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Indonesia market entry | Foreign-invested company formation | Business licensing | Tax and operational setup
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Indonesia is one of Southeast Asia’s largest economies and an important destination for businesses already operating in Japan, Hong Kong, Singapore, and other markets that wish to expand across the region. For foreign investors planning to conduct business directly in Indonesia, earn local revenue, enter into commercial contracts, and employ staff directly, a PT PMA (Perseroan Terbatas Penanaman Modal Asing) is the principal form of foreign-invested company.
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Foreign ownership structures
Most business sectors in Indonesia are currently open to foreign investment, but some remain subject to foreign ownership limits, partnership requirements, or special licensing. The applicable conditions must therefore be checked against the specific KBLI code.
BKPM states that, apart from certain restricted sectors, many business activities are open to 100% foreign ownership.
Lower paid-up capital requirement
Under the current Regulation No. 5 of 2025, the minimum subscribed/paid-up capital for a foreign-invested limited liability company established as a PT PMA is IDR 2.5 billion.
OSS risk-based licensing
NIB registration and relevant permits are handled according to the risk level of the specific business activity, providing a clearer licensing pathway for different types of business.
A long-term local operating entity
Suitable for foreign businesses seeking to establish long-term operations, employee teams, customer relationships, and a regional operating base in Indonesia.
Businesses expanding in Southeast Asia
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Businesses already operating in Japan, Hong Kong, Singapore, or elsewhere that wish to establish a local company in Indonesia.
Trading and sales businesses
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Businesses planning to import and sell goods in Indonesia, enter into local contracts, and establish sales channels.
Manufacturing, services, and local operations
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Businesses that need a factory, office, service team, or long-term local workforce.
Confirm activities and KBLI codes
Define the planned business activities and confirm the corresponding KBLI codes, foreign ownership conditions, and risk classifications.
Determine shareholders and structure
Confirm shareholders, directors, commissioners, ownership percentages, registered capital, and the investment plan.
Prepare incorporation documents
Prepare shareholder information, articles of association, the deed of establishment, registered address, and other required documents.
Company registration and OSS application
Complete company registration and apply for an NIB through OSS. The NIB is currently the official identification number for businesses starting or conducting operations in Indonesia.
Tax and sector-specific licensing
Obtain tax identification details and arrange standard certifications or sector-specific permits according to the KBLI risk classification.
Banking, staffing, and ongoing operations
Assist with corporate bank accounts, staffing arrangements, taxation, compliance, and subsequent operational setup.
How much capital is required to establish a PT PMA?
The general minimum subscribed/paid-up capital is IDR 2.5 billion. The total investment plan usually needs to exceed IDR 10 billion, with the specific requirements assessed according to the KBLI code and type of business.
Is an Indonesian shareholder required?
For sectors open to 100% foreign ownership, a local shareholder is generally not required solely to satisfy ownership rules. The actual business sector must nevertheless be checked first.
How long does the process take?
The timeframe depends on the business type, KBLI codes, document readiness, and licensing requirements. Approximately 3–4 weeks is a general reference.
