Can a Foreigner Own 100% of a Business in Indonesia?
Published 23 September 2026 · 9 minute read · The Indonesian Lawyer
Yes, a foreigner can own 100% of a business in Indonesia in most sectors, through a PT PMA (foreign-owned limited liability company). Full ownership is the default position under the Positive Investment List, unless the specific business line (identified by its five-digit KBLI code) is closed, capped at a maximum foreign shareholding, or reserved for cooperatives and small businesses. The check has to be done at the KBLI code level, not the industry level in general, because two businesses that sound similar can sit in different categories with different ownership rules.
Table of Contents
- PT PMA vs a local nominee: why one is legal and the other is not
- The Positive Investment List and how KBLI codes decide ownership
- Sectors that are closed, capped or fully open
- Capital requirements for a wholly foreign-owned PT PMA
- Setting up 100% foreign ownership, step by step
- The mistake that costs foreign owners the most
- FAQ
PT PMA vs a local nominee: why one is legal and the other is not
A PT PMA is a limited liability company that Indonesian law recognises as foreign-owned. It can hold shares up to 100% in your name or your foreign company's name, sign contracts, employ staff, sponsor KITAS visas and hold a long-term land lease (Hak Guna Bangunan is available to it, unlike to an individual foreigner). This is the only legal route to real ownership.
What is not legal is using an Indonesian friend, spouse or staff member as a nominee to hold shares in a PT local (the domestic company structure meant for Indonesian citizens) while you run the business behind them. Nominee arrangements are unenforceable in Indonesian courts and the Investment Law carries penalties for both parties. We still see this offered informally in Jakarta and elsewhere, usually to save on the paid-up capital requirement, and we still see it collapse: the nominee sells the shares, dies, gets divorced, or simply changes their mind, and the foreign investor has no paper trail to fall back on. If you want to structure ownership through PT PMA company registration in Indonesia, the shareholding is yours on the deed from day one.
The Positive Investment List and how KBLI codes decide ownership
Since 2021, Indonesia replaced the old Negative Investment List (DNI) with a Positive Investment List issued under Presidential Regulation 10/2021, later amended by PR 49/2021. The logic flipped: instead of listing what is closed and assuming everything else is open with conditions, the current list states which business lines carry restrictions, and everything not listed is open to 100% foreign ownership by default.
Every business activity in Indonesia is classified under a KBLI (Klasifikasi Baku Lapangan Usaha Indonesia) code, a five-digit number tied to a specific description. A general trading company, a restaurant, a software developer and a construction contractor each sit under different codes, and each code is checked separately against the Positive List through the OSS (Online Single Submission) system when you apply for your NIB (Business Identification Number). This is why the honest answer to "can a foreigner own 100%" is always "it depends what your KBLI code says," not a blanket yes or no.
Sectors that are closed, capped or fully open
Most service, trading, manufacturing, technology, consulting and hospitality businesses are open to 100% foreign ownership. A handful of sectors remain closed outright, and a further group is open only up to a stated percentage, usually requiring an Indonesian partner for the remainder.
| Category | Foreign ownership | Typical examples |
|---|---|---|
| Fully open | Up to 100% | Most trading, IT services, consulting, F&B, manufacturing, e-commerce |
| Capped, partnership required | Commonly 49% to 67%, varies by code | Certain construction services, some transport and logistics activities, select media |
| Reserved for cooperatives and MSMEs | 0% | Micro and small-scale retail, some traditional food production |
| Closed to all investment | 0% | Narcotics cultivation, gambling, certain fisheries and specific defense-related items |
These percentages and category boundaries are revised from time to time, so the correct step is always to confirm the current status of your exact KBLI code before you commit to a structure, not to rely on what a friend's business was allowed to do two years ago.
Capital requirements for a wholly foreign-owned PT PMA
A PT PMA is generally required to show planned investment of more than IDR 10 billion per business line, per project location, excluding land and buildings, and to place paid-up capital of at least IDR 10 billion in the company's bank account. Figures are commonly discussed in USD equivalents by practitioners, but the regulation is denominated in IDR, and the exact threshold should be confirmed at the time of incorporation since it can move with regulatory updates.
This capital requirement is per KBLI business line. A company registering two unrelated business activities, for example a restaurant and a separate consulting service, may need to demonstrate the threshold for each line unless they fall under a permitted combined classification. This detail is one of the most common reasons a PT PMA budget ends up larger than a first-time investor expected, and it is worth working through with a lawyer before you sign a lease or hire staff.
Setting up 100% foreign ownership, step by step
The process runs in roughly the same order everywhere in Indonesia, whether your company will operate from Jakarta, Surabaya, Medan or a smaller city. Jakarta is used below because it is where most head offices and the relevant ministries sit, but the sequence and paperwork are national.
- Confirm the KBLI code and ownership cap. Done before anything else, since it determines whether 100% is even possible for your business line.
- Reserve the company name through the Ministry of Law and Human Rights (Kemenkumham) system, and draft the Articles of Association with a notary.
- Sign the Deed of Establishment in front of an Indonesian notary. This can be done in person in Jakarta or, in many cases, by power of attorney if shareholders are abroad.
- Obtain Kemenkumham approval of the legal entity, which formally creates the PT PMA.
- Register the NIB and NPWP through OSS: the Business Identification Number and Tax Identification Number, which together function as the company's operating licence for most sectors.
- Open the corporate bank account and deposit paid-up capital. Indonesian banks generally require the company's legal documents and directors to be in place first, and in-person verification is standard.
- Apply for sector-specific licences where the business line requires them, such as tourism operating licences, food and beverage permits, or construction certifications.
Realistic timing from name reservation to a working NIB is 4 to 8 weeks for a straightforward business line, longer if the sector needs additional technical licences or if document verification in your home country takes time. Anyone quoting a guaranteed timeline shorter than that for a fully compliant setup is usually skipping a step. For a full breakdown of documents and typical costs, see how to set up a PT PMA in Indonesia.
The costliest mistake: incorporating under a KBLI code that does not match what the business actually does, to avoid a capital threshold or ownership cap on the correct code. Tax and licensing authorities check activity against the registered code during audits and license renewals. A mismatch can mean a forced re-registration, back taxes, or a business operating without a valid licence for the activity it is actually running, which is a far more expensive fix than doing the classification correctly at the start.
FAQ
Can a foreigner own 100% of a company in Indonesia without an Indonesian partner?
Yes, in any business line classified as fully open on the current Positive Investment List. The company is set up as a PT PMA with the foreign individual or foreign company as sole shareholder. A local partner is only required for the smaller group of business lines that carry a specific foreign ownership cap.
What is the difference between a PT PMA and a PT local company?
A PT PMA is legally structured to accept foreign shareholders and can be up to 100% foreign owned depending on the business line. A PT local is meant for Indonesian citizens and cannot legally hold foreign shares; using an Indonesian nominee to hold shares in a PT local on a foreigner's behalf is not enforceable in Indonesian courts.
How much money do I need to set up a fully foreign-owned business in Indonesia?
A PT PMA generally needs to demonstrate planned investment above IDR 10 billion per business line, with paid-up capital of at least IDR 10 billion placed in the company's Indonesian bank account. This applies per KBLI code, so a company with multiple unrelated activities may need to meet the threshold more than once. Confirm the current figure before incorporating, since thresholds are periodically revised.
What is the Positive Investment List and has it replaced the Negative Investment List?
Yes. Presidential Regulation 10/2021, amended by PR 49/2021, replaced the old Negative Investment List (DNI) with a Positive Investment List. Under the current system, a business line is open to 100% foreign ownership by default unless it appears on the list as closed, capped, or reserved for cooperatives and small businesses.
Which business sectors are closed to foreign ownership in Indonesia?
A small number of sectors remain closed to all foreign investment, including narcotics cultivation, gambling operations, and certain defense-related and fisheries activities. A wider group is capped at a set foreign ownership percentage, commonly requiring an Indonesian partner, and applies mainly to specific construction, transport and media activities. The exact list is checked at KBLI code level, not by industry name.
How long does it take to register a 100% foreign-owned PT PMA?
A straightforward business line typically takes 4 to 8 weeks from name reservation to a working NIB (Business Identification Number), assuming documents are complete and shareholders respond promptly to notary and bank requests. Sectors needing additional technical licences, or shareholders based overseas with slower document legalisation, commonly take longer.
If you want to check whether your specific business line qualifies for 100% foreign ownership, our team can review your KBLI code and structure before you spend money on premises or staff. Send the details on WhatsApp at +62 877-9626-0478 or through our contact page. The first consultation is free, and you can also see our full range of legal and corporate services before you decide how to proceed.