Home Blog Setting up Business in Surabaya: A Simple Guide for Foreigners Indonesia Setting up Business in Surabaya: A Simple Guide for Foreigners InCorp Editorial Team 19 July 2019 4 minutes reading time Table of Contents Invest in Surabaya: Why? Types of Legal Entity in Surabaya Tips for Starting an Export and Import Business in Surabaya Ready to Start Your Business in Surabaya? As the capital of East Java, Surabaya has more than 3 million people in the city. Though populated, the city is actually less saturated than Jakarta and Central Java with high economic growth. Doing business in Surabaya, then, is something you as a foreign investor want to consider. Over the past few years, many investors from all over the world have shifted their attention from major cities to Surabaya, focusing on trading (export and import), resources, manufacturing, and infrastructure sectors. Let’s take a look at the reasons you should invest in Surabaya and the types of legal entities that are available for you. Invest in Surabaya: Why? Excellent Location Surabaya is the gateway to East Indonesia. With its sea and air connections, the city grants access to the Javanese interior. What is more, its proximity to major trade routes among the Java Sea, Indian Ocean, Maluku Islands, and the Straits of Malacca has made Surabaya an ideal location for import and export. Best Tourism City At the Yokatta Wonderful Indonesia Tourism Award, Surabaya was awarded the “Best Tourism City” for outstanding commitment, performance, innovation, creation, and leadership in developing regional tourism. This is also one of the reasons Surabaya has become a top investment paradise in Indonesia for foreigners. The surge of business license applications in Surabaya – 9657 business licenses was issued in 2018 – also indicates the rise of the investments. Most of these investments came from China, Singapore, Japan, South Korea, the USA, Oman, and Saudi Arabia. Strong Economic Growth The gross regional domestic product (GRDP) of Surabaya was recorded at US$34 billion in 2016. With the increase of per-capita income from US$ 784 to US$ 1190 in the same period, Surabaya has also transformed into a city of prosperity with a higher percentage of the middle-income group with elevated consumption levels. Developing Infrastructure In order to lead more investors into the booming investment scene in Surabaya, the government has put in a lot of effort to improve the city’s infrastructure and appearance. Regional zoning is also under consideration for the purpose of stretching the investment opportunities. West Surabaya region is now concentrated with property investments while Surabaya’s city center has more service investments. Therefore, regional zoning placement will make perfect sense to make Surabaya an outstanding investment utopia. Types of Legal Entity in Surabaya You will need to incorporate a legal entity in Surabaya if you’d like to set up your own business in the city. Before the establishment, you must know the correct type of legal entity that is suitable for your current business circumstances. Especially for foreign companies that haven’t had any experience in establishing a company in Indonesia, seeking professional advice from an expert business consultant is highly recommended. In general, there are three legal entities in Surabaya that are most suitable for foreign investors: Foreign-owned limited liability company (PT PMA) 1% to 100% foreign ownership depending on your business sector. Some sectors are restricted under the Negative Investment List (NIL). Please contact Cekindo to know more. Better conditions for import goods Business visa and work permit sponsorship is allowed Local limited liability company (PT) Can only be owned by local nationals Low minimum investment capital You will need Special Purpose Vehicle services (professional shareholders/directors/commissioners) if you want to set up a local PT as a foreigner No restrictions under the NIL Representative office For market presence and promotion only Not allowed to be used to take part in any profit-generating business activities Tips for Starting an Export and Import Business in Surabaya There are two options to start an export or import business in Surabaya: establishing your own foreign-owned company PT PMA or engaging a third-party undername import/export company. To set up an import/export PT PMA, you will need to meet the following requirements: a minimum investment of IDR 10 billion a minimum paid-up capital of IDR 10 billion application of business licenses and permits through Online Single Submission System (OSS) On the other hand, engaging an undername export/import company will save you all the time you need to put in for the procedure and paperwork. You can just start your import/export business right away without applying for business licenses and permits. Related article: How to Prevent Your Goods from Being Stuck at Indonesian Customs Ready to Start Your Business in Surabaya? Whether you want to know more about establishing a company or how to start a business in Surabaya, you can always contact Cekindo for further information. Get in touch by filling in the form below or visiting our offices in Jakarta, Bali, and Semarang. Read Full Bio Verified by Daris Salam COO Indonesia at InCorp Indonesia With more than 10 years of expertise in accounting and finance, Daris Salam dedicates his knowledge to consistently improving the performance of InCorp Indonesia and maintaining clients and partnerships. Frequently Asked Questions Get in touch with us. Lead Form Updates Full NameEmailPlease provide corporate email where possiblePhone NumberOffice SetupWhich city are you planning to expand into?JakartaSemarang/Central JavaBali/LombokBatam/SumateraSurabaya/East JavaOther ProvincesType of Service- Please Select -[SPECIAL PACKAGE] Company Registration + Office Package (20% OFF)[SPECIAL PACKAGE] Product Registration + License Holder (20% OFF)Business SetupAccounting and TaxHR & Payroll servicesImmigration ServicesProduct Registration and ImportCompliance and Secretarial ServicesBusiness AdvisoryMore ServicesType of Service- Please Select -[SPECIAL PACKAGE] Company Registration + Office Service (20% OFF)[SPECIAL PACKAGE] Comprehensive Industrial Package (15% OFF)Business SetupAccounting and TaxHR & Payroll servicesImmigration ServicesProduct Registration and ImportCompliance and Secretarial ServicesBusiness AdvisoryMore ServicesType of Service- Please Select -[SPECIAL PACKAGE] Company Registration + Office Service (20% OFF)[SPECIAL PACKAGE] Comprehensive Industrial Package (15% OFF)Business SetupAccounting and TaxHR & Payroll servicesImmigration ServicesProduct Registration and ImportCompliance and Secretarial ServicesBusiness AdvisoryMore ServicesType of Service- Please Select -[SPECIAL PACKAGE] Company Registration (25% OFF) + Office Space (Private Office 30% OFF)[SPECIAL PACKAGE] Company Registration + Investor KITAS (25% OFF)[SPECIAL PACKAGE] Accounting + Tax Services+ Annual Fintax Report (20% OFF)[SPECIAL PACKAGE] Payroll Services for Executive Role (20% OFF)Business SetupAccounting and TaxHR & Payroll servicesImmigration ServicesProduct Registration and ImportCompliance and Secretarial ServicesBusiness AdvisoryMore ServicesType of Service- Please Select -[SPECIAL PACKAGE] Company Registration (20% OFF) + Office Service (25% OFF)[SPECIAL PACKAGE] Company Registration + Micro Finance Services (25% OFF)[SPECIAL PACKAGE] Property Assistance: Due Diligence + AJB Purchase/Lease Agreement (25% OFF)Business SetupAccounting and TaxHR & Payroll servicesImmigration ServicesProduct Registration and ImportCompliance and Secretarial ServicesBusiness AdvisoryMore ServicesType of Service- Please Select -Business SetupAccounting and TaxHR & Payroll servicesImmigration ServicesProduct Registration and ImportCompliance and Secretarial ServicesBusiness AdvisoryMore ServicesServices Company Registration Renting Virtual and Serviced Office Mergers and Acquisitions Business and Import Licenses Corporate Recovery and Insolvency Closing of Company (Dissolution) Land and Property Ownership Shelf Company Local NomineeServices Accounting and Tax Reporting Audit and Review Transfer Pricing Compliance Tax RefundHuman Resource Sub Services Payroll Outsourcing Employer of Record Recruitment and HR Establishment Employment ServiceServices Business Visa Work Permit and KITAS Dependent Visa (Spouse and Family) OtherBusiness Visa Subservices Business Visa Visit Visa Visa ExtensionServices Medical Device Beauty (Skincare and Cosmetic) Food and Beverage Health Supplement Household Product Halal Certification TrademarkServices Legal Consultation Legal Agreement Service Due Diligence and Background Check Company Documents RevisionBusiness Advisory Business Advisory Services ESG Reporting & Advisory Internal Audit Risk ManagementMore Services Market Research and Analysis Local Distributor and Partner Bank AccountMessageSubmit What you’ll get A prompt response to your inquiry Knowledge for doing business from local experts Ongoing support for your business Disclaimer The information is provided by PT. Cekindo Business International (“InCorp Indonesia/ we”) for general purpose only and we make no representations or warranties of any kind. We do not act as an authorized government or non-government provider for official documents and services, which is issued by the Government of the Republic of Indonesia or its appointed officials. We do not promote any official government document or services of the Government of the Republic of Indonesia, including but not limited to, business identifiers, health and welfare assistance programs and benefits, unclaimed tax rebate, electronic travel visa and authorization, passports in this website. More on Indonesia Net-Zero Strategies: Cutting Carbon Footprint for Business Growth Read more An In-Depth Look to Dissolving a Company in Indonesia Read more The Future of Financial Technology in Indonesia: Trends and Opportunities Read more