Incorporating a PT PMA in Indonesia requires the company to do a little research. There are preparations to be made to meet the requirements. In the past years, the regulations are bendable and documents can be submitted at a later date. However, the change in government regulations has also changed. To create a safe business environment, the rules and consequences are exercised strictly.

What is a PT PMA?

It is important to understand PT PMA before digging deeper into the steps of incorporating a company. PT PMA is more familiarly known as foreign direct investment or foreign company. Companies that consist of a single or multiple foreign shareholders must register as a foreign company. Foreign companies must pay income taxes at a flat rate of 10%. 

To establish their presence in Indonesia various requirements need to be met. The function of these requirements is to make sure that the business is a legal entity with a genuine interest in doing business. That is why the government requires personal identification documents of shareholders and directors. Foreign companies also need to deposit a minimum amount of $1,000,000 in the local bank account. 

Another requirement is to select the industrial code. Certain industries prevent PT PMA to have full ownership over the company. If this is the case, foreign companies must either find an individual or corporate local partner. Foreign companies must be very careful in selecting the legal service provider that aids them in establishing the company. 

Frequent Troubles when Incorporating a PT PMA

 When incorporating a PT PMA, it is quite common for entrepreneurs to find troubles. Some of the common troubles are:

– Not Enough Capital

 As mentioned before, the minimum required capital that needs to be deposited is $,1000,000. Some entrepreneurs find it a challenge and thus is unable to fulfil the requirement. Without the minimum required capital, the company will not be able to get its legal documents. In that case, it is best to consult with professional service providers like MESO. They might be able to provide a solution or advice.

– Organizational Structure 

 Another frequent trouble is organizational structure. It is quite common for foreign entrepreneurs to come unprepared. They are not yet aware of the company shareholder and director roster, the exact industry and business, or the local regulations. Before establishing a company, it is highly advisable to prepare this information. Once it is ready, consult with a trustable service provider to establish the company. 

– Indecisiveness

 This is another common trouble with incorporating a PT PMA. The lack of information regarding company establishment causes investors to be indecisive. As mentioned before, it is important to come prepared. Entrepreneurs must know which industry is the targeted industry. Understand that the law is no longer bendable and there are real consequences. To reduce indecisiveness, it is best to engage in a legal consultant service. The consultants can give information on the regulations which makes it easier for investors to make decisions. 

Incorporating a PT PMA

Once all the preparations are set, foreign companies can continue with incorporating a PT PMA. At MESO, the consultants will ask the entrepreneur to submit identification documents and the organizational structure. All of these documents are necessary for the company decree. Then, the foreign investors will have to choose the business codes.

After the business codes, they also need to apply for the necessary permits. For instance, if the director is of foreign national then a work permit is necessary. Next, the company must rent an office so that they could register it as their working place. Renting a serviced office or private suite is a great option as they are both efficient and affordable. 


More reads: How to Set Up a Private Office


 Once the company already rents an office suite, the next step is to open a bank account. Then they must transfer the $1,000,000 to said bank account as proof of capital. The bank must produce this proof of capital. An unofficial proof will be at risk of rejection. Finally, after submitting the proof of capital, the company will be able to get its legal corporate documents. 

For companies looking to incorporating a PT PMA in Indonesia, MESO can be their solution. MESO offers an all in one solution starting from legal services to providing private office and virtual office service. Contact us through our website or send us an e-mail. Feel free to reach out to MESO at our Whatsapp number +62812-1315-4189.