What Is a PMA?
A PMA (Penanaman Modal Asing) is a foreign-owned limited liability company established under Indonesian law. It allows foreign individuals or legal entities to legally conduct commercial business activities in Indonesia, including Bali.
Through a PMA, foreign investors can:
- Operate and profit from business activities in Indonesia
- Apply for an Investor KITAS (Temporary Stay Permit) for residency
- Enjoy up to 100% ownership in sectors open to foreign investment
This sets it apart from a Local PT (Perseroan Terbatas), which requires 100% Indonesian ownership and does not allow foreign shareholders.
✅ In a PMA, foreign shareholders can be either individuals or corporate entities.
PMA vs. Representative Office
If your goal is only to represent a foreign company in Indonesia — without conducting income-generating activities — a Representative Office (KPPA) may be more suitable. This structure allows presence but prohibits revenue from local operations.
How Much Investment Is Required?
To establish a PMA, the following capital requirements apply:
- Minimum Authorized Capital: IDR 10,000,000,000 (approx. USD 650,000)
This is stated in the official company documents during the establishment process.
- Minimum Paid-Up Capital (Practical Requirement):
You are expected to deposit at least IDR 1,000,000,000 (approx. USD 65,000) into the company’s Indonesian bank account within the first year of operation.
⚠️ While the law does not impose a strict deadline for realizing this investment, it is highly recommendedto meet this requirement within the first year to avoid issues during audits or government inspections.
What Types of Businesses Can You Set Up with a PMA?
Indonesia offers extensive opportunities for foreign investors through its PMA (Foreign Investment Company) scheme. With over 500+ business sectors available, foreign nationals can establish a wide range of businesses, as long as they comply with government regulations.
Understanding the KBLI System
All business classifications in Indonesia are regulated under the KBLI — Klasifikasi Baku Lapangan Usaha Indonesia(Indonesia Standard Industrial Classification).
The KBLI is a comprehensive coding system developed by BPS (Central Bureau of Statistics), referencing international standards such as:
- ISIC (International Standard Industrial Classification)
- ACIC (ASEAN Common Industrial Classification)
- EAMS (East Asia Manufacturing Statistics)
The KBLI standardizes business activities across the country and is required for legal documentation such as the Company Deed (Akta Pendirian) and NIB (Business Identification Number).
How to Choose Your KBLI Code?
When establishing your PMA, you’ll need to:
- Identify the business activity you plan to engage in.
- Match it with the appropriate KBLI code.
- Register it in your Deed of Establishment and obtain your NIB.
Visit our blog to discover the most promising and profitable sectors in Bali for foreign investment.
What Is an NIB (Business Identification Number)?
The NIB (Nomor Induk Berusaha) is a 13-digit number that serves as a company’s official identity in Indonesia. It is issued through the OSS (Online Single Submission) system and is required to:
- Operate legally
- Obtain additional business permits
- Register for tax and customs
- Open a corporate bank account
Foreign Investment Limitations: The Negative Investment List
While PMAs allow for up to 100% foreign ownership in many sectors, some business fields are restricted or limited.
These restrictions are listed under the Negative Investment List, which is regulated and updated regularly by the Indonesia Investment Coordinating Board (BKPM).
💡 It’s crucial to consult the latest Negative Investment List to ensure that your chosen business field permits foreign ownership and to what extent (100%, 67%, 49%, etc.).
Can I Own Property or Land in Indonesia with a PMA?
Foreigners cannot own freehold property in Indonesia. However, owning property through a PMA (Foreign-Owned Company) is the safest and most legal method for foreign nationals to invest in land or property.
✅ What Property Rights Can a PMA Hold?
A PMA can legally acquire:
- Hak Guna Bangunan (HGB) – Right to Build
- Hak Pakai – Right to Use
These titles allow you to:
- Own the property for an initial 30 years
- Extend for two additional 20-year terms
- Enjoy legal clarity and full control of the asset under your company’s name
🧾 We highly recommend performing Legal Due Diligence before purchasing any property to ensure:
- All documents are genuine
- The land is not under dispute
- The seller has legal rights to the property
Our Due Diligence Service costs IDR 10,000,000 and includes full legal verification, documentation checks, and assistance with the notarial process.
How Long Will I Own the PMA?
There is no expiry date for a PMA as long as the company remains active. Your business license is valid indefinitely, provided that:
- You continue business operations
- You comply with Indonesian corporate regulations
How to Set Up a PMA?
To establish your PMA, you will need:
👥 Company Structure
- Minimum 2 shareholders (can be individuals or legal entities)
- 1 Director – responsible for daily operations and management
- 1 Commissioner – oversees and advises, but cannot be operational
🗂️ Shareholders can hold as little as 2% ownership, but only shareholders with at least 10 million IDR in shares are eligible for an Investor KITAS.
🌎 Remote Setup
You do not need to be in Indonesia during the setup process. Our legal team can handle everything remotely, including document processing and notarial registrations.
What Documents Are Required?
Here’s what you’ll need to provide:
- Company Name: Must contain a minimum of 3 words, no symbols, and no use of terms like “company,” “LTD,” “co,” or “enterprise.”
- KBLI / Business Fields: Choose up to 5 business activities, each defined by a KBLI code (refer to OSS system for valid options)
- Corporate Structure: Names and passport scans of all shareholders and directors
- Passport Validity: Each passport must be valid for at least 12 months for KITAS purposes
PMA Tax & Reporting Obligations
Once your PMA (Foreign-Owned Company) is fully established in Indonesia, you are legally required to fulfill both investment reporting and tax reporting obligations in accordance with Indonesian regulations.
📌 LKPM Report (Investment Activity Report)
The LKPM (Laporan Kegiatan Penanaman Modal) is a mandatory quarterly report submitted every 3 months to Indonesia’s Investment Coordinating Board (BKPM).
It details:
- Capital investment activities
- Project progress
- Employment data
💼 Even if no activity occurs during the quarter, a zero report is still required.
Annual Tax Reporting
Your company must also submit an annual tax report between March and April each year.
To do this, you will need to provide:
- Your company bank statement covering January to December of the previous year
- Other relevant financial documents
📢 If you’d like our team to assist with the tax reporting, we kindly ask that you submit your request by February at the latest to ensure a timely process.
Alternatively, you’re welcome to appoint your own tax consultant. We will gladly provide any necessary documents they may require.
Tax Rates (PMA Corporate Tax)
1. Startup / Small Business Rate
For the first 3 years, your PMA will benefit from a reduced tax rate:
0.5% of gross revenue, applicable only if annual revenue is less than IDR 4.8 Billion
2. Standard Corporate Rate
If your revenue exceeds IDR 4.8 Billion or after 3 years of operation:
You’ll be taxed 11% of net profit as per standard Indonesian corporate tax regulations
PMA Setup Price & Inclusions
Our all-in-one fee for setting up a PMA is:
IDR 18,500,000
(Eighteen million five hundred thousand Indonesian Rupiah)
✅ Included in the Price:
- Company Name Approval
- Deed of Establishment issued by Notary
- Legal Entity Approval from the Ministry of Law and Human Rights (SK KEMENKUMHAM)
- Tax ID Number (NPWP) Registration
- Virtual Office Address (in Badung Regency, Bali)
- Business Identification Number (NIB) and relevant Business Licenses via OSS system
(including SPPL, PKKPR, K3L, etc.) - Assistance with opening a Company Bank Account
📄 Please note: All official documents will be issued in Bahasa Indonesia.
Should you require a translation, we recommend using a certified (sworn) translator at your own cost once the PMA setup is complete.
What Types of Stay Permits (KITAS) Can You Have Under PMA Sponsorship?
A PMA (Foreign-Owned Company) can sponsor several types of KITAS depending on your role and level of investment in the company:
🔹 E28A General Investment KITAS (2-Year KITAS)
If you hold personal shares worth at least IDR 10,000,000,000 (Ten Billion Rupiah), you are eligible to apply for the E28A Investment KITAS.
Key Benefits:
- Valid for 2 years
- Allows you to reside in Indonesia full-time
- Permits you to act as a Commissioner or Director in your own PMA
💡 This is the ideal KITAS for passive investors or shareholders who are involved at a strategic level.
🔹 E25 Working KITAS (1-Year KITAS)
If you plan to work full-`time in operational or managerial roles within your PMA (e.g., CEO, Manager, Supervisor), you can apply for the E25 Working KITAS.
Key Benefits:
- Valid for 1 year and renewable
- Designed for active roles within the company (not just shareholders)
- Covers positions such as: E25 – Executive and E25A–F – Commissioner, Director, Manager, etc.
📌 This KITAS requires a work permit (IMTA) and compliance with local manpower regulations, including salary minimums and insurance contributions.
