Company Formation in Indonesia

Opening a PT PMA in Indonesia is the first step toward operating your business legally.

We form and license companies even when the planned activities are complex, specialized, or require a mix of licenses. Our team includes Indonesian and international lawyers who can develop solutions for cases that do not fit a standard template.

PT PMA, or Perseroan Terbatas Penanaman Modal Asing, is Indonesia's foreign-investment company structure, comparable to a limited liability company. Any company with foreign investment, whether foreign ownership is 1% or 100%, is treated as foreign-owned.

Benefits of opening a company in Indonesia

• Operate legally in Bali and elsewhere in Indonesia, earn revenue, and grow the business
• Access most business activities
• Open a multicurrency corporate bank account
• Sponsor Investor KITAS permits for founders and dependent Family KITAS permits for eligible relatives
• Complete the entire process online by power of attorney, without being physically present in Indonesia
• Complete a standard turnkey registration in approximately two weeks

Requirements for PT PMA registration

• At least two founders: either two foreign nationals, or one foreign national and one Indonesian national
• A genuine intention to conduct business in Indonesia
• Planned activities that are open to foreign-owned companies; we help select the appropriate business classifications to preserve the highest legally available foreign ownership

Registration process

1. You discuss your future business with our specialist by messenger, by phone, or in person at our office.
2. You provide the founders' personal documents, and we begin preparing the incorporation documents.
3. Within 2-3 business days, we arrange signing at our office or remotely.
4. After the constitutional documents are issued, we register the company with the Ministry of Law, obtain the operating license for the primary activity and the tax number, and arrange the company seal.
5. We notify you when everything is ready and deliver the documents by courier at no additional charge, or you can collect them from our office.

After the company is formed

For the company to operate entirely within the law, the following steps are also required:

• The president director must obtain an Investor KITAS, which can be started immediately after company registration.
• After receiving the Investor KITAS, the president director must obtain a personal NPWP tax number.
• The director must open an Indonesian bank account.
• The company must sign an agreement with a tax consultant or accountant so tax and investment reports are filed on time.

Business licensing

You may list all potentially relevant business activities in the company's articles of association, but that does not mean the company can immediately perform every listed activity. Each activity the company actually conducts requires its own operating license. The license for the primary activity is included in the company formation package and normally takes one business day.

Activities the government treats as specialized, such as selling alcohol or tobacco and producing food, require additional licenses. The process is not immediate and can require additional permits, certificates, and premises inspections.

Who can work in the company?

The founders are appointed as president director and commissioner. The president director has signing authority and the authority to manage the company, hire employees, and control the bank account. The commissioner is a shareholder and supervisor with voting rights at shareholder meetings.

When there are more than two founders, for example three, the roles may be distributed as president director and two commissioners, or as president director, director, and commissioner.

Neither the president director nor the commissioner is treated as an employee of the company. The president director is the company's official representative and is responsible for key decisions involving financing, investment, and partnerships; business strategy; compliance with tax, environmental, and other laws; reporting; risk management; communication with shareholders, employees, clients, partners, and government authorities; and transparency in the company's actions and decisions.

Indonesian employees can work in positions created and supervised by the president director. The company can hire an essential foreign specialist, such as an operations manager, when it employs at least five Indonesian employees.

PT PMA taxes

During the first three years after formation, the company may use a reduced tax rate of 0.5% of gross revenue. It may instead move immediately to the standard system, under which tax is 11% or 22% of profit.