Setting Up A Local PT. Company: A Guide For Foreign Investors

Several business fields are closed to foreign ownership. Here's how to set up a PT company, a local one, in Indonesia as the solution.

When To Establish A Local PT. Instead Of A PT. PMA Or Representative Office.

According to Indonesia’s Positive Investment List, there are several business fields that are closed-off to foreign ownership. The only alternative for foreign investors to operate within these business lines is to establish a Local PT.

The general required structure to establish a Local PT company are as follows:

  • 2 shareholders
  • 1 local director
  • 1 commissioner

As the name explains – a Local PT. is a company set up for Indonesian citizens, with 100% local ownership.

Size Of Local PT. And Its Capital Investment  

A Local PT Company can be divided into 3 sizes. Each size of Local PT. has a different range of Capital Investment required t0 start the company.

  • Small Local PT: Capital Investment of IDR 50 Million to 500 Million
  • Medium Local PT: Capital Investment IDR 500 Million to 10 Billion
  • Large Local PT: Capital Investment of IDR 10 Billion and above

Can A Local PT. Hire Foreign Employees?

Yes, However, the hiring is done via the Special Purpose Vehicle Company and, the required company size is medium Find out how to get a business visa and work permit in Indonesia.

The Process Of Setting Up A Local PT. In Indonesia.

No. Procedure Duration (working days)
1. Approval of company name at the Ministry of Law and Human Rights 2
2. Preparation of Association Article by Notary 4
3. Obtain Deed of Establishment at the Ministry of Law and Human Rights 3
4. Obtain Certificate of Domicile at the local government office 15
5. Obtain Tax payer registration number (NPWP) and VAT number at the tax office 3
6. Obtain Trading Business License (SIUP) 10
7. Obtain Company Registration Certificate (TDP) at the local government office 10

If you are unsure what type of company setup is suitable for your business, feel free to contact us. Cekindo will assist you to establish your business from the start in Indonesia based on your needs. You can subscribe our newsletter to get the updated information regarding business in Indonesia, once a month.

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Pandu Biasramadhan

Pandu is the Consulting Manager at Cekindo. He has extensive experience in working with government agencies. Notably, he has provided market-entry solutions for enterprises in Indonesia and managed regional partnership channels in Southeast Asia. At Cekindo, Pandu aspires to lead the consulting team to provide top-quality market-entry services and maintain a portfolio of global clientele. His specialty is market-entry advisory and business process outsourcing.