Indonesia, as a promising market, continues to create pathways for foreign investment.. If a foreign company wants to incorporate a business in Indonesia, setting up a PT PMA is an effortless way to do so. But understanding and complying with the regulations and registration process can feel daunting. This guide is designed to walk you through everything you need to know about registering a PT PMA in Indonesia.
What is a PT PMA?
Perseroan Terbatas Penanaman Modal Asing, abbreviated as PT PMA, is a foreign-owned company in Indonesia. Perseroan Terbatas means Limited Liability Company, and PMA means foreign investment. It is a structure that allows foreign companies to operate in Indonesia.
PT PMA is a foreign-owned company in Indonesia. Foreigners can own 100% of the shares in it, but there are some limitations, which are stated in the Positive Investment List. Having a local partner is a necessity.
The Positive Investment List outlines which business sectors are open to foreign investment and how much foreign ownership is allowed in each sector. When a foreign company wants to register a PT PMA in Indonesia, they must check this list to know whether they can fully own the company or whether they need an Indonesian partner. A PT PMA must have at least 2 shareholders, which can be two individuals or two legal entities or a mix of both.
So, whether you’re setting up a business anywhere in Indonesia, a PT PMA is your ticket to fully operate within Indonesian legal frameworks.
Why should you Choose a PT PMA Structure?
Setting up a business in a new country is not a light decision. You’re investing your capital, your trust, time, and hope. For foreign entrepreneurs and investors looking to enter Indonesia’s vibrant and expanding market, the PT PMA (Foreign-Owned Limited Liability Company) is your gateway to company incorporation in Indonesia.
1. Full Legal Standing to Operate Commercially
A PT PMA allows you to run your business in Indonesia legally, sign contracts, earn revenue, hire employees, lease office space, and more. It gives your company the legal recognition and authority it needs to operate on equal footing with local businesses.
2. Foreign Ownership
Indonesia welcomes foreign investors in various sectors with open arms. Depending on the industry, you can own up to 100% of your company. This means you retain direct control of your business and have no silent partners or risky arrangements.
3. Eligibility for Incentives and Support
By registering a PT PMA, your company may become eligible for a range of government-backed benefits, including tax holidays and reductions, import duty exemptions, and investment incentives in special economic zones. These incentives are designed to ease your entry and support your long-term growth in Indonesia.
4. Greater Credibility with Local Stakeholders
A PT PMA tells clients, vendors, and regulators that you’re serious about your business. It builds trust, legitimacy, and credibility, which can go a long way in markets where relationships matter.
5. Sponsor Work Permits and Visas for Your Team
Once registered, your PT PMA can sponsor KITAS (limited stay permits) and business visas for foreign directors, shareholders, and professionals. This makes it easier to bring in key talent and maintain operational oversight from within Indonesia.
6. No Nominee Required
In many sectors, there’s no need for a local nominee or joint venture partner. That means less legal complexity, and your ownership is protected, transparent, and fully recognised under Indonesian law.
7. Access to Corporate Banking and Financing
A PT PMA can open a local corporate bank account, apply for loans, manage payroll, and conduct seamless local and international transactions. It also helps with tax registration and compliance with Indonesia’s financial regulations.
8. Built for Scale and Long-Term Growth
Whether you plan to stay small or scale big, a PT PMA structure is flexible and future-ready. You can expand operations, raise capital, import goods, or bring in additional investors—all while remaining fully compliant.
9. Stronger Protection for Assets and Intellectual Property
With a PT PMA, you can register trademarks, own physical and digital assets, and enter into enforceable legal agreements. This adds an extra layer of protection for your brand, your investments, and your future in Indonesia.
10. Clear Exit Path if You Need It
Markets evolve, and so do business strategies. If one day you decide to exit Indonesia, a PT PMA offers a structured and legally sound exit strategy through selling shares, transferring ownership, or winding up operations.
Are there any other Options for Foreign Investors Besides PT PMA?
Below is a comparative overview of the most common business setups for foreign investors in Indonesia, highlighting their suitability, limitations, and strategic relevance:
A comparison table of six business structures for foreign companies in Indonesia, highlighting ownership limits, legal protection, usage, and restrictions.
While other entry routes may serve specific short-term or limited purposes, only PT PMA offers a comprehensive, scalable, and secure structure for foreign companies that want to do business in Indonesia.
How to register a PT PMA in Indonesia?
The process of registering a PT PMA in Indonesia involves crucial steps, which are discussed below –
1. Check the Foreign Ownership Restrictions (KBLI & Investment List)
Before beginning, confirm whether your business activity is open to foreign investment. Indonesia classifies activities under KBLI (Klasifikasi Baku Lapangan Usaha Indonesia) codes (Indonesian Standard Industrial Classification). The Positive Investment List (replacing the former Negative List) outlines which sectors allow 100% foreign ownership and which are restricted or require local partnership.
2. Decide on Shareholding Structure & Capital Requirements
Determining the right shareholding composition and fulfilling capital obligations are foundational to PT PMA registration.
To form a PT PMA, you need-
- At least 2 shareholders (individuals or entities)
- 1 director and 1 commissioner
- Minimum paid-up capital: Generally IDR 10 billion (~USD 650,000)
This capital doesn’t always need to be deposited upfront however it must be declared and documented in your notarial deed. Some industries may require higher capital.
3. Choose Your Business Location
Your company’s registered address must be a commercial address (not residential), especially if you’re applying for business licenses later.
Cities like Jakarta, Bali, and Surabaya have specific zoning regulations. Coworking spaces or virtual offices are acceptable for certain service-based businesses.
4. Draft and Notarise the Deed of Establishment
A formal Deed of Establishment, prepared and notarised in Bahasa Indonesia, is required to define the legal structure, ownership details, and scope of activities. This is then submitted for legal recognition by the Ministry of Law and Human Rights. A local notary will prepare and legalise your Deed of Establishment, which includes:
- Company name
- Shareholder details
- Business activities
- Capital structure
- Board members
Once notarised, the deed is submitted to the Ministry of Law and Human Rights (MoLHR) for approval and issuance of the Legal Entity Certificate.
5. Obtain a Tax ID (NPWP) and Register for OSS
Post-incorporation, securing a Tax Identification Number (NPWP) and registration via the OSS (Online Single Submission) system are mandatory for operational legitimacy. This step also facilitates access to your Business Identification Number (NIB).
- Once your company is legalised, you are required to register with the local tax office for an NPWP (Nomor Pokok Wajib Pajak), which is the corporate tax ID.
- Sign up on the OSS (Online Single Submission) system for business licensing and NIB (Business Identification Number).
- The NIB is your company’s master business licence and includes automatic registrations for import/export, social security, and tax compliance.
6. Apply for Additional Business Licences
Depending on your sector, you may need further licences (e.g. tourism, food & beverage, fintech, construction). These are obtained via the OSS portal and often involve multiple layers of clearance.
Some regulated industries require-
- Environmental impact assessments
- Location permits
- Operational permits from sector-specific ministries
7. Open a Corporate Bank Account
Once you have your NIB and NPWP, you can open a bank account. Choose from major Indonesian banks (e.g. BCA, Mandiri, DBS Indonesia) and submit your corporate documents, including:
- Deed of establishment
- NPWP
- NIB
- ID of director(s)
What Are The Common Challenges And How To Avoid Them?
While registering a PT PMA in Indonesia offers many advantages, foreign investors often encounter certain challenges during the process. By understanding these hurdles in advance, you can take proactive steps to ensure a smoother, faster, and fully compliant setup.
Conclusion
Setting up a PT PMA in Indonesia is the beginning of your company’s journey in one of Asia’s most promising markets. And while the process might seem complex at first, having the right guidance can make all the difference.
At 3E Indonesia, we’ve helped hundreds of foreign investors turn ideas into fully operational businesses. We understand that every investor’s needs are unique, and we tailor our support accordingly.
Whether you’re exploring Indonesia for the first time or ready to set up your PT PMA, our experienced team is here to simplify the process, minimise delays, and ensure full compliance, so you can focus on building your business.
Incorporate Your PT PMA in Indonesia Now!
Registering a PT PMA is the smartest and most secure way to legally operate as a foreign company.
Frequently Asked Questions
The process typically takes 2 to 4 weeks, depending on the type of company and completeness of documents.
Key documents include shareholder ID/passport, proposed company name, office address, business field classification (KBLI), and Articles of Association.
Yes, a physical office address is mandatory. For PT PMAs, a commercial office space is required.
For local companies (PT), yes. For PT PMAs, at least one foreign director and shareholder are allowed, but a local commissioner is typically needed.
Yes. After incorporation, your company must obtain a Business Identification Number (NIB) and specific operational licenses based on your industry.
Abigail Yu
Author
Abigail Yu oversees executive leadership at 3E Accounting Group, leading operations, IT solutions, public relations, and digital marketing to drive business success. She holds an honors degree in Communication and New Media from the National University of Singapore and is highly skilled in crisis management, financial communication, and corporate communications.
