A PT PMA, or Perseroan Terbatas Penanaman Modal Asing in the Indonesian language, is a foreign-owned company established in Indonesia by foreign investors. Foreigners make use of PT PMAs to carry out business activities in the country as it is one of the common forms of Indonesian legal entities with the possibility of owning up to 100% foreign shares.
This article details some facts and benefits you need to know to get started with your PT PMA incorporation in Indonesia.
Benefits of Setting up a PT PMA in Indonesia
PT PMA in Indonesia offers many benefits to foreigners who wish to start their businesses in the country. This is why a great number of entrepreneurs around the globe are flocking to Indonesia.
1. Easy Permit and License Application and Acquisition
Business licenses and certain commercial and operational licenses are mandatory to run PT PMA in Indonesia based on the type of the business and legal structure. Compared to other forms of legal entities in Indonesia, PT PMA has a greater chance to obtain its licenses and permits more easily with less time and resources spent.
2. Low Import Taxes and Duties
Oftentimes, PT PMAs in Indonesia need to import materials or products from abroad to operate their businesses. Taxes and duties apply for things imported to Indonesia. However, as per Indonesian Customs Law, PT PMAs are eligible for lower taxes and duties with tax benefits.
3. Sponsorship for Foreign Employment
For positions that require special skills, PT PMA may have to hire foreign professionals to fill the positions. The good news is, PT PMAs in Indonesia can provide employment sponsorship to an unlimited number for foreign staff who have to meet the specified criteria and qualifications.
3 Important Facts about PT PMA Establishment in Indonesia
While there are a variety of things you need to consider when establishing a PT PMA in Indonesia, you shall give special attention to the following three important facts:
1. Shareholders, Directors, and Commissioners
As per Indonesian Company Law, every PT PMA in Indonesia is required to have a minimum of two shareholders, a director, and a commissioner. Both individuals or legal entities of either foreign or local nationality can be the shareholders of the PT PMA.
Also, the commissioner and the director are permitted to be the PT PMA’s shareholders. However, at least one of the PT PMA’s shareholders shall be a foreign individual or legal entity.
If the PT PMA has more than one commissioner, one of them has to be chosen as the president commissioner to be in charge of the board of commissioners (BOC). The BOC supervises the board of directors (BOD). The person who is in charge of managing the company is the director but not the commissioner.
A PT PMA’s directors are also permitted to represent the company by law, sign agreements with third parties, and handle tax documents.
2. Shares of a PT PMA
Foreign investors can own up to 100% of the shares in a PT PMA. The exact amount of shares that foreigners can own in certain industries can be found under the Negative Investment List. One thing to take note that some industries or business sectors are not open, or just partially open to foreign investment.
3. Minimum Investment and Paid-up Capital Value
The minimum investment capital to set up a PT PMA in Indonesia is IDR 10 billion to all business sectors. And the minimum paid-up capital is 25% of the minimum investment capital. However, the minimum investment value and its paid-up capital do not include the buildings and lands of the PT PMA.
How Cekindo can Assist
In response to the unfamiliarity with the legal requirements and process of setting up a PT PMA in Indonesia, Cekindo has a complete understanding of relevant rules and regulations. Our experts excel at establishing PT PMA in multiple jurisdictions.
Through our international connection and network, Cekindo offers a customised solution combined with local knowledge to make PT PMA incorporation fast and hassle-free for you.
To discuss how you can register a PT PMA in Indonesia, please complete the inquiry form below.