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PT PMA Registration (Foreign Direct Investment)
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In Indonesia, foreign investment is facilitated by the establishment of a PT PMA, a specific type of legal business structure.
A Penanaman Modal Asing ( PT PMA), or foreign investment business entity, enables foreign entities to establish and own Indonesian companies. This framework supports foreign direct investment, enabling sole foreign ownership or partnerships with local investors. This corporate structure permits foreign entities to invest in, operate, and manage Indonesian businesses.
What PT PMA Can Do
- Own up to 100% of shares in certain sectors
- Operate and sell products directly in the Indonesian market
- Access various tax incentives and benefits
- Utilize advanced technology and expertise from foreign investors
- Establish a legal entity recognized under Indonesian law
What PT PMA Cannot Do
- Invest in sectors prohibited by the Negative Investment List (DNI)
- Engage in activities related to national defense and security, such as manufacturing weapons or explosives
- Conduct business without adhering to local employment regulations, including prioritizing local labor
- Operate without necessary business licenses and permits based on the sector
- Function as a mere representative office without engaging in direct business operations
What are the main benefits of setting up a PT PMA in Indonesia?
PT PMA registration caters to foreign investors aiming to establish a company or enhance their business presence in Indonesia. This framework legally enables foreign investors to engage in diverse sectors of the Indonesian economy, with certain stipulations and regulatory oversight. The following are several key advantages of establishing a PT PMA:
- One of the primary advantages of PT PMA is that it allows for foreign ownership in various sectors.PT PMA's key advantage lies in its enabling foreign investment in diverse sectors. Unlike typical Indonesian PT companies, which are restricted to Indonesian owners, PT PMAs permit foreign investors to own a majority or all of the company. depending on the sector and prevailing regulations. This provides greater control and flexibility for foreign investors in managing their businesses.
- Similar to Indonesian PT companies, PT PMA has access to a wide array of business sectors within Indonesia. This development broadens market access for foreign investors in Indonesia.
- PT PMAs benefits from Indonesian law's protection as a registered foreign entity. This protection covers property and intellectual property rights, contracts, and access to dispute resolution.
- A PT PMA structure enables FDI companies to integrate their global brand recognition with the norms of the Indonesian market.
Document Requirements
- A copy of the Article of Establishment, the Approval letter from the Ministry of Law and Human Rights, a Domicile Letter, a Tax ID, and other supporting licences.
- A minimum of 2 shareholders with minimum paid-up capital of IDR 10 billion (about USD 660,000).
- Foreign shareholders provide valid passport.
- Indonesian shareholders provide KTP/NPWP (individuals) or company documents (articles, amendments, approvals, domicile, tax ID, license, TDP/NIB)
- Identity and contact details of Company Directors and Commissioner
- Other required documents
Register a PT PMA in Indonesia with LMI Consultancy
- Consult your inquiry with our professional consultant
- Submit necessary document
- Proceed with the payment
- Application process
- Receive the complete document
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Setup a Business in Indonesia with LMI Consultancy
Established in 2016, LMI Consultancy has been supporting countless individuals in understanding the intricacies of visas, business setup, tax & accounting, and property investment in Indonesia, providing a comprehensive and dependable service.
We take pride in being an ethical and innovative company that places a strong emphasis on exceptional customer service and strives to set a new standard in our industry, guaranteeing a smooth and encouraging experience for our clients.
FAQ
What's the minimum initial capital investment that PT PMA shareholders need to contribute?
Specifically, shareholders need to provide a capital of IDR 10 billion (about USD 660,000). This plan outlines how the company will allocate its capital and resources for its operational activities.
Who can represent the ownership of the foreign investment company?
Determining ownership representation in Indonesian foreign investment companies is complex, varying based on specific regulations. Although some nominee arrangements offer flexibility, restrictions apply, particularly to sectors on the Negative Investment List. To properly address this, you should seek advice from legal and business professionals with Indonesian law expertise.
Do Indonesian PTs, PT PMAs, and other business types face the same tax requirements?
No, the tax burden isn’t uniform across all business types in Indonesia. The tax responsibilities of PT PMAs and PTs include corporate income tax, withholding tax, and VAT, additionally include LKPM for PT PMA. Meanwhile, the Representative office only files withholding tax and LKPM report.
Disclaimer : Our services in LMI Consultancy provide consulting services focused on ensuring client compliance with applicable immigration and legal regulations in Indonesia. We do not provide or facilitate the production of official government documents, nor do we offer any expedited or preferential access to government services.
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