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Company registration in Indonesia

Registering a company in Indonesia involves several steps and compliance with government regulations. The process can vary based on the type of business entity you want to establish and the industry you are entering.

Establish the Right Legal Entity

In principle, all business actors carrying out business activities in the territory of Indonesia can apply for business licenses. Types of business actors include:

  • Individual
    Shall be an Indonesian citizen and is categorized into domestic investment (Penanaman Modal Dalam Negeri/PMDN).
  • Business Entity
    Shall be in the form of either a legal entity or not legal entity which is established in Indonesia, and conducts business and/or activity in certain fields. Investment conducted by this business entity shall be categorized into PMDN or foreign investment (Penanaman Modal Asing/PMA).
  • Representative Office
    Shall be an Indonesian or foreign citizen, or a representative business entity from overseas with approval on office establishment in Indonesian territory.
  • Foreign Business Entity
    shall be a foreign business entity established outside Indonesia territory and conducts business and/or activity in certain fields in Indonesia.

Foreign Investment Limited Liability Company (PT PMA)

The legal entity of the FDI Company should be a Limited Liability Company or Ltd. (Perseroan Terbatas or PT). The establishment of a PT PMA is regulated by Law No. 40 Year 2007 regarding Limited Liability Companies (Company Law). PT PMA shall be categorized as a large business and shall comply with the minimum investment value requirement, except otherwise stipulated by prevailing laws and regulations.

Requirements for Setting up a PT PMA
  • The ‘PT’ company should be owned by minimum 2 shareholders. Those can be individuals legal entities, or a combination of both.
  • The amount of investment required for PT PMA is more than IDR 10 billion (excluding lands and buildings) for every five digits of KBLI per project location, with a minimum paid-up capital of IDR 10 billion.


Furthermore, the required investment amount of IDR 10 billion is exempted for a few business fields as follows:

The process of registering a company in Indonesia can take anywhere from 3-7 working days, depending on how quickly you can gather and provide the necessary documents. It is recommended to consult a professional or a company that specializes in business registration in Indonesia to ensure a smooth and hassle-free process.

Disclaimer

The information provided here is based on our long experience. The process or requirement may vary depending on the specific facts and conditions. Besides, the law and regulations in Indonesia subject to frequent changes. Please contact us as your consultant to get an up to date information and accurate advice. More Information click here and You can also follow our social media accounts to see the latest information posts. please click on the following links: Facebook, Instagram, Linkedin, and Twitter.

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FAQ

In general, PMA stands for Foreign Direct Investment while PMDN stands for Domestic Direct Investment. From the perspective of the meaning, in short, PMA is an investment activity to conduct business in the territory of the Republic of Indonesia which carried out by foreign investors, both those who use foreign capital wholly or in joint ventures with domestic investors. Then, PMDN is an investment activity to conduct business in the territory of the Republic of Indonesia which carried out by domestic investors using domestic capital.

Basically, subjects in domestic investors are Indonesian citizens (WNI), Indonesian business entities, the Government of Indonesia, or regions that make investments in the territory of Indonesia. Meanwhile, foreign investors are foreign citizens, foreign business entities, and/or foreign governments making investments in the territory of the Republic of Indonesia.

With the new regulations and system changes, the process of establishing a company, both PT PMDN or PT PMA, does not take a long time. It takes at least 10-15 working days after the complete document requirements are fulfilled.

Yes. To be able to carry out the establishment process of PT PMA, the authorized capital that must be written in the deed of establishment is Rp. 10 billion excluding the value of land and buildings. In making the deed of establishment, the Notary appointed by us will provide a statement letter to the shareholders who sign that they will deposit the said amount of capital. However, the statement will usually not include the fulfillment period. After the company is established, the company will carry out investment reporting on a regular basis which will later become one of the proofs for the company's activities with its capital.

Generally, the set-up company process is divided into 2 stages. Where, the first stage is the establishment stage. Where at this stage, you will process your company's basic documents and permits, such as: deed of establishment, legalization document, Company NPWP (Taxpayer ID Card), Business Identification Number, Company Bank Account Opening and other documents according to your sector and business field. Furthermore, the second stage is the operational stage. At this stage, before and/or during your company's operations, you are required to fulfill the company's obligations. Such as, payment of related taxes, fulfilling operational permits, reporting LKPM (Investment Activity Report), BPJS Employment and Health Registration, and other obligations according to the sector and business field.

BPJS stands for Social Security Administering Board, which is a special institution tasked with administering health and employment insurance for the public, civil servants, and private employees. BPJS has 2 types, namely: BPJS Healthcare and BPJS Employment. Where every registered company that has employees is required to register its employees in the BPJS program, both BPJS Healthcare and BPJS Employment.

LKPM stands for Investment Activity Report. It is a report on the progress of investment realization and problems faced by business actors that must be prepared and submitted periodically.

Yes, you do. When you do the establishment of a company, a correspondence address is fundamental. It is needed because later all correspondence documents from the government or related agencies will be sent to your company's office/correspondence address. In addition, a company is required to have a domicile which is one of the requirements for making a deed of establishment.

Do you have a location in mind where you plan to establish your company in general? For example, are you planning to do it in Bali, such as in Kuta, Ubud, Sanur or Jimbaran area? We have several specific place references that may help you determine the location of your company office. Just please let us know.

At the stage of the company establishment process, you are not required to come to Indonesia. Although it is no required to come, you may visit Indonesia with the visa which the service we can assist you to have it.

Some process in the establishment company can be carried out by giving your power of attorney to one of our team whom handles the process of establishing your company. Our team is experienced enough in their field therefore the necessary matters will be prepared and informed to you.