Company Incorporation in Indonesia

A list of sectors closed to foreign investment or where foreign investment is capped. 

In Indonesia, there are six different types of companies for you to start your business with.

Perseroan Terbatasa (PT)

• A limited liability company and the most common foreign company option incorporated in Indonesia. There are three categories of PT companies; Small-sized, Medium-sized and Large-sized. The difference between them are the paid-up capitals, and governed by the Capital Investment Coordinating Board.

Perseroan Terbatas Penanaman Modal Asing (PT PMA) / Penanaman Modal Asing (PMA)

• A foreign-owned company, established under the stipulated regulations of Foreign Captial Investment Law and approved by the Capital Coordinating Board of Indonesia. During later point of time, should the company consider to be public listed, they are eligible to do so.

Kantor Perwakilan Perusahaan Asing (KPPA)

• A foreign representative office, designed for investor who want to study the Indonesian market for research and business-related development purposes. The existence of KPPA is to serve as the parent company’s buying and selling agent but with limitations, as it is restricted to certain business regions such as services, banking, trading, mining, gas, and oil.

Representative office for trading (KP3A) 

• A foreign trade representative office, designed for foreign business owners to learn more about the Indonesia market before starting a company in Indonesia, thus it provides them an inherent advantage over their competitors.

Nominee Limited Liability Company

• A business option that allows business owners to begin their operations immediately, allowing them to register a company in Indonesia through an Indonesian nominee. This company type enables you to speed up processes; such as bypassing foreign investment restrictions, close deals fast and obtain contracts.

Public company

• A company type that requires to comply to stringent company registration regulations. It requires the company to have at least 300 shareholders and a paid-up capital of IDR one billion, in order to be listed under the stock exchange.

In Indonesia, a foreign-owned company receives many privileges and advantages, and they are mentioned in the following;

1. Ease of obtaining licenses and permits – Most checks are done within a short amount of time with reference other business entity types.
2. Sponsorship of Foreign Employees – Foreign employees can receive sponsorships from company if they meet the criteria set by the government.
3. Lower Import Duties – The amount of import duties is lessened while compare to other business entities, allowing the business owner to benefit from tax and other financial advantages if they are eligible.

In Indonesia, it is mandatory to open a Corporate Bank Account before you can start a company and benefit from hassle-free process when working with various bank services.

Apart from the mentioned, the corporate bank account of that company cannot be shared with another company.

Yes, Foreigners can serve in a Perseroan Terbatas Penanaman Modal Asing (PT PMA) – A foreign owned company type which requires shareholders, directors, and company commissioner; if they meet certain requirements stated by the regulatory.