity’s scope.
• Examine the Positive Investment List: Determine whether the classification is open, reserved, restricted, or subject to a partnership requirement.
• Check sector-specific regulations: Identify additional foreign ownership restrictions, approvals, and operating conditions.
• Validate the activity in OSS: Confirm the licensing requirements and investment thresholds before proceeding with incorporation.

What Changed with KBLI 2025?

KBLI 2025, introduced under BPS Regulation 7/2025, updates Indonesia’s business classifications, with OSS and AHU integration scheduled for 18 June 2026.

Existing business licenses remain valid if activities are unchanged, and code conversions are handled automatically. However, changes in business activities or operating scope may require updates through OSS and AHU.

Foreign investors should ensure their KBLI classification aligns with their business activities, foreign ownership rules, and licensing requirements before establishing or expanding operations.

What Are the Minimum Investment Requirements for Foreign Investors in 2026?

Under BKPM Regulation 5/2025, a PT PMA generally requires minimum paid-up capital of IDR 2.5 billion, reduced from IDR 10 billion. However, the total investment requirement remains above IDR 10 billion per five-digit KBLI and project location, subject to exceptions.

Requirement	General PT PMA rule
Minimum paid-up capital	IDR 2.5 billion per company
Minimum total investment	More than IDR 10 billion
Investment calculation	Generally per five-digit KBLI and project location
Land and buildings	Generally excluded, with sector-specific exceptions
Ownership structure	Subject to applicable foreign investment regulations

Different investment calculations apply to certain sectors, including wholesale trade, construction, manufacturing, and property-related activities.

Paid-up capital is also generally subject to a 12-month withdrawal restriction, with exceptions for qualifying business expenditures.

Foreign investors planning to register multiple business activities should confirm the applicable investment thresholds and licensing requirements for each KBLI before committing capital.

Confirm Your Foreign Investment Eligibility with Ascentium Indonesia

Understanding Indonesia’s Positive Investment List is the first step towards establishing a compliant business. However, selecting the right KBLI, confirming foreign ownership eligibility, and meeting investment requirements can be complex.

Ascentium Indonesia can help you:

• Assess foreign ownership eligibility for your intended business activities.
• Identify the appropriate KBLI classifications and applicable restrictions.
• Confirm PT PMA capital and investment requirements.
• Prepare the required business licenses and regulatory documents.
• Support company establishment and ongoing compliance in Indonesia.

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