Expanding to Indonesia in 2026?
Everything you need to set up a PMA in Indonesia.
Indonesia is no longer just “emerging” market on the world stage. Latest reports is that Indonesia will be the fourth largest economy in the world by 2040. With over 275 million people, rising middle-class consumption, digital acceleration, and strong international trade ties, more founders and investors are asking:
“How do I properly set up a company in Indonesia?”
The answer, in most cases, is a PT PMA. This article gives you a clear, practical overview — and at the end you’ll find structured intake forms so you can take the next step with confidence through Gareth Benson Principal of IP Assist and our strong relationship with Malekat Hukum and other local partners
What Is a PT PMA?
A PT PMA (Perseroan Terbatas Penanaman Modal Asing) is a foreign-owned limited liability company in Indonesia offers exciting opportunities for foreign investors.
A PMA refers to a Foreign-Owned Company that operates under Indonesian law and is legally established for foreign investment. With the establishment of a PMA company foreign investors can ear profits or revenue directly from the PMA rather than local subsidiaries.
It allows non-Indonesian investors to:
- Operate legally in Indonesia
- Hold up to 100% ownership (sector dependent)
- Invoice in IDR
- Open corporate bank accounts
- Sponsor foreign directors or investors
- Apply for an Investor KITAS
For anyone serious about operating in Bali, Jakarta, or elsewhere in Indonesia — this is the correct vehicle.
Company Structure:
Under Indonesian law, foreign investment companies (PMAs) must be set up as Limited Liability Companies (PTs).
Business Licences for PT PMA
Businesse licensing in Indonesia falls into two main categories:
- Risk - Based Licensing: based on the risk level of business activities, evaluating potential hazards and their impacts/.
- Licensing to Support Business Activities: legal permits that enable businesses to operate smoothly.
To start a business entrepreneurs must meet these requirements:
- Basic Requirements: Compliance with spatial planning, environmental approval, and building permits.
- Risk-Based Licensing:
Low Risk: Requires a Business Identification Number (NIB)
Medium Risk: NIB and a standard certificate
High Risk: NIB and a licenses
Foreign owner companies (PMA) licenses are issued via the Online Single Submission (OSS) system)
2025/2026 Capital & Ownership Standards
The following rules apply to the capital requirements for a PMA setup please note these revised totals in 2025 and 2026 for minimum capital requirements
Total Investment Value: Your investment plan must exceed IDR 10 Billion (approx. USD 650,000+) per 5-digit KBLI business code. This includes fixed assets, equipment, and working capital, but excludes land and buildings for most sectors.- Minimum Paid-up Capital: To facilitate SMEs, the mandatory paid-up capital has been reduced to
IDR 2.5 Billion (approx. USD 160,000+).
- The 12-Month Rule: To prevent "shell companies," this capital must remain in the corporate account for at least 12 months unless used for verified business operations. Regulators may require evidence that paid-up capital reflects genuine operational readiness and is not nominal in nature.
| Metric | 2024 Standard | 2025/2026 |
|---|---|---|
| Min. Paid-up Capital | IDR 10 Billion | IDR 2.5 Billion - 10 Billion per classification (Per BKPM Reg 5/2025) |
| Total Investment | IDR 10 Billion+ | IDR 10 Billion+ (Excluding Land/Buildings) |
| Ownership Method | 100% Direct Foreign Ownership (PMA) | 100% Direct Foreign Ownership (PMA) |
| Licensing Logic | Generic Permits | Risk-Based (Low to High) |
Structural Requirements
To comply with the Indonesian Company Law, a PT PMA must maintain the following hierarchy:
- Shareholders: Minimum of two (individuals or corporate entities).
- Board of Directors: Minimum of one Director. Foreign Directors residing in Indonesia must hold a valid KITAS.
- Board of Commissioners: Minimum of one Commissioner to supervise the Board. They may reside abroad if they do not perform executive duties.
The Incorporation Roadmap
The process typically takes 4-6 weeks to reach the operational stage. This includes the following consideration.
- Name Reservation & Deed: Selection of a unique three-word name and drafting the bilingual
Deed of Establishment.
- MoLHR Approval: Formal legal entity status issued by the Ministry of Law and Human Rights.
- Tax Registration (NPWP): Essential for corporate banking and VAT compliance.
- OSS-RBA Registration (NIB): Obtaining your Business Identification Number, which acts as your primary license and import ID.
- Capital Injection: Opening the corporate bank account and depositing the IDR 2.5 billion paid-up capital.
Critical 2026 Compliance Updates
- KBLI 2025 Transition: All companies must align their business activities with the new 2025 classification codes by
June 18, 2026, to avoid NIB suspension.
- Investor KITAS (Index 313/314): While the entry capital is lower, an individual must still hold at least
IDR 10 Billion in personal share value to qualify for a 2-year residency permit.
- Physical Office Mandate: High-risk sectors and certain consultancies now require a physical office with a verified building permit (PBG) rather than a virtual office.
The Legal Framework
The legal framework of PMA Indonesia includes:
- Law No. 25 of 2007 on Investment
- Law No. 40 of 2007 regarding Limited Liability Companies
- Government Regulation No.5 of 2021 regarding Risk-Based Licensing
- Presidential Regulation No. 10 of 2021 regarding Investment Business Fields, amended by Presidential Regulation No. 49 of 2021
- Minister of Law and Human Rights Regulation No. 21 of 2021 on the Terms and Procedures for Registering, Amending, and Dissolving Limited Liability Company Entities
Ready to Begin Your Expansion?
The regulatory environment in Indonesia is moving fast. Whether you are planning a PT PMA setup or require assistance our team is here to guide you through the legal complexities.
Click here to fill out the form and set up an online consultation .
To receive the PT PMA 2026 Setup Checklist, please express your interest in the message and we will send it to you.
