In general, yes foreigners are permitted to set up businesses in Indonesia, however, certain businesses are restricted to foreign ownership and others where foreign ownership stakes are limited by law. Please contact us for more information.
PT (Perseroan Terbatas) is the Indonesian term for a limited liability company.
PT PMA (Penanaman Modal Asing) is a limited liability company established with foreign direct investment, allowing foreign ownership from 1% to 100%. Foreigners can serve as shareholders, directors, or commissioners. However, not all business activities are fully open to foreign ownership—some sectors are subject to foreign ownership restrictions as regulated by the Indonesian government.
PT PMDN (Penanaman Modal Dalam Negeri) is a limited liability company with 100% local/domestic direct investment. Foreigners can not be shareholders in PT PMDN.
2 shareholders are needed to incorporate a PT.
1. The minimum investment requirement for Foreign Investment Companies (PMA) is set at more than IDR 10 billion (excluding land and buildings) for each 5-digit KBLI code per project location. Exceptions apply to specific sectors as follows:
- Wholesale trade: more than IDR 10 billion (excluding land and buildings) per 4-digit KBLI code.
- Food and beverage services: more than IDR 10 billion (excluding land and buildings) per 2-digit KBLI code per location.
- Construction services: more than IDR 10 billion (excluding land and buildings) per 4-digit KBLI code.
- Industries producing multiple products within a single production line: more than IDR 10 billion (excluding land and buildings).
- Property development and management: minimum investment of more than IDR 10 billion with specific provisions apply.
2. The minimum paid-up/issued capital for each PT PMA is IDR 2.5 billion.
These thresholds are established by the government to ensure that foreign direct investment (FDI) contributes to national development objectives by fostering large-scale investment, creating employment, enabling technology transfer, and enhancing domestic industrial competitiveness.
- Micro: a maximum of IDR 1 billion (excluding land and buildings)
- Small: more than IDR 1 billion and up to IDR 5 billion (excluding land and buildings)
- Medium: more than IDR 5 billion and up to IDR 10 billion (excluding land and buildings)
- Large: more than IDR 10 billion (excluding land and buildings)
PMA / PMDN incorporation process takes about 2-3 weeks.
A KPPA is a representative office of a foreign company in Indonesia. It is limited to supervisory, liaison, and coordination functions, as well as preparing the establishment of a PMA. The office must be located in a provincial capital..e.g. Jakarta, Bandung, Surabaya, Denpasar, etc.
There is no minimum capital requirement. However, a KPPA is strictly prohibited from conducting commercial activities or generating revenue. A PT PMA should be established instead for profit-generating activities in Indonesia.
KPPA licence does not have a validity period, meaning that it is valid as long as the KPPA operates.
KITAS refers to the Indonesian stay permit, allowing foreigners to stay in Indonesia for a specified period legally.
Investor KITAS (E28A) is granted to individuals who own shares in an Indonesian company with a minimum share capital of IDR 10 billion in their name. Learn more about the Investor KITAS here.
Investor KITAS (E28A) is initially valid for 2 years and can be extended.
Passports must have a minimum validity of 6 months.
A minimum account balance equivalent to USD 2,000 is required for KITAS.
Work Permit KITAS (E23/E25) is issued to individuals employed by an Indonesian company.
Work permit KITAS is valid for 1 year and extendable for up to 5 years.
No, you are only allowed to work for the company that sponsors your KITAS. But you can work for two companies as long as you are a director/commissioner in both companies and you will have to pay the DPKK in both companies
No, you are only allowed to work based on the location stated in your work permit.
The KITAS registration process takes about 2-3 weeks for Investor KITAS (E28A); 6-8 weeks for work KITAS (C312).
Spouses and children require Dependant KITAS (E31B or E31E)
Parents can obtain Dependant KITAS (E31H) under certain conditions.
If you need to check for Indonesian company registration details, you can use our Company Registry service to discover some information about the company.
Company registration is the process of forming a company, while a company registry is an official list of all companies and information about them.
The company registry contains detailed information about the company status, capital and shareholders, and the company’s history. Learn more about the company registry here.