PT PMA – Foreign Investment Company

Over the last ten years, Indonesia has emerged as a premier hotspot for foreign investment company, particularly in Bali, where entrepreneurs enthusiastically establish new ventures. The PT PMA license is the most favored and secure option for foreign investors, accommodating projects of any size without imposing any operational restrictions.

Defining a Foreign Company

A foreign company is recognized as any entity where foreign investors own a stake, even as little as 1% of shares. Indonesian law permits foreign direct investment through the PT PMA license. For those looking to simply represent a foreign entity without partaking in local revenue, establishing a representative office is an alternative option.

Restrictions on Foreign Ownership

Indonesian regulations stipulate limits on the allowable percentage of foreign ownership based on the nature of the business. While some sectors permit complete foreign ownership, others cap it at 10%. These stipulations can be found in the Negative Investment List (DNI).

Advantages of Establishing a Business

Opening a business in Indonesia offers numerous benefits, including:
– Compliance with local laws by creating a recognized legal entity.
– The ability to open a bank account for transactions.
– Eligibility to apply for an investor visa (KITAS).
– Access to various local health insurance options.

Steps to Register a PT PMA in Indonesia

To register a PT PMA, an authorized capital of at least 10 billion Indonesian rupiah is required, alongside a minimum of two shareholders, one director, and one commissioner. A registered office address is also necessary.

PT PMA Registration Process

1. Choose the Right Business Classification: Selecting the appropriate classification is crucial to optimize allowed foreign ownership.
2. Secure Office Space: Obtain a Domicile Letter to confirm the registered address.
3. Obtain NPWP Tax Number: Register with the Tax Office to secure your NPWP tax identification number.
4. Acquire NIB for Business Registration: Obtain the Nomor Induk Berusaha (NIB) for official registration.
5. Secure Necessary Licenses: Acquire any licenses or permits necessary for your operations.