Indonesia has become an attractive destination for foreign investors looking to expand their business. The country is rich in natural resources, has a vibrant economy, and a large consumer market. However, establishing a foreign-owned company or PT PMA Indonesia in Indonesia can be a challenging process. In this article, we will guide you through the process of setting up a PT PMA Indonesia and the benefits of doing business in Indonesia.
What is PT PMA Indonesia?
PT PMA Indonesia stands for Perseroan Terbatas Penanaman Modal Asing, which means a Limited Liability Company with Foreign Investment. This type of company is established by foreign investors who want to own and manage a company in Indonesia.
A PT PMA Indonesia is required to have at least two shareholders, one of whom must be a foreigner. The foreign shareholder must own at least 10% of the company’s shares. The minimum paid-up capital for a PT PMA Indonesia is IDR 10 billion or its equivalent in foreign currency.
Requirements for Setting up a PT PMA Indonesia
Setting up a PT PMA Indonesia involves several steps, including obtaining various licenses and permits. The process can be time-consuming and complex, and it is advisable to seek the assistance of a professional service provider.
The following are the requirements for setting up a PT PMA Indonesia:
1. Business Plan
A business plan is required to demonstrate the viability of the proposed business. It should include details on the company’s objectives, products or services, marketing strategy, and financial projections.
2. Company Name
The company name must be unique and not already registered by another company. The name must also comply with the Indonesian language and should not contain any offensive or sensitive words.
3. Shareholders
A PT PMA Indonesia must have at least two shareholders, one of whom must be a foreigner. The foreign shareholder must own at least 10% of the company’s shares.
4. Paid-up Capital
The minimum paid-up capital for a PT PMA Indonesia is IDR 10 billion or its equivalent in foreign currency. The capital must be deposited in a local bank and a bank statement must be provided as proof of capital.
5. Deed of Establishment
A deed of establishment is a legal document that outlines the details of the company, including its objectives, shareholders, and capital. It must be prepared by a notary public and registered with the Ministry of Law and Human Rights.
6. Taxpayer Identification Number (NPWP)
A PT PMA Indonesia must obtain a Taxpayer Identification Number (NPWP) from the tax office. This is required for tax reporting and compliance purposes.
7. Business License
A business license is required to operate a PT PMA Indonesia. This can be obtained from the Investment Coordinating Board (BKPM). The license is valid for 3 years and can be renewed.
8. Other Licenses and Permits
Depending on the type of business, a PT PMA Indonesia may require additional licenses and permits, such as a trading license, import license, or environmental permit. It is important to check the requirements for your specific business.
Benefits of Establishing a PT PMA Indonesia
Establishing a PT PMA Indonesia offers several benefits for foreign investors, including:
1. Access to a Large Market
Indonesia has a population of over 270 million people, making it the fourth most populous country in the world. This presents a large consumer market for businesses to tap into.
2. Strategic Location
Indonesia is strategically located between Asia and Australia, making it an ideal location for businesses looking to expand their presence in the region.
3. Natural Resources
Indonesia is rich in natural resources, including coal, oil, gas, and minerals. This presents opportunities for businesses in the extractive industries.
4. Supportive Investment Environment
The Indonesian government has introduced various policies and incentives to attract foreign investment. This includes tax incentives, simplified licensing procedures, and investment protection.
Conclusion
Setting up a PT PMA Indonesia can be a complex process, but the benefits of doing business in Indonesia make it a worthwhile investment. By following the requirements and seeking professional assistance, foreign investors can establish a successful business in Indonesia and tap into its large consumer market and abundant resources.
