Establishing a business in Indonesia begins with understanding the company registration process, a critical step for foreign investors entering this fast-growing Southeast Asian market. However, successfully launching a business requires navigating legal structures, government regulations, and administrative procedures.
In this comprehensive guide, we walk you through the full journey of company registration in Indonesia.
Company Registration Step for Foreign Company (PT PMA) in Indonesia
Step 1: Onboarding and Planning
- Sign a service agreement and receive a proposal.
- Pay the invoice and submit the completed application form.
- Begin the company registration process once documents are received.
Step 2: Prepare Required Documents
- Proposed company name
- Registered office address in Indonesia
- Composition of shareholders
- Board of Directors and Commissioners information
Step 3: Sign Legal Documents
- Statement Letter confirming capital injection
- Power of Attorney to represent your interests in company registration
Step 4: Incorporation Process
- Draft and notarize Articles of Association (Akta Pendirian)
- Get Ministry of Law and Human Rights approval
- Obtain Tax Identification Number (NPWP)
- Register for Business Identification Number (NIB)
Step 5: Immigration (If Applicable)
If your director is a foreigner:
- Apply for a Work Permit (RPTKA)
- Submit IMTA notification
- Acquire Limited Stay Permit (KITAS)
Step 6: Open Corporate Bank Account
- The director must be present with KITAS or Indonesian citizenship documents (depending on the terms of each bank).
All these stages contribute to your total company registration fee, which includes professional services, licensing, and optional visa support.
Foreign Company Registration Options in Indonesia
1. Representative Office (Kantor Perwakilan Asing)
A Representative Office is an ideal initial step in market entry. It allows foreign businesses to conduct market research and promotional activities, but it cannot generate revenue or engage in direct commercial transactions.
Company registration for a Representative Office is relatively simple:
- No large capital investment required.
- Only one Chief Representative is needed to operate.
- Ideal for early-stage business development.
However, since it cannot issue invoices or earn revenue, this option is limited in scope.
2. Foreign-Owned Limited Liability Company (PT PMA)
The most common route for international investors is forming a PT PMA (Perseroan Terbatas Penanaman Modal Asing). This entity allows full operational activities, including profit generation, hiring employees, and holding assets.
The company registration process for a PT PMA is regulated by:
- Investment Law No. 25/2007
- Company Law No. 40/2007 (amended by Government Regulation in Lieu of Law No. 2/2022)
- Presidential Regulation No. 10/2021 (amended by No. 49/2021), including the Positive Investment List
Any business with foreign ownership must go through company registration as a PT PMA.
Legal and Operational Requirements for PT PMA
1. Capital Requirements
To qualify as a foreign-owned company, PT PMA must have a minimum capital of IDR 10 billion (approximately USD 750,000). Shareholders are required to submit a commitment letter stating their capital investment.
2. Shareholder and Management Structure
Each PT PMA must have at least two shareholders. These individuals may also serve as Directors or Commissioners.
3. Business Location
Businesses must operate in areas zoned for commercial use. Establishing your business in a residential area is not permitted.
Complying with these requirements is essential for successful company registration and long-term business continuity.
Conclusion
Entering the Indonesian market requires meticulous planning, regulatory compliance, and thorough knowledge of the company registration process. While a Representative Office offers simplicity and minimal investment, a PT PMA provides full operational capability and revenue generation. Regardless of the path chosen, collaborating with an experienced local partner can make all the difference.
Let CPT Corporate help you streamline your company registration in Indonesia. Contact us today to begin your business journey with confidence.
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Frequently Asked Questions (FAQ)
Can a foreigner fully own a company in Indonesia?
Yes, foreigners can fully own a company in Indonesia through the PT PMA structure, subject to the Positive Investment List. Company registration must comply with ownership limitations based on industry sectors.
What is the minimum capital requirement for company registration in Indonesia?
For foreign-owned businesses (PT PMA), the minimum capital requirement for company registration is IDR 10 billion (approximately USD 750,000). A shareholder commitment letter is required during the registration process.
How long does company registration in Indonesia take?
The company registration process in Indonesia typically takes 4–6 weeks, depending on the completeness of the documentation and the responsiveness of government authorities. Working with a professional consultant like CPT Corporate can help expedite the process.
What happens if I don’t complete company registration properly?
Failure to complete company registration correctly can result in legal complications, fines, or operational delays. It’s crucial to ensure full compliance with Indonesian laws and work with experienced professionals.
