PMA Company Establishment

For businessmen or prospective foreign investors who will open a business in Indonesia or invest their capital in a company in Indonesia or may be interested in having their own company, they can establish a legal entity in the form of a PMA or Foreign Direct Investment /FDI Company. Furthermore, foreign investors as the founders of this PMA/FDI Company are allowed to own 100% of their shares. A share ownership of 100% by foreigners is only allowed for certain types of business, such as trading and consulting. Furthermore, shareholders in this FDI company are given facilities to get a work permit and Stay Permit/KITAS directly for 2 years without having to pay DPKK funds of US$ 2400 to the government, but those who are allowed to work are only for the position of President director, while for the position of commissioner, they are not allowed to work even though they are also given a Temporary Stay Permit/KITAS which is also valid for 2 years. Thus, shareholders in FDI companies can save funds of US$ 2400 per 2 years when compared to holders of Temporary Stay Permit/KITAS as ordinary employees (as employees) only.

PT Penanaman Modal Asing or PMA, is a limited liability company established under Indonesian law, in which there is participation or use of foreign capital, either using fully foreign capital or joint venture capital with Indonesian citizens or domestic national companies.
Foreign capital means capital that is sourced and owned by foreign countries, individual foreign citizens, foreign business entities, foreign legal entities, and/or Indonesian legal entities whose capital is partly or entirely owned by foreign parties.

Foreign investment that will enter Indonesia has been regulated by the Indonesian government and must go through foreign investment procedures in accordance with the regulations specified by the government, which in this case is the Investment Coordinating Board (Badan Koordinasi Penanaman Modal, BKPM).

The important thing for foreign investment is the provision of Negative Investment List (Daftar Negatif Investasi, DNI) which regulates the maximum percentage of foreign ownership in a business activity.

For shareholders in a foreign investment company (PMA) in Indonesia, the government has provided various facilities such as ease of obtaining a residence permit, permit to work in the company, purchase property and also obtain a citizenship.

• Legal Certainty

Shareholders in a PMA company do not need to worry about their rights as capital owners, because all assets owned by the company have received legal protection from the government through rules already made in such a way as to maintain a conducive and attractive investment climate for foreign investors.

• Wide Open Business Opportunities

Indonesia is the fourth largest country in the world in terms of population number. Indonesia is also a country that has enormous natural resources needed by other countries. The enormous natural resources owned by Indonesia include gold mining in Papua, coal, natural gas and plantation commodities. Whereas another sector, namely tourism, is also as competitive and profitable as those sectors.

• Shareholders get convenience for visa stay

As the owner of a PMA company, you already qualify as a person entitled to get a residence visa for 2 years (Investor visa/KITAS). With this type of visa, you can stay for 2 full years without having to leave Indonesia and also given a Multiple exit re-entry permit/MERP to enter and exit from Indonesia for 2 years. And after staying using the investor visa / KITAS for 3 full years, you can apply for a Permanent Stay Permit/KITAP which is valid for 5 years and can be extended every 5 years.

• Property Ownership Status is Clear and Protected

In addition to protection to company asset security, the state also provides legal certainty for property ownership status owned by a company in Indonesia. A company can buy any property anywhere in Indonesia on behalf of the company that has a complete permit from the government to carry out its business activities.

To own a company in Indonesia for certain business fields categorized as low and medium risk businesses is Actually not too difficult, because it is not required to have very large funds that must be deposited with the Bank as proof that the company has sufficient capital.

To find out how much initial funds must be prepared to own a company in Indonesia and the rights and obligations as a company owner to the government, please contact our friendly consultant team to discuss it. 

Let’s do business in Indonesia immediately, because the business opportunities here are still very wide open. Saga Consulting is ready to guide you step by step to open a business and establish a company in Indonesia.

According to the law, the validity period of the composition of the management of a Limited Liability Company (PT) is limited to a maximum of 5 years, and after 5 years, a new management must be selected through a general meeting of shareholders. Thereby, the management of Limited Liability Company (PT) after 5 years will dissolve automatically. However, the company’s legality period remains valid and the company can remain legally carrying out various business activities.

Mandatory requirements in the establishment of a PT include:

1. Residential Identification Card (KTP/ Passport) and Tax Identification Number (NPWP) (if individual) and legal entity documents (if PT, Foundation, etc.) of the shareholders.
2. Residential Identification Card (KTP/Passport) and Tax Identification Number (NPWP) of the Management, in this case those who will serve as directors and commissioners.
3. Office lease letter or proof of ownership of office premises, the location of which must be in accordance with office zoning/commercial zoning/mixed zoning.
4. Office photo, if needed.

The company legal documents that will be obtained are:

1.  Deed of establishment
2. Certificate of Legalization from the Ministry of Law & Human Rights
3. Company Tax Identification Number (NPWP)
4. Notification of Registration (SKT) from the Tax Office
5. Company Business Identification Number (NIB)
6. Business License, from OSS
7. Location Permit, from OSS

1. Law No. 40/2007 – Limited Liability Company (UUPT)

This Law (UUPT) is the main legal source for regulating Limited Liability Companies in Indonesia

2. Law No. 1/1995 – Capital Market

Regulating the terms and conditions of parties (one of which is PT) and capital market instruments.

3. Law No. 25/2007 Investment

Regulating ways and procedures for investment by both local and foreign investors

4. Presidential Regulation No. 27/1998 – Merger, Consolidation, Takeover of PT

Regulating ways and procedures for merging, consolidating and taking over a PT

5. Presidential Regulation No. 43/2011 – Procedure for Submission and Use of PT Name

Regulating that the local PT name must use Indonesian Language.

6. Presidential Regulation No. 47/2012 – Corporate Social and Environmental Responsibility of PT (CSR)

Whereas PT that carries out activities related to natural resources is obliged to carry out CSR activities.

7. Presidential Regulation No. 7/2016 – Amendment to the Authorized Capital of PT

Whereas specifically for businesses with MSME criteria, the Authorized Capital is determined according to the agreement. Then, 25% of the Authorized Capital must be paid up and placed.

8. Regulations of Ministry of Laws and Human Rights No. 14/2020 – Procedures for Submission of Application for Legal Entity and Approval of Amendment to Articles of Association and Submission of Notification of Amendment to Articles of Association and Amendment to Data of PT

Regulating the procedures for requesting approval and amendments to the articles of association as well as documents necessary to be submitted to the Minister through the Legal Entity Administration System (SABH).

9. Regulations of Ministry of Laws and Human Rights No. M.HH-02.AH.01.01 of 2010 – Procedure for PT Announcement in the State Gazette and Supplement to the State Gazette of the Republic of Indonesia

Regulating the procedure for announcement in the State Gazette and Supplement to State Gazette on the establishment, dissolution, plan for distribution of assets resulting from liquidation and expiration of the legal entity status of the Company.

10. Presidential Regulations No. 44/2016 – Regulation concerning DNI

DNI = Regulations regarding the maximum percentage of foreign ownership in a business field. An example of DNI is trading activities that are not affiliated with production, so the maximum foreign ownership is 67%.

We strongly believe that business licensing is the most important thing in carrying out business activities in Indonesia. Therefore, we are here to help you complete your business licensing with the aim at ensuring that the company can be established officially & legally in Indonesia. We accept processing of all types of business licenses, licensing documents and legality of your company. We also always provide affordable prices to entrepreneurs; in the process of obtaining business licenses, we do it transparently, in terms of both costs and the process. And we also guarantee that all of your business licenses are complete and their legality is guaranteed complying with Indonesian laws.

Some of the business legalities that we can serve include:

Legality of Notaries such as :

• Deed of Incorporation
• Deed of Amendment to Business Name
• Deed of Amendment to the Composition (Structure) of the Board of Directors
• Deed of Amendment to Capital
• Deed of Amendment to Domicile
• Deed of Company Dissolution/Closure
• Deed of Branch
• Deed of Cooperation
• Deed of Marriage Agreement

Business licensing :

• NIB (Business ID Number)
• PKKPR (Location Permit)
• Industrial Business License
• Construction Business License
• SNI (Indonesian National Standard)
• Intellectual Property Rights (IPR)
• Patent
• Trademark
• Copyright
• Building license
• BPOM (Supervisory Agency of Food & Drug)
• Standardized Distribution License
• Standardized Production License
• TDUP (Tourism Business Registration Certificate)
• Restaurant License
• Catering License
• MICE
• Drugs & Medical Devices License
• Clinic License
• API (Import Identification Number)
• NIK (Customs Identification Number)
• Limited Import
• Limited Export
• Mining License
• Financial Business License
• Money Changer
• FSA
• Debt Collector License
• Transportation Services License
• Transportation Services Business License (SIUJPT)
• SIUPAL
• Courier License
• Forklift Operational License
• Warehousing Services License
• PDGB (Bonded Warehouse)
• TDG (Warehouse Registration Certificate)
• Warehouse rental
• Franchise License
• Gas Station License
• Digital Business License
• SIUPMSE (E-Catalog)
• NFR Permit
• ISP Permit
• KOMINFO Permit

We are one of the trusted consultants providing licensing and legal services. In a fast process, we are ready to help you get a business license handled by our team who will work professionally and understand legal regulations.

The advantages of our services indicate that licensing is not difficult, complete business license, easy to obtain license, and legal consultations with professionals.

We guarantee that your entire licensing process will be easier,  because you can get all of these services in only one package of Business License processing service fees

Concerning quality and credibility, you don’t need to hesitate! We have official license from the government and have collaborated with many entrepreneurs. Therefore, you don’t need to worry about making us your partner in creating or managing your Business License.