Yes, depending on the business sector. The Positive Investment List outlines which sectors allow 100% foreign ownership.
Indonesia stands as Southeast Asia’s largest economy—boasting over 270 million consumers, a digital revolution, and a government committed to deregulation and foreign investment. From manufacturing to fintech, the opportunities are vast.
For foreign investors, the best way to establish a long-term business presence is through a PT PMA (Foreign-Owned Company). Setting up a PT PMA in Indonesia is the most secure, fully recognized business vehicle under local law, allowing you to control operations, generate profit, and grow your business sustainably.
Under Law No. 25 of 2007 (Investment Law), a PT PMA is a limited liability company incorporated in Indonesia in which shares are partially or wholly owned by foreign individuals or legal entities.
Key characteristics:
Unlike representative offices or local partnerships, a PT PMA offers operational independence, direct revenue generation, and asset ownership rights (through HGB land titles or asset licensing). It is a commercial entity capable of full-scale operations.
These legal tools govern ownership limits, licensing structures, capital requirements, and corporate responsibilities.
All licensing is centralized via OSS-RBA, a risk-based platform under BKPM’s supervision. Every PT PMA must be registered and monitored through OSS, which also issues the NIB and risk-assesses your business sector.
Indonesia’s 2021 reform opened up 100+ sectors, especially:
Priority sectors may receive tax holidays, customs facilities, or simplified land access.
Some sectors (e.g., construction, distribution, media) require local partnerships or are subject to ownership caps (e.g., 67%, 49%).
Always verify your KBLI against the latest Positive List, as sector classification directly affects licensing.
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Choose your KBLI code—this determines the nature of your business, foreign ownership allowance, and licensing path. Misclassification here could block your NIB.
Reserve your company name with the Ministry of Law and Human Rights (AHU system). Names must be unique, non-offensive, and comply with Indonesian syntax rules.
A notary drafts the Deed of Establishment in Bahasa Indonesia, listing shareholders, business objectives, structure, and capital. It is legalized by the AHU.
Apply for a Business Identification Number (NIB) via OSS. This acts as your general license, import license, and tax ID number.
You must submit Investment Activity Reports (LKPM) periodically to BKPM—even if the company is pre-operational.
Industries like finance, mining, logistics, and healthcare require specific operational licenses from respective ministries (e.g., OJK, Ministry of Transport).
While OSS does not demand immediate capital proof, BKPM may audit and request bank statements, invoices, and contracts to confirm the IDR 10 billion investment.
Directors are responsible for day-to-day operations and are personally liable for fraud, negligence, or non-compliance. Commissioners oversee the board and must review annual reports.
These mistakes can lead to administrative sanctions, fines, or license revocation. Legal assistance ensures compliance and continuity.
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| Type | Ownership | Activities | Pros | Cons |
| PT PMA | Foreign | Full Commercial | Ownership, Profit | High Compliance |
| Rep. Office | Foreign | Non-revenue | Simple Setup | No Revenue Allowed |
| Local PT | Local | Full Commercial | No Capital Barrier | No Foreign Control |
At Kusuma & Partners, we’ve helped foreign investors set up PT PMA in Indonesia across a wide range of industries. We’ve seen how a well-prepared strategy combined with timely execution makes the difference between success and delay.
Our advice: Don’t underestimate the importance of compliance. The investment process might seem standardized, but nuances in the Positive Investment List, legal & tax planning, and sectoral licensing can derail even seasoned investors.
Setting up a PT PMA in Indonesia is more than filling out forms—it’s a strategic legal journey. By understanding the legal landscape, aligning with investment priorities, and complying with regulations, you’re preparing your business for sustainable success in Indonesia’s vibrant economy.
Thinking of entering the Indonesian market? Contact us today, we assist you set up, to compliance, we ensure your PT PMA is built on a solid foundation.
Fill in the form below to get our expert guidance.
“DISCLAIMER: This content is intended for general informational purposes only and should not be treated as legal advice. For professional advice, please consult with us.”
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