The process of company registration in Indonesia can be done in three ways: A Representative Office, Local Company or Foreign Direct Investment as a Limited Liability Company (in Indonesia it is called PT PMA)
Indonesian legal entity which can only be owned 100% by local. The only possibility of foreign involvement is through a nominee arrangement which will be based on the special loan agreement.
Indonesian legal entity that can be owned by foreigner up to 100%. For PT PMA, the maximum foreign ownership is determined by the business sector and its activity which generally listed in a regulation called the Indonesian Negative Investment List.
Commonly considered as the branch of parent company overseas can be your first step to enter the Indonesian market. This legal entity is intended for marketing activity or preparing the establishment of PT PMA, includes market research. There is no direct selling or generating revenues allowed with a representative office.
For a complete overview of our services for every company, you can check here
Advantages of company registration for Indonesian Limited Liability Company (PT PMA)
You can officially start doing a business in Indonesia and have the same rights and responsibilities as any other local company.
Your company can join and participate in all tenders in Indonesia.
You and all your foreign employees can apply for a work visa (called KITAS) under the name of your company.
Your foreign clients and visitors can directly obtain a business visa sponsored by your company.
Characteristics of an Indonesian Limited Liability Company (PT PMA)
Can be owned up to 100% by foreigners. Maximum foreign ownership depends on the business classification mentioned in the regulating document called the Negative Investment List. Foreign ownership can be from 0 to 100% depending on the business industry. Download the complete negative list here.
A minimum of 2 shareholders. Shareholders can be individuals or companies.
A required Investment plan at least US$1 million. The Indonesian institution called Indonesian Investment Coordinating Board (BKPM) requires foreign investors to present an investment plan for a minimum of US$1 million (equivalent for IDR 10 billion), of which 25% needs to be paid up capital. Foreign companies, however, cannot open a bank account before the incorporation process is completed. You are only required to submit a notary statement letter that this amount will be transferred once the incorporation is complete. However based on the new regulation, a new foreign company needs to have financial audit before they can apply for a permanent business license and also other connected licenses (import license, etc.), which are critical for a lot of companies. This new regulation wants to ensure that all foreign investors will realize their investment plan and do not only submit an investment plan to Investment Coordinating Board (BKPM) on paper, which often happened in the past.
Licensing requirements for your selected industry. Some business activities, such as the operation of restaurants or hotels, require special licenses.
Indonesian laws. Foreign entities and entrepreneurs intending to establish a form of local company owned by foreign investors shall go through the procedures according to Indonesian laws and regulations based on Law No. 25 / 2007 regarding Capital Investment and Law No. 40 / 2007 regarding the Limited Liability Company.
Our legal team is ready to assist you in all processes of company formation in Indonesia, you can check our page about step-by-step company formation.
The process of company registration for an Indonesian Limited Liability Company (PT PMA)
The entire registration and establishment process, including all procedures, takes from 6 to 8 weeks.
No.
Procedure
Duration (working days)
1
Approval of company name at the Ministry of Law and Human Rights
2
2
Approval of Principal License at the Indonesian Investment Coordinating Board (BKPM)
15
3
Preparation of Article of Association by Notary
4
4
Obtaining Deed of Establishment at the Ministry of Law and Human Rights
3
5
Obtaining Certificate of Domicile at the local government office
15
6
Obtaining Tax payer registration number
3
7
Obtaining Company Registration Certificate at the local government
10
Cekindo registers several companies every month. Our legal team is ready to assist you.
Feel free to contact us for a free quotation on pursuing company registration in Indonesia.
