Why should I start a local company in Indonesia?
Indonesia’s Positive Investment List determines which business fields are allowed to be penetrated by foreign investors. An alternative for foreign investors who want to operate within close off business fields is establishing a local company.
Local companies in Indonesia are also more affordable to establish than foreign-owned companies. Start-up capital for a local company starts from IDR 50,000,000, and the amount of capital legally defines the company's size. The size of a company determines whether a company is eligible to sponsor a work permit for a foreign worker and how many they may apply for.
How do I start a local company in Indonesia?
To establish a local company in Indonesia, you will need to start by providing two shareholders, one local director, and one commissioner.
As the name implies, a local company is created for local ownership—foreign investors who want to establish a local company in Indonesia can form a special purpose vehicle company or purchase a shelf company.
Set Up Your Company NowFrequently Asked Questions
Can I set up a company in Indonesia as a foreigner?
Foreigners are able to expand their business to Indonesia in the form of a foreign-owned company (PT PMA). There are strict regulations in Indonesia for the specific business lines foreigners are able to tap into. Please refer to the Indonesian Positive Investment List. You can also set up a representative office with limited capabilities in comparison.
Can a foreigner become a director or commissioner of an Indonesian company?
If you set up a local company in Indonesia (PT PMDN), a foreigner cannot be a commissioner but can be a director if there is also a local director. As for a foreign-owned company (PT PMA), a foreigner can become a director or a commissioner.