A PT PMA is a foreign-owned limited liability company based in Indonesia.Many company owners in Indonesia choose to start a Perseroan Terbatas Penanaman Modal Asing (PT PMA) because of the many privileges and advantages which are present within this business entity type.

Privileges of a PT PMA

There are several different business entities which exist in Indonesia today. Anyone who chooses to start a business in Indonesia may utilize any of these business entities for that purpose. These business entities include the sole proprietorship (UD), the partnership, the local company (PT), the representative office, and the foreign-owned company (PT PMA). The PT PMA is the option typically selected by foreigners who have chosen to start a business in Indonesia. The acronym PT PMA stands for Perseroan Terbatas Penanaman Modal Asing. A PT PMA is established by a foreigner through the use of foreign capital which is to be contributed by a local figure. There are several advantages and privileges granted to those who own a PT PMA which may not be claimed by owners of other business entities in Indonesia. Such privileges will be detailed in the following paragraphs.

Ease of Obtaining Licenses and Permits

Just as is the case in any other country, certain business activities which are undertaken in Indonesia require one or more licenses or permits to be obtained before such activities may commence. One of the privileges in this regard which is experienced by those who own a PT PMA lies in the fact that it is much easier to obtain a particular license or permit for a PT PMA than is it for any other business entity in Indonesia. This is because the nature of a PT PMA allows for the authorities which are issuing the license to complete all necessary checks in less time than they would need if they were to do so for a different business entity. Regardless of the primary reason behind the obtaining of the license or the permit, PT PMA owners will benefit from the large amount of time saved during the application process and will thus be able to place more emphasis on the actual running of the business.

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Sponsorship of Foreign Employees

Those who own a PT PMA are also allowed to sponsor as many foreign employees as desired. Foreign employees of the PT PMA who fulfill specific criteria are eligible for a company-sponsored permit. The criteria to be fulfilled which will allow a foreign worker in a PT PMA to be sponsored by the company owner are that the foreign worker must have been living and working in Indonesia for an ongoing and continuous period of at least three years and that the foreign worker must be a president director, director, commissioner, or shareholder of the company. Should the foreign worker be a director or commissioner, the foreigner must have invested a minimum of one billion rupiah in the PT PMA’s share capital before being sponsored. Any foreign shareholder of the PT PMA who is to be sponsored by the company must