How to Open a Business in Indonesia: A 2025 Guide for Foreign Investors

Indonesia continues to attract foreign investors with its growing economy, strategic location, and large consumer market. For those looking to expand internationally, setting up a company in Indonesia offers exciting opportunities. However, navigating the regulations can be challenging without the right guidance. This 2025 guide explains how foreign investors can legally open a business in Indonesia.

Step 1: Understand the PT PMA Structure

The first step for investors is establishing a PT PMA (Perseroan Terbatas Penanaman Modal Asing), or Foreign Investment Limited Liability Company. A PT PMA is the only legal entity that allows foreign ownership in Indonesia. With this structure, you can hold shares, run operations, and hire both local and foreign employees.

Key Requirements for PT PMA:

• At least two shareholders (can be individuals or entities).
  
• A minimum investment plan (commonly set at IDR 10 billion, subject to regulations).
  
• An appointed director and commissioner.
  
• A registered business address in Indonesia.
  

A PT PMA is essential for investors who want to fully control their business activities while complying with Indonesian law.

Step 2: Obtain Business Licenses

Once your PT PMA is established, you must secure the necessary licenses to operate legally. This includes:

• NIB (Business Identification Number) through the OSS system.
  
• Sector-specific permits depending on your industry.
  
• Tax registration for company compliance.
  

These licenses ensure your company is fully recognized by Indonesian authorities.

Step 3: Secure an Investor KITAS (E23)

As a foreign investor, you will also need a stay permit to reside in Indonesia while managing your company. The Investor KITAS (E23) is designed for shareholders and directors of PT PMA companies. Unlike a regular work visa, the Investor KITAS allows you to stay long-term without requiring a separate work permit.

Benefits of Investor KITAS:

• Valid for 1–2 years, extendable.
  
• Legal stay for investors actively managing their business.
  
• Exemption from additional work permit fees.
  

Step 4: Open a Corporate Bank Account

A corporate bank account is required for company transactions, capital deposits, and operational expenses. Most banks in Indonesia will request your company documents, NIB, and PT PMA deed of establishment before opening an account.

Step 5: Start Hiring and Operating

With your PT PMA established, licenses approved, and Investor KITAS secured, you are ready to begin operations. Many investors choose to combine local talent with international expertise to strengthen their business presence in Indonesia.

Opening a business in Indonesia as a foreign investor requires careful preparation and compliance with regulations. The PT PMA structure and Investor KITAS E23 are the two key elements that make your investment legitimate and sustainable. By following the right steps, 2025 can be the year you successfully expand into Indonesia’s dynamic market.