Not sure which company type fits your business?
- We compare PT PMA, local PT and representative office for your plan
- We check foreign ownership limits for your KBLI
- We set up the entity and handle the licences
All entity types compared
| Entity | Legal entity? | Foreign ownership | Can earn revenue? | Typical use |
|---|---|---|---|---|
| PT PMA | Yes, limited liability | Yes, up to 100% depending on KBLI | Yes | Foreign investors running a business |
| PT PMDN (local PT) | Yes, limited liability | No | Yes | Indonesian-owned businesses |
| PT Perorangan | Yes, limited liability | No (Indonesian citizens only) | Yes | Micro and small businesses with one founder |
| CV (limited partnership) | No | No | Yes | Small local businesses |
| Firma (general partnership) | No | No | Yes | Local professional partnerships |
| KPPA (foreign representative office) | No | Branch of a foreign company | No | Market research and liaison |
| KP3A (trade representative office) | No | Branch of a foreign company | No, but can promote and find buyers | Promoting a foreign company’s products |
| BUJKA (construction representative office) | No | Branch of a foreign construction company | Yes, through joint operations with local firms | Construction projects |
| Yayasan (foundation) | Yes | Restricted, with conditions | Not for profit | Social, religious and humanitarian work |
| Perkumpulan (association) | Yes or no | Restricted, with conditions | Not for profit | Member organisations |
| Koperasi (cooperative) | Yes | No | Yes, shared among members | Member-owned businesses |
PT PMA: foreign-owned company
A PT PMA (Perseroan Terbatas Penanaman Modal Asing) is a limited liability company with at least one foreign shareholder. It is the standard vehicle for foreign investors.
- Ownership: up to 100% foreign, depending on your KBLI code under the Positive Investment List (Presidential Regulation 10/2021, amended by 49/2021).
- Shareholders: at least two, individuals or companies. At least one director and one commissioner.
- Capital: under BKPM Regulation 5/2025, a total investment plan above IDR 10 billion per KBLI per location (excluding land and buildings), with at least IDR 2.5 billion issued and paid-up capital. Check the current rules before you plan.
- Benefits: can earn revenue, hire staff, sponsor KITAS for foreign employees, own assets and get industry licences.
See the full process in our guide how to set up a company in Indonesia as a foreigner. If you plan to work with an Indonesian partner, read our joint venture guide.
PT PMDN: local company
A PT PMDN (Penanaman Modal Dalam Negeri) is owned only by Indonesian citizens or Indonesian companies. Since the Job Creation Law, there is no fixed minimum capital for most local PTs; the founders agree the capital (Government Regulation 8/2021). Some sectors set their own requirements.
Foreigners can work in a local PT as directors or employees with a Work KITAS, but they can’t hold shares. If a foreigner buys shares, the company must convert to a PT PMA.
PT Perorangan: single-founder company
Introduced by the Job Creation Law, the PT Perorangan lets one Indonesian citizen set up a limited liability company for a micro or small business. It is registered by statement rather than a notarial deed. It is not available to foreigners.
CV and firma: partnerships
- CV (Commanditaire Vennootschap): a limited partnership with active partners, who have unlimited liability, and silent partners, whose liability is limited to their contribution.
- Firma: a general partnership in which all partners share unlimited liability. It is common for local professional practices.
Both are cheaper and simpler than a PT, but they are not legal entities, so the partners’ personal assets are at risk. Only Indonesians can be partners.
Representative offices: KPPA, KP3A and BUJKA
- KPPA (foreign company representative office): market research, promotion and coordination for the parent company. It cannot sign sales contracts, invoice or earn revenue. It must use the parent company’s name.
- KP3A (foreign trade representative office): promotes and markets the parent company’s goods and finds buyers or distributors, but cannot sell directly.
- BUJKA (foreign construction representative office): lets foreign construction companies take on projects in Indonesia through joint operations with local contractors.
Representative offices are a low-commitment way to test the market. To trade or invoice, you need a PT PMA.
Foundations, associations and cooperatives
Not every organisation is a company. Indonesia also recognises:
- Yayasan (foundation): a non-profit legal entity for social, religious or humanitarian purposes, established by notarial deed and approved by the Ministry of Law. It cannot distribute profits to founders.
- Perkumpulan (association): a member-based organisation. It can be a legal entity registered with the Ministry of Law, or a non-legal-entity civil society organisation registered with the Ministry of Home Affairs.
- Koperasi (cooperative): a member-owned business that shares profits among its members.
Foreign participation in foundations and associations is restricted and depends on conditions set by regulation. For more detail, see how to set up an organization in Indonesia.
How to choose the right entity
| Your goal | Best entity |
|---|---|
| Own and run a business in Indonesia as a foreigner | PT PMA |
| Partner with an Indonesian company in a capped sector | PT PMA joint venture |
| Test the market before investing | KPPA (or KP3A for trading) |
| Take on construction projects as a foreign contractor | BUJKA |
| Indonesian founders starting a business | PT PMDN, PT Perorangan or CV |
| Social, religious or humanitarian work | Yayasan or perkumpulan |
Frequently asked questions
What is the most common company type for foreigners in Indonesia?
The PT PMA, a foreign-owned limited liability company. It is the only company type that lets foreigners hold shares, earn revenue and sponsor work permits.
What is the difference between PT PMA and PT PMDN?
A PT PMA has at least one foreign shareholder and must follow foreign investment rules on ownership limits and capital. A PT PMDN (local PT) is owned only by Indonesians or Indonesian companies and has more flexible capital rules.
Can a foreigner own shares in a CV or a local PT?
No. A CV, a firma and a local PT can only be owned by Indonesians. If a foreigner becomes a shareholder, the company must convert to a PT PMA. Nominee arrangements to get around this are not recognised by law.
What is a PT Perorangan?
A single-founder company for micro and small businesses, introduced by the Job Creation Law. It is only available to Indonesian citizens.
Can a representative office make sales?
No. A KPPA can do market research, promotion and liaison for its parent company. It cannot sign sales contracts, invoice customers or earn revenue in Indonesia.
Can foreigners set up a foundation or association?
Foreigners can be involved in a foundation (yayasan) or association (perkumpulan) only under specific conditions, often together with Indonesian founders. These are non-profit entities and can’t distribute profits. Check the current requirements for your case.
Last reviewed: October 2026. Company rules, capital requirements and foreign ownership limits change. Confirm current requirements with BKPM, OSS or our team before you decide.
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Tell us what you plan to do in Indonesia. We’ll recommend the entity, check ownership limits and give you a written quote before you pay.