Guide to Indonesia Company Registration

How to Register a Company in Indonesia: A Complete 2025 Guide

 

A Comprehensive Guide to Registering Your Indonesian Company

Indonesia, an archipelago situated between the Indian and Pacific Oceans in Southeast Asia, is the world’s fourth-most populous country and ranks prominently in the regional economy after China, Japan, and India. These factors make Indonesia a compelling destination for foreign investment and business expansion. 

While company registration in Indonesia is generally straightforward, strict adherence to local legal and regulatory requirements is essential for successful incorporation of companies in Indonesia and long-term compliance. If you plan to set up a company in Indonesia, this comprehensive Indonesia company registration guide is a crucial resource.

 

 

 

What You Need to Know Before Your Indonesia Company Registration?

Indonesia, as a member of the Association of Southeast Asian Nations (ASEAN)—which includes Brunei, Cambodia, Laos, Malaysia, the Philippines, Singapore, Myanmar, Thailand, and Vietnam—benefits from favourable regional trade arrangements. These include low or zero tariffs, creating a highly advantageous environment for cross-border commerce. 

Businesses established in Indonesia can leverage these benefits throughout Southeast Asia while enjoying reduced tax burdens. This regional integration grants access to a combined consumer market of over 667 million people.

Additionally, Indonesia’s strong international trade relationships with countries such as China, India, Japan, South Korea, Australia, and New Zealand further enhance its position as a strategic hub for global business expansion.

Indonesia operates within a structured bureaucratic framework, particularly in matters related to foreign investment. The Indonesia Investment Coordinating Board (Badan Koordinasi Penanaman Modal or BKPM) oversees and regulates all foreign investment activities in the country. 

Company establishment in Indonesia is governed by Company Law No. 40 of 2007, which was subsequently amended through the Omnibus Law on Job Creation (Law No. 11 of 2020), enacted on 2 November 2020. These legal frameworks ensure that all business operations comply with national standards while promoting investment and economic growth.

 

How to Register a Company in Indonesia?

Establishing a company in Indonesia begins with selecting and obtaining approval for your proposed company name. Once approved, a Deed of Establishment must be executed with the assistance of a registered public notary. The notary is responsible for drafting the company’s Articles of Association in accordance with Indonesian law. To comply with legal requirements and facilitate successful company registration, Articles must include the following specific mandatory information:

• Company name
• The company’s place of domicile
• The company’s objectives, i.e. business activities or line of business
• Capital details (i.e. authorised capital, paid-up and issued capital)
• Value and amount of company shares
• Minimum 2 shareholders
• Minimum 1 director & 1 commissioner (the director and commissioner cannot be the same person)
• Duties and responsibilities of the director & commissioner
• Location of shareholders’ meetings
• Method of conducting shareholders’ meetings
• Procedure of distribution and use of the company’s dividends and profits

 

Key Requirements for Company Registration in Indonesia

To register a company in Indonesia, your business name must meet specific legal criteria, such as:

1. The company name must be written using Roman letters.
2. It must not be identical or substantially similar to any existing registered company name in Indonesia.
3. The name must not violate public order or accepted moral standards.
4. The name must not resemble or imitate the names of state bodies, government agencies, or international organisations—unless formal permission is obtained from those entities.
5. The name cannot consist solely of numbers or random sequences of letters and numbers that do not form a meaningful word.
6. The official company name must contain at least three distinct words.
7. Foreign-owned companies (PMA) are allowed to use English in their official company names.
8. The registered official name is used solely for legal purposes. Companies may choose a separate brand or trade name for marketing purposes that better aligns with their products or services.

 

Documents Required for Company Registration in Indonesia:  

To apply for a company registration number and the relevant licenses, you will need the Deed of Establishment, approval from the Indonesian Ministry of Law and Human Rights (“MOLHR”) and the identification documents of all the shareholders, directors & commissioners. If the shareholder is a company, you must provide the Deed of Establishment, MOLHR’s approval, with all the corporate shareholders’ amendments (if any), and all business licenses.

Based on the BKPM guidelines, PMA companies are required to register for a minimum authorised capital of not less than IDR10,000,000,000/-, with 25% of the authorised capital as the minimum paid-up capital. There are two alternative ways to demonstrate to the relevant authorities the existence of the minimum paid-up capital:

1. Furnishing a Capital Statement Letter stating that the shareholders have sufficient funds to inject the capital after the incorporation; or
2. Depositing the money in the company’s bank account

All shareholders are required to sign the Articles of Association in the presence of a notary public. If a shareholder is unable to be present, they may appoint a power of attorney to sign the document on their behalf.

The Articles of Association will be submitted to the MOLHR by the notary public. Upon approval, you will be issued with the Deed of Establishment with the MOLHR approval.

Suppose you need to amend any information in your company’s Articles of Association after the Deed of Establishment with the MOLHR approval is obtained. In that case, you will need to prepare a Deed of Amendment for approval at a shareholders’ meeting. You must engage the services of a notary public to prepare the Deed of Amendment.

 

Requirements for Foreign-Owned Businesses:

If you are a foreigner, you need to determine the best legal entity suitable for your business.  you need to determine the best legal entity suitable for your business before you incorporate a business in Indonesia. You will also need to identify the industry in which your business will be involved.

An official business name in Indonesia must fulfil certain criteria such as it must be written in roman letters; it is not the same or substantially the same with a company name which is lawfully used by another company; it is not contrary to public order and/or morality, it is not the same or similar to the name of the state bodies, government bodies, or international bodies, unless it obtained permission from such bodies; it does not consist of numbers or series of numbers, letters or series of letters that do not form a word; it contains at least three words, etc. A PMA is allowed to have English word for their company name. Official company names are only used for legal purposes. You may choose to register another name that is more distinct to your product or brand if needed.

To establish a PMA company, it is possible that the director and commissioner members are all foreigners. However, for the practicality of business operations, it is recommended that the company also appoint a local director. In the absence of a regional director and if the foreign directors do not have work permit and Tax ID, the business operation in Indonesia including the signing of documents such as for bank account opening, Electronic Tax filing system (“EFIn”) registration, etc, will be limited.

The registration of EFIn will require that the foreign director has a TAX ID and Personal EFIn which can only be obtained if the foreign director has a Work Permit. With a work permit, the foreign director will need to obtain a personal Tax ID (Tax resident). With the Tax ID, the foreign director can enjoy the local tax rate for their income tax in Indonesia. A foreigner who does not have a Tax ID will have a 20% tax cut on their income tax.

If the foreign director or commissioner will not be stationed in Indonesia to work, it is recommended that one of them apply for a KITAS after all the processes have been completed if they would like to visit Indonesia frequently to supervise and monitor their business. Otherwise, they may face entry issues at the Indonesian customs when setting up a company.

If you are a foreign director, the identification documents required include:

• Passport
• Tourist Visa only if you will visit Indonesia rarely
• Business Visa if you already have potential clients and will have several meetings in Indonesia
• KITAS (Temporary Permit) if you already have established a company in Indonesia and want to have regular meetings in Indonesia
• IMTA (Working Permit) if you sit and work daily in your office/company in Indonesia

 

How Can Foreign Investors Comply With the DNI Requirements in Indonesia?

To determine if the sector is open to foreign investment and the percentage of foreign ownership requirement, you can refer to the Indonesia Negative Investment List (“DNI”),. This list is made to protect the Indonesian economy and provide more business opportunities to investors. It is a list of business sectors that lets investors know which sectors they are allowed to invest in, and their regulations, especially regarding share ownership. 

 

If your company is a Foreign Investment Company (“PMA”) with 100% foreign ownership but is involved in any business that is listed in the DNI, which requires you to have a local shareholder based on the percentage requirement mentioned in the DNI, you will need to hold a general meeting of shareholders (“GMOS”) to approve the deed of amendment with the following agenda:

1. Change the shareholders’ composition.
2. Change the authorised capital, issue and paid-up capital (if necessary)

If your company is a local company and a foreign investor would like to put a share/invest as a shareholder in your company, you will also need to hold a GMOS to approve the deed of amendment with the following agenda:

1. Change the company registration status
2. Change the shareholders’ composition
3. Change the authorised capital, issue and paid-up capital

For both situations above, you may also need to change your business licences.

 

What are the Types of Companies in Indonesia?

Indonesia considers all foreign companies as PT PMAs (Perseroan Terbatas Penanaman Modal Asing). A common misconception is that foreign ownership means a smoother registration process. However, this is untrue because the registration process in Indonesia will be smoother only if there is a local partner with 100% share ownership.

To incorporate a business in Indonesia, you can choose from the following types of entities:

Company Type and Structure	Suitable For	Advantage	Disadvantage
Local Company (PT)	Foreigners who want to do business in Indonesia. They have the option to conduct business as a local or a foreign investor using a local director.   Requires a minimum of 2 shareholders (individuals or companies).   Licensing handled through Online Single Submission (OSS).	Not subject to strict limits and requirements like foreign entities.	100% local ownership only
Foreign-Owned Company/Limited Liability (PT PMA)	Foreigners who want 100% ownership of the company.   Requires a minimum of 2 shareholders (individuals or companies).   Licensing handled through Online Single Submission (OSS).	100% foreign ownership allowed. You have the same rights and responsibilities as local companies.   Able to participate and join tenders locally.   Able to apply for business licences and import.   Able to apply for product registration.   Foreign employees can apply for KITAS (a limited stay permit in Indonesia or a temporary residency permit that is valid for six months to one year) or a work visa.   Able to sponsor business visas for visitors and foreign clients under your company.   Even 1% foreign ownership can be considered a PT PMA.	Maximum ownership (foreigners) will be decided by the business activities and sector through the Negative List.   Restrictions are provided in the Indonesia Negative Investment List.
Representative Office	A branch of the overseas parent company. The first step for investors who want to enter the local market.   Set up for marketing activities purposes, preparing to establish a PT PMA or for market research.	Ideal option for testing the local market. Focus on research to help you determine the next step forward.   No minimum capital.   No shareholder or director required.   No commissioner required.	Direct selling or revenue generation is not permitted.   A coordinator, supervisor, or representative has a limited role.

 

Alternatively, there are other options besides the three primary entities above. These options include:

• Purchasing a ready-made shelf company. This will allow you to skip the company registration process.

• Nominee Company – The nominee company will act as the registered owner on behalf of the real owner. If you choose this option, it is essential to source a partner who will have your best interests at heart.

Generally, the cost of setting up an Indonesian company starts from US$1,500. This is for a local company (PT company) that is based in Jakarta. The cost will differ based on the type of business entity, the location you choose and the service provider you engage.

 

What is the Registration Timeline and Procedure for companies in Indonesia?

In Indonesia, there are three entity options for investors to register their Indonesian company:

• Representative Office
• Local Company (PT)
• Limited Liability Company (PT PMA). This entity is also referred to as a Foreign Direct Investment Company.

Your company can be registered within a month or 1.5 months. Once fully registered, you can immediately commence business operations in Indonesia. You can open a bank account under the company’s name by submitting your Deed of Establishment and all your completed business licences to the preferred bank.

Most businesses in Indonesia can be established through the OSS system, which makes the process quicker and easier. To establish a PMA company in Indonesia, these are the requirements involved:

Step 1 –  Approval of Company Name and Acquiring Deed of Establishment	Choosing the right classification for your business is an important first step. This will ensure that you don’t encounter problems later.   Company name approval takes one business day. The place of domicile, or your office registration address, is required.   You will need to execute a Deed of Establishment. This can be done in two to three days.   The Deed of Establishment must be certified by the Ministry of Law and Human Rights. This can be done in 3 days after the submission of the deed of establishment to the MOLHR.   3E Accounting will assist with checking your intended business activities and recommend the best course of action.
Step 2 – Processing the Domicile in the Local District Office (only applies for areas outside Jakarta)	Requires Deed of Establishment, MOLHR Approval, rental office agreement, and ID of director. This takes 2-3 days.
Step 3 – Registering for Taxes	Acquire a Tax Identification Number (NPWP). This can be done at the local tax office.   This process can be done in 2 days. To receive the original card depends on the schedule from the Tax Department.
Step 4 – Registering for Business Identification Number	To operate in Indonesia you need an Identification Number or Nomor Induk Berusaha (NIB)   You will need to register your company with the OSS. Once done, you will receive your NIB. This can be done in two days.   NIB will serve as your Import Licence, Customs Identification Number (NIK), and Business Registry Number.   NIB will automatically register your business under the Health and Social Security System (BPJS Kesehatan dan BPJS Ketenagakerjaan) and LKPM (Investment Report), which you can process later.
Step 5 – Acquiring Operational and Commercial Licence	This is usually issued on the same day as your NIB.   Applicable if your business has no further requirements. Certain business activities may need additional fulfilment, in which case licences can take months to be approved.

 

This registration timeline procedure applies to businesses based in Jakarta as an example. For other areas of Indonesia, the registration may take longer. The timeline above is merely an estimate, as the nature of your business may affect the registration speed, too.

 

What are the Post-Registration Formalities Involved in Indonesia?

Once successfully registered, you can start business operations in Indonesia. You will be able to conduct the following activities on behalf of your company:

• Opening a bank account under your company
• Purchase assets and property
• Hire staff
• Join a tender
• Obtain permits for any foreign employees
• Obtain operating business licences (if needed)
• Obtain the company regulation (“PP”) when you have a permanent employee already
• Report your investment report to BKPM on a quarterly basis (it’s called LKPM – Laporan Kegiatan Penanaman Modal)

Anytime you would like to change the company information that was stipulated on your Deed of Establishment, you will need to engage a Notary Public to do the amendment. All company shareholders are to sign the form of amendment at the General Meeting of Shareholders, and the Notary will process the Deed of Amendment.

For your easy reference, please see the table below for a summary of the company registration requirements in Indonesia

Type of Company	Position	Local /Foreigner	Requirement Document	Document to Sign	Presence	Absence
Local	Director	Indonesia Citizen	KTP & NPWP (ID & Tax Card)	Statement Letter Opening a Bank Account	No need
	Director	Foreigner (possible, but this is not preferable since you might find obstacles when your company apply for a business licence, also depends on your authorised capital and line of business from your company)	Passport	Statement Letter	No need
	Commissioner	Indonesia Citizen	KTP & NPWP (ID & Tax Card)	Statement Letter	No need
	Shareholders	Indonesia Citizen	KTP & NPWP (ID & Tax Card)	Notary Deed & Statement Letter	Physical in front of Notary for signing the Notary Deed	Provide power of attorney, the attorney needs to provide ID
	Shareholders	Local Company	·     Deed of Establishment & MOLHR Approval ·     Each Deed of Amendment & MOLHR Approval ·     Business Licences (domicile, NIB, NPWP)	Notary Deed & Statement Letter	Physical in front of Notary (One Director of the Local  Company) for signing the Notary Deed	Provide power of attorney, the attorney needs to provide ID
PMA (Foreign Company)	Director	Foreigner	Copy of Passport	Statement Letter	No need
	Commissioner	Foreigner	Copy of Passport	Statement Letter	No need
	Director	Indonesia Citizen	KTP & NPWP (ID & Tax Card)	Statement Letter & Opening a Bank account	No need
	Commissioner	Indonesia Citizen	KTP & NPWP (ID & Tax Card)	Statement Letter	No need
	Shareholder	Privateindividual (Indonesian citizen)	KTP & NPWP (ID & Tax Card)	Notary Deed & Statement Letter	Physical in front of Notary for signing the Notary Deed	Provide power of attorney, the attorney needs to provide ID
		Private Individual (Foreigner)	Copy of Passport	Notary Deed & Statement Letter	Physical in front of Notary for signing the Notary Deed	Provide a power of attorney that is notarised by Public Notary overseas, the attorney needs to provide ID
		Local Company	·     Deed of Establishment & MOLHR Approval ·     Each Deed of Amendment & MOLHR Approval ·    Business Licences (domicile, NIB, NPWP)	Notary Deed & Statement Letter	Physical in front of Notary (One Director of the Local Company) for signing the Notary Deed	Provide power of attorney, the attorney needs to provide ID
		Foreign Company	·     Eg.. Singapore ACRA BizFile ·     Memorandum And AoA	Notary Deed & Statement Letter	Physical in front of Notary (One Director of the Foreign Company) for signing the Notary Deed	Provide a power of attorney that is notarised by a public notary overseas, the attorney needs to provide ID

 

What is a PMA Company in Indonesia?

As of the first quarter of 2021, Foreign Direct Investment (FDI) in Indonesia has risen to USD7.72 billion. This is a year-on-year rise of 14% and clearly indicates that FDI is gaining traction in Indonesia. Therefore, establishing a PMA Company in Indonesia is the most viable way for foreign investors to do business here.

Any foreign-owned company is known as a PMA (Penanaman Modal Asing) or PT PMA (Perseroan Terbatas Penanaman Modal Asing). PTs are limited liability companies, and with foreign direct ownership, the addition of PMA modifies the company’s legal entity status. PMA type of companies allows foreign investors to generate income and earn revenue in Indonesia legally.

Previously, incorporating a company and doing business in Indonesia has not been a straightforward activity. The lack of codification and transparent governance, and administrative bureaucracy have been a constant headache for foreign investors. However, the introduction of several economic reforms now facilitates the ease of doing business in Indonesia, including the Omnibus Law.

In particular, Presidential Regulation 10 of 2021, which came into effect in March, opened up more sectors to foreign investors. This regulation, which acts as an antithesis to the Negative Investment List, allows 100% foreign investment unless expressly limited. Thanks to this ‘positive investment list’, it is now easier and more viable to establish PMAs in Indonesia.

 

Ready to Incorporate Your Indonesian Company?

Looking for help on how to incorporate a company in Indonesia, 3E Accounting is always there for you. Get in touch with our friendly consultants and let us help you prepare for your Indonesia company registration process.

Frequently Asked Questions