A PT PMA (Perseroan Terbatas Penanaman Modal Asing) is Indonesia’s foreign-owned limited liability company structure, and it does not need Indonesian shareholders in most sectors, though it does need to prioritize hiring Indonesian workers under Investment Law No. 25 of 2007. These two rules get confused constantly, and the confusion costs foreign founders real time and money when they structure a company around the wrong assumption.
Key Takeaways
- A PT PMA does not need an Indonesian shareholder in sectors open to full foreign ownership under Presidential Regulation No. 10 of 2021. It does need to prioritize Indonesian hires under Investment Law No. 25 of 2007.
- Under BKPM Regulation No. 5 of 2025, the minimum paid-up capital dropped from IDR 10 billion to IDR 2.5 billion, but the total investment plan per KBLI code still has to exceed IDR 10 billion.
- In 2025, Indonesia’s “Operation Wira Waspada” led to hundreds of PT PMA license revocations, several tied directly to nominee-shareholder arrangements and unmet investment commitments.
Must a PT PMA Employ Indonesian Workers?
Yes. Investment Law No. 25 of 2007 requires PT PMA companies to prioritize Indonesian citizens in hiring, and this applies regardless of sector. In practice this does not mean a PT PMA can never hire foreign staff. It means Indonesian candidates come first, and foreign hires are the exception that requires justification.
To bring in a foreign professional, the company needs an approved RPTKA (Rencana Penggunaan Tenaga Kerja Asing) from the Ministry of Manpower, plus a valid KITAS work and stay permit for the individual. Since 2021, this runs as a two-step approval: a feasibility assessment (HPK RPTKA) followed by formal endorsement of the RPTKA itself. As of 2025, most of this process moved onto a digital system, with eVisa and e-ITAS replacing the older paper permits, so errors in the RPTKA filing now carry straight through to immigration and can stall a work visa before it even starts.
Alongside the RPTKA, the employer has to show a knowledge transfer plan. This is not a box-ticking formality. During RPTKA renewals, the Ministry of Manpower checks whether the transfer of skills to Indonesian staff actually happened, not just whether it was written down two years earlier.
I should flag some uncertainty here: older guidance referenced a fixed 10-to-1 ratio of Indonesian to foreign workers, and several sources still describe that ratio as abolished under the current framework. I was not able to confirm a specific, currently active numeric ratio requirement in the sources I checked, so if a strict headcount ratio matters to your hiring plan, verify the current position directly with the Ministry of Manpower or a licensed consultant rather than relying on this article alone.
Also read: PT PMA Taxation in Indonesia: A 2026 Complete Guide
No, not as a general rule. Presidential Regulation No. 10 of 2021, as amended by No. 49 of 2021, established Indonesia’s Positive Investment List (Daftar Prioritas Investasi), which flips the old approach. Instead of listing which sectors foreigners may enter, it lists the sectors that are closed or capped, and treats everything else as open to 100 percent foreign ownership.
To set up a PT PMA, you need at least two shareholders, who can both be foreign individuals, both be foreign entities, or a mix. No Indonesian shareholder is required for that minimum to be satisfied. You also need at least one director residing in Indonesia (who can be a foreign national holding the right permits) and at least one commissioner, who can be foreign and does not need to live in Indonesia.
Where a local partner does become necessary is in sectors carrying an ownership cap, commonly 49, 51, or 67 percent, such as certain domestic courier services, some retail formats, and parts of domestic sea transport. A handful of sectors, including gambling and narcotics production, remain closed to foreign capital altogether. Your specific five-digit KBLI code determines which category you fall into, and two businesses that sound similar can land in different categories depending on that classification.
What Are the 2026 Capital Requirements for a PT PMA?
This is where the biggest recent change sits, and it is one many older guides have not caught up with. Under BKPM Regulation No. 5 of 2025, effective October 2, 2025, the minimum paid-up capital for a PT PMA dropped from IDR 10 billion to IDR 2.5 billion. That is a 75 percent reduction, and it genuinely changes who can afford to set up a fully foreign-owned company in Indonesia.
What did not change is the total investment plan requirement. Every PT PMA still has to declare, per five-digit KBLI code and project location, an investment plan exceeding IDR 10 billion, excluding land and buildings. Read that as two separate numbers: IDR 2.5 billion is the cash you actually deposit into the company account at incorporation, while the IDR 10 billion figure is your committed investment plan tracked over time through quarterly LKPM reports, not a one-time deposit.
Two more details from the same regulation matter in practice. First, once the paid-up capital lands in the company’s bank account, it cannot be withdrawn for 12 months except for genuine operational or business use, a rule aimed at stopping capital from being parked and pulled straight back out. Second, LKPM reporting deadlines moved to the 15th of April, July, October, and January, a few days later than the previous cutoffs.
Also read: How to Register a PT PMA in Indonesia: The Complete 2026 Step-by-Step Registration Guide
Notes from InvestinAsia Consultants
The confusion we see most often is investors treating the IDR 2.5 billion paid-up capital as a government fee they will never see again. It is not. It is the company’s own working capital, sitting in its own bank account, usable for rent, salaries, and equipment from day one. The IDR 10 billion figure is the separate, larger commitment tracked through your LKPM filings, and mixing the two up during initial planning is one of the more common reasons a capital structure needs revising later.
The consequences are not theoretical. In January and February 2025, Indonesia’s Directorate General of Immigration ran a joint enforcement operation with BKPM, known as Operation Wira Waspada, focused initially on Bali and North Maluku. Inspectors reviewed 267 PT PMA companies whose business licenses had already been revoked for failing to meet their committed investment value, and found dozens still actively sponsoring foreign staff despite that revocation. Sanctions connected to that enforcement push, and its follow-on inspections through 2025 and into 2026, have run into the hundreds of companies.
A related and specifically dangerous shortcut is the nominee shareholder arrangement, where an Indonesian national holds shares on paper for a foreign investor who actually controls the business. This is explicitly illegal under Article 33 of Investment Law No. 25 of 2007, and Indonesian courts do not enforce the private side agreements that typically accompany it. If the nominee decides to act against the foreign investor’s interests, or simply disappears, the foreign party has no legal recourse. The company also risks dissolution and asset forfeiture if the arrangement surfaces during an audit or a licensing review.
Missing RPTKA obligations carries its own separate risk. Employing a foreign national without an approved RPTKA and matching KITAS can trigger deportation for the individual and administrative penalties for the company, independent of any shareholder issues.
Not sure if your planned ownership structure is actually compliant?
InvestinAsia’s team checks your KBLI, ownership split, and capital plan against the current rules before you file anything.
Why This Matters for Investors Planning Their Structure
The practical takeaway is that these two questions have opposite answers, and mixing them up shapes very different decisions. Getting the ownership side right early means you are not forced into a joint venture you never wanted. Getting the employment side right means you are not caught understaffing your compliance obligations or overpromising foreign headcount you have not secured permits for. Since the capital rules changed materially in October 2025, it is worth rechecking any structure you planned before that date against the current figures rather than assuming the older IDR 10 billion paid-up capital number still applies.
How InvestinAsia Can Help
Structuring a PT PMA correctly means checking your KBLI code against the Positive Investment List, sizing your capital plan to the 2025 rules, and lining up RPTKA sponsorship before you make any foreign hire, all before you sign a single document. InvestinAsia’s PT PMA Registration service handles shareholder structuring, capital compliance, and licensing as one process, so you are not piecing together separate advice from a notary, an immigration agent, and a tax consultant who are not talking to each other.
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Frequently Asked Questions
No, not in sectors open to full foreign ownership under the Positive Investment List. A PT PMA needs a minimum of two shareholders, and both can be foreign. A local partner is only required in sectors carrying a specific foreign ownership cap.
Must a PT PMA employ Indonesian workers?
Yes. Investment Law No. 25 of 2007 requires PT PMA companies to prioritize Indonesian citizens in hiring. Foreign staff can still be employed, but only with an approved RPTKA and valid work permits.
What is the minimum capital requirement for a PT PMA in 2026?
The minimum paid-up capital is IDR 2.5 billion under BKPM Regulation No. 5 of 2025, down from IDR 10 billion previously. Separately, the total investment plan per five-digit KBLI code still has to exceed IDR 10 billion, excluding land and buildings.
Can foreigners hold all director and commissioner positions in a PT PMA?
Foreigners can hold the commissioner role and can serve as directors, but at least one director generally needs to reside in Indonesia and hold the correct work permit. The commissioner does not need to reside in Indonesia.
Nominee arrangements are illegal under Article 33 of Investment Law No. 25 of 2007 and unenforceable in Indonesian courts. Indonesia’s 2025 Operation Wira Waspada enforcement action led to hundreds of related license revocations, and the foreign investor has no legal protection if the nominee acts against their interests.
Are there restricted sectors for foreign investment in Indonesia?
Yes. Some sectors carry ownership caps of 49, 51, or 67 percent, requiring a local partner for the remaining share. A small number of sectors, including gambling and narcotics production, remain fully closed to foreign investment.
References
1. Government of Indonesia. (2007). Law No. 25 of 2007 on Investment. Retrieved from
https://peraturan.go.id/id/uu-no-25-tahun-2007
2. Government of Indonesia. (2021). Presidential Regulation No. 10 of 2021 on Investment Business Fields, as amended by Presidential Regulation No. 49 of 2021. Retrieved from
https://peraturan.bpk.go.id/Details/161806/perpres-no-10-tahun-2021
3. Ministry of Investment / BKPM. (2025). Regulation No. 5 of 2025 on Guidelines and Procedures for Risk-Based Business Licensing and Investment Facilities through OSS. Retrieved from
https://bkpm.go.id
4. Directorate General of Immigration, Ministry of Law and Human Rights. (2025). Operasi Wira Waspada Perdana di Tahun 2025. Retrieved from
