The establishment of a Foreign Investment Limited Liability Company (PT PMA) is a strategic step for those of you who want to expand your business in Indonesia. With its huge market potential, Indonesia attracts many foreign investors. However, the process of establishing a PT PMA has several stages and requirements that you must know. Understanding these stages will help you navigate the process more easily and efficiently.

Before you start, it is important for you to understand the regulations in Indonesia related to PT PMA. That way, you will be able to fulfil all the requirements needed. In this article, we will discuss the stages and requirements that you need to know in establishing a PT PMA. Let's start by understanding the stages of establishing a PT PMA.

Stages of PT PMA Establishment
The process of establishing a PT PMA consists of several stages that you must go through. Each stage has different requirements and procedures, so it is important to understand each step well. The following are the main stages in establishing a PT PMA in Indonesia.

1. Initial Licensing
The first stage in establishing a PT PMA is obtaining the initial licence. You need to apply for a principle licence from the Investment Coordinating Board (BKPM).

The principle licence is the initial approval to conduct business activities in Indonesia. In this process, you'll need to prepare the necessary documents, such as a business proposal and information about the company structure.

After obtaining an in-principle licence, you can proceed to the next stage. Usually, an in-principle licence is valid for one year, and you'll need to ensure all requirements are met within that period. With your principle licence in place, you can start planning the next steps in setting up your PT PMA.

2. Formation of Deed of Establishment
After obtaining the principle permit, the next step is to create a company deed of establishment. The deed of establishment must be drafted by a notary public and contain information about the company name, address, business purpose, and shareholding structure. You need to liaise with the notary to ensure all the required information is correctly listed in the deed of establishment.

This deed of establishment must then be authorised by the Ministry of Law and Human Rights. The estimated legalisation process usually takes a few days to a week. Once the deed of establishment is legalised, you can proceed to the next stage in the PT PMA establishment process.

3. NPWP and NIB Registration
The next step is to register the Taxpayer Identification Number (NPWP) and Business Identification Number (NIB). The NPWP is required for corporate tax purposes, while the NIB serves as a corporate identity used for various administrative purposes. You can register NPWP and NIB through the Online Single Submission (OSS) system.

The NPWP and NIB registration process is usually quite quick and can be completed within a few days. Once you obtain the NPWP and NIB, your company will have the official identity required to run business operations in Indonesia. This step is crucial to ensure your company operates legally.

4. Business Licence Processing
After obtaining the NPWP and NIB, the next step is to apply for a business licence. A business permit is required so that you can carry out business activities in accordance with the specified field. Business permits can vary depending on the type of business you run, so make sure you understand the business permits required for your business.

The process of applying for a business licence can be done through OSS or directly to the relevant agencies. You need to prepare the supporting documents required to apply for a business licence. Once the business licence is obtained, you can start running your business operations fully.

5. Location Permit
In addition to a business licence, you also need to apply for a location permit. This location permit ensures that your business premises fulfils all applicable requirements and regulations. The location permit process may involve several government agencies depending on the location and type of your business.

You need to prepare documents such as the location plan, land certificate, and permission from the local government. The estimated time to complete the location permit process can take several weeks to months depending on the complexity of the permit required. Make sure all documents are prepared completely to expedite this process.

6. Submission of Investment Activity Report
Once all permits have been obtained, the final step is to submit the investment activity report to BKPM. This report contains information on the realisation of investments made by your company. This report must be submitted periodically in accordance with applicable regulations.

By submitting the report, you will ensure that your company complies with all applicable regulations. In addition, the report is also important to monitor the progress of your investment in Indonesia. Once the report is submitted, your PT PMA establishment process is complete and you can start focusing on business development.

Terms of Establishment of PT PMA

In addition to the stages that must be passed, the establishment of a PT PMA also requires several requirements that must be met. These requirements include administrative requirements, capital requirements, and other requirements applicable in Indonesia. Fulfilling all these requirements will help you in the process of establishing a PT PMA more smoothly.

1. Administrative Requirements
Administrative requirements include the documents that must be prepared to apply for the PT PMA licence and establishment process. These documents include the deed of establishment, principle licence, NPWP, NIB, and other supporting documents. Make sure all documents are prepared completely and according to the applicable provisions.

In addition, you will also need to take care of the various permits and licences required according to the type of business you will be running. Administrative requirements are essential to ensure your company operates legally and fulfils all applicable regulations in Indonesia.

2. Capital Requirements
Establishing a PT PMA also requires capital requirements to be met. This capital can vary depending on the type of business you are running and the applicable regulations in Indonesia. Make sure you have enough capital to run your business operations.

The capital can be in the form of paid-up capital or issued capital, and must be stated in the company's deed of establishment. Meeting the capital requirements will help you in obtaining the necessary permits and licences to run your business in Indonesia.

3. Shareholding Requirements
In addition to the capital requirements, you also need to fulfil the share ownership requirements in the establishment of a PT PMA. The shareholding must be in accordance with the prevailing regulations in Indonesia, and can involve both foreign and local shareholders.

Make sure your shareholding structure is clearly stated in the company deed of establishment. Meeting these shareholding requirements is important to ensure your company operates legally and in accordance with applicable regulations.

4. Location Requirements
Business location is also one of the requirements that must be fulfilled in establishing a PT PMA. You need to ensure your business location fulfils all applicable requirements and regulations. This includes obtaining a location permit and ensuring your business location is in accordance with the predetermined designation.

The process of obtaining a location permit can involve several government agencies, so make sure all documents are prepared in full. Fulfilling these location requirements is important to ensure your business operations run smoothly and in accordance with applicable regulations.

5. Investment Activity Report Requirements
One of the important requirements in establishing a PT PMA is to submit an investment activity report to BKPM. The report contains information about the realisation of investments made by your company. The report must be submitted periodically in accordance with applicable regulations.

Fulfilling this requirement is important to ensure your company complies with all applicable regulations. By fulfilling these requirements, you can run your business more smoothly and in accordance with applicable regulations.

Source: kontrakhukum.com