Starting a Restaurant in Indonesia: Structure, Permits, Costs
Published 23 September 2026. Reading time: 9 minutes. The Indonesian Lawyer.
Starting a restaurant in Indonesia as a foreign investor requires a PT PMA company with a foreign investment classification for food and beverage service, a business identification number (NIB) issued through the OSS system, a halal certificate unless the menu is explicitly exempt, a hygiene and sanitation certificate from the local health office, and a building or fit-out approval before opening. Foreigners cannot legally run a restaurant on tourist visas or through nominee arrangements. Paid-up capital for a PT PMA in this sector generally starts at IDR 10 billion, excluding land and buildings, though this depends on the risk classification assigned to your specific KBLI code.
Table of Contents
- Which business structure to use
- The permits you actually need, in order
- Capital requirements and what counts
- A worked example: opening in Yogyakarta
- Hiring staff and foreign chefs
- Common mistakes that stall a launch
- FAQ
Which business structure to use
If you are Indonesian, a local PT can own and run a restaurant with no foreign ownership limit. If you are a foreign national, even a foreign national married to an Indonesian, the vehicle you need is a PT PMA registered under a food and beverage service KBLI code, most commonly 56101 for restaurants. There is no legal path in which a foreigner owns a restaurant through an Indonesian friend's or partner's ID card and keeps clean title to the business. That is a nominee arrangement, it is not recognised by Indonesian company law, and the nominee holds the shares, not you. We see disputes from this arrangement regularly, usually when the relationship between the parties sours or the nominee dies and the shares pass to their heirs.
A PT PMA gives you a foreign-owned limited liability company that can hold the business licence, lease premises, sponsor work permits for foreign staff, and open a company bank account in its own name. Setup takes roughly four to eight weeks from signed deed to a fully licensed, tax-registered entity, depending on how quickly you can supply notarised documents and how busy the OSS system is that month.
The permits you actually need, in order
Restaurants in Indonesia are not licensed with a single document. You need a stack of them, obtained roughly in this order, and skipping ahead usually just means redoing work later.
| Permit or licence | Issued by | Purpose |
|---|---|---|
| NIB (Nomor Induk Berusaha) | OSS system, national | Base business identification number, required before any other licence |
| Standard certificate / risk-based licence | OSS, based on KBLI risk level | Confirms you may legally operate the specific food service activity |
| Halal certificate | BPJPH | Mandatory for food and beverage products unless explicitly declared non-halal on the label or menu |
| Hygiene and sanitation certificate | Local health office (Dinas Kesehatan) | Confirms kitchen, storage and service areas meet food safety standards |
| PBG (building approval) | Local government (PUPR) | Required if you build, extend or significantly renovate the premises |
| SLF (certificate of building function worthiness) | Local government | Confirms the finished building is safe to occupy for its intended commercial use |
| Alcohol trading licence (SIUP MB) | Provincial or municipal trade office | Only if you plan to serve or sell alcoholic beverages |
| NPWP (tax ID) | Directorate General of Taxes | Required for corporate tax, VAT and payroll withholding |
The halal certificate causes the most confusion. It applies to the product, not the restaurant's identity, and it is mandatory under national law for food and beverage businesses unless you explicitly label the product as not halal. Many small foreign-run cafes assume it only matters if they want to attract a specific customer base. It does not work that way. Enforcement varies by region and by how visible the business is, but the obligation exists regardless.
Capital requirements and what counts
A PT PMA in the food and beverage sector needs a total investment plan above IDR 10 billion per business line, per location, excluding land and buildings. Of that, at least IDR 10 billion typically needs to be shown as paid-up capital, split among the shareholders according to their shareholding percentage. This figure is a planning threshold used at registration, not cash that has to sit untouched in a vault. It can be spent on kitchen equipment, fit-out, initial stock, deposits and working capital once the company exists, as long as the spending is documented and consistent with the investment plan filed in OSS.
This threshold is set at the KBLI and national investment policy level, so it applies the same way whether you are opening in Jakarta, Surabaya, Medan or a smaller regional city. It does not scale down for a modest 40-seat restaurant versus a large multi-outlet operation. Some investors handle this by structuring one PT PMA to hold several outlets under the same business line, which spreads the capital commitment across more revenue rather than requiring a fresh IDR 10 billion for every new branch, though each additional location still needs its own local operating permits.
A worked example: opening in Yogyakarta
Yogyakarta is a useful example because it has the mix most foreign investors deal with elsewhere in Indonesia too: a real local government process, a mix of heritage and modern zoning, and strong demand from students, tourists and a growing expat community around areas like Sleman and the streets near Malioboro and Prawirotaman. A restaurant near Prawirotaman aimed at tourists will go through the same national licensing stack described above, but the local government adds its own layer: heritage zoning restrictions apply close to the kraton area, and building approvals in parts of the city centre involve additional review because of cultural heritage rules that do not exist in, say, a newer commercial strip in Sleman.
Typical timeline for a straightforward fit-out in an existing commercial unit in Yogyakarta, rather than new construction, runs about six to ten weeks from signed lease to opening day: two to three weeks for the PT PMA and NIB, two to three weeks for the hygiene certificate and standard licence, and the remainder for halal certification and final inspections, run partly in parallel. New construction adds the PBG and SLF process, which can add two to four months depending on the scope of the build and how quickly the local PUPR office processes the file. These figures vary city to city and should be confirmed locally before you sign a lease with a fixed opening date attached.
Hiring staff and foreign chefs
Indonesian staff need standard employment contracts, must be registered with BPJS Kesehatan and BPJS Ketenagakerjaan, and must be paid at least the regional minimum wage, which is set annually and differs significantly between provinces and even between cities within the same province. A cook or server in Yogyakarta is paid under a different minimum wage figure than the same role in Jakarta or Surabaya, so budget locally rather than using a national average.
If you want to bring in a foreign head chef or a foreign general manager, that person needs a KITAS tied to a work permit sponsored by the PT PMA, not a tourist or social visa. The role has to be one that is open to foreign workers under the current negative investment list rules for that KBLI code, and the company has to show a plan to eventually transfer skills to an Indonesian counterpart in most cases. Running a kitchen with an undocumented foreign chef on a tourist visa is a common shortcut that immigration enforcement has been targeting more actively in recent years, and it puts both the individual and the PT PMA's licence at risk.
Common mistakes that stall a launch
The single most expensive mistake is signing a commercial lease before confirming the zoning and building status of the property. A landlord telling you "many restaurants operate here" is not the same as the location holding a valid PBG and SLF for food and beverage use. If the building was never approved for commercial food service, you may be unable to get the standard licence or the hygiene certificate no matter how good your paperwork otherwise is, and by then you have already paid a year's rent in advance, which is standard practice in Indonesia.
Before signing any lease, get the building's PBG and SLF status checked against the specific commercial use you intend, in writing, from the local government office, not just from the landlord's word. A due diligence check before signing costs a fraction of a lease deposit lost to a location that was never legally approved for a restaurant.
Other recurring problems: assuming the NIB alone is enough to open, when in fact it only starts the process for risk-based licensing; underestimating how long halal certification takes when the supply chain includes imported ingredients that need their own certification trail; and treating the KBLI code chosen at registration as a formality, when it actually determines your capital threshold, your risk classification, and which permits apply to you at all.
FAQ
Can a foreigner own 100% of a restaurant in Indonesia?
Yes, through a PT PMA registered under the correct food and beverage KBLI code, foreign ownership of up to 100% is generally permitted for restaurants, subject to the sector's current investment list status and the standard capital requirements. Foreigners cannot legally own a restaurant through a local PT using a nominee, since that structure has no protection under Indonesian company law.
How much capital do I need to open a restaurant in Indonesia?
A PT PMA in the food and beverage sector generally needs a total investment plan above IDR 10 billion per business line and location, excluding land and buildings, with a similar figure typically required as paid-up capital. This is a national threshold tied to the KBLI classification, so it applies broadly across Indonesia rather than varying by city, though the actual figure should be confirmed for your specific business plan.
Is halal certification mandatory for restaurants in Indonesia?
Yes, halal certification is mandatory under national law for food and beverage products sold in Indonesia, unless the product is explicitly labelled as not halal. It applies regardless of the restaurant owner's nationality or the target customer base. Enforcement intensity varies by region, but the legal obligation itself does not.
How long does it take to get all the permits to open a restaurant?
For a fit-out in an existing commercial space, expect roughly six to ten weeks from a signed lease to full licensing, covering company formation, the NIB, the hygiene certificate and halal certification. New construction adds a PBG and SLF process that can extend the timeline by two to four months, depending on the local government's processing speed and the scope of the build.
Do I need a separate licence to serve alcohol?
Yes. Serving or selling alcoholic beverages requires a separate alcohol trading licence, generally called SIUP MB, issued by the provincial or municipal trade office in addition to the standard food and beverage licensing. Requirements and restrictions on where alcohol can be served vary by region, so this should be confirmed with the local trade office before finalising a menu or a lease.
Can I hire a foreign chef for my restaurant in Indonesia?
Yes, but the chef needs a KITAS tied to a work permit sponsored by the PT PMA operating the restaurant, not a tourist or social visa. The position must be one open to foreign workers for that business classification, and the company generally needs to show a plan for eventual skills transfer to an Indonesian employee. Working without proper sponsorship risks both the individual's status and the company's business licence.
If you are planning to open a restaurant anywhere in Indonesia, from Jakarta to Yogyakarta to smaller regional cities, the details above change based on your specific location and KBLI code, and it is worth checking them before you sign anything. Send your question to The Indonesian Lawyer on WhatsApp at +62 877-9626-0478 or through our contact page. The first consultation is free.
For related reading, see our guides on PT PMA company registration in Indonesia, how to set up a PT PMA in Indonesia, and work permits and residence visas in Indonesia for staffing your new business.