INDONESIA · BUSINESS · COMPANY FORMATION
Starting a Company in Indonesia: PT PMA, and Why the Nominee Route Is a Trap
Indonesia
Indonesia's foreign investment framework has opened up substantially — full foreign ownership is now the default position across most sectors through the correct legal structure. The nominee shortcut you may have heard about is not a grey area or a common workaround. It is explicitly illegal, and the foreign party carries essentially all the risk.
The short answer
A PT PMA — a foreign-owned limited liability company — is Indonesia's legally recognised structure for foreign business ownership, and Indonesia's Positive Investment List now treats 100% foreign ownership as the default across most sectors, restricted only where specifically stated by activity code (KBLI). Using an Indonesian nominee to hold shares on a foreigner's behalf, in order to bypass ownership rules, is explicitly prohibited under Law No. 25 of 2007 on Investment, Article 10(1). This is not a soft or contested rule: courts have invalidated shares held under nominee arrangements, and the foreign party in a disputed nominee structure has essentially no legal protection if the nominee acts against them.
Is this you?
See which of these is closest to your situation.
- You want to start or buy into a business in Indonesia and someone has suggested an Indonesian nominee could hold shares for you.
- You're not sure whether your specific business activity is open to full foreign ownership.
- You're already in a nominee arrangement and are starting to worry about your actual legal position.
- You want to register a PT PMA and don't know what the process or capital requirements actually involve.
- Someone offering to set this up for you seems very keen on the nominee route specifically.
Whichever applies, the structure decision at the start is the one that determines whether you actually own what you think you own.
What happens next
We confirm your activity's ownership status via its KBLI code
Ownership permissions under Indonesia's Positive Investment List are set at the specific business-activity code level, not by broad industry category — two businesses that sound similar can have different foreign-ownership limits. We confirm the correct classification for what you're actually doing, rather than assume the general openness applies without checking.
We explain, plainly, why the nominee route is not a workaround
Nominee shareholding to bypass foreign-ownership rules is explicitly prohibited under Indonesia's Investment Law. If someone proposes this to you as routine, that itself is worth treating with caution — legitimate advisers structure around the actual rules, not around disguising who really owns the business.
We set up the PT PMA correctly
Registration runs through Indonesia's Online Single Submission (OSS) system, tied to the Ministry of Investment/BKPM. We coordinate the documentation, capital arrangements, and licensing so the company is correctly formed from the outset, not corrected after a problem surfaces.
If you're already in a nominee structure, we assess your actual position
This is a genuinely urgent conversation, not a routine one. Courts have invalidated nominee share arrangements, and the earlier you understand your real legal exposure and the options for regularising it, the more choices you generally have.
We set you up for ongoing compliance
Company registration is the beginning — licensing tied to your specific KBLI activity, tax registration, and reporting obligations continue afterward. We make sure you know what's required to keep the business in good standing, not just to open it.
This describes Indonesia's framework specifically. Foreign-ownership structures, capital requirements and the legal status of nominee arrangements differ substantially between Indonesia, Thailand and Cambodia — do not assume what applies here applies elsewhere.
What this costs — ours and Indonesia's, separated
Two different pockets of money, kept separate. Government registration and licensing costs are paid to Indonesian authorities; our fee is ours, quoted in writing before we start.
| Connect Consult | Official / government charge | |
|---|---|---|
| PT PMA registration via OSS | Coordinated as part of our service — quoted upfront | Set by the OSS system / Ministry of Investment — varies by activity and structure |
| Minimum paid-up capital | We confirm the current figure for your specific structure before you commit funds | Not stated here — verify current requirement directly, see cost note above |
| Indonesian corporate/investment counselYou always see the local firm's fee as its own line before you instruct them — never folded into ours. | Quoted per matter, in writing, before you instruct | Not a government fee — set by the instructed firm |
| Connect Consult coordination fee | IDR 490 – 1,100* — published, fixed, the same for everyone | — |
* Indicative price range only. This service is a tailored solution, assembled after consulting a specialist and budgeted against your case's specific requirements, third-party costs, your goals and your personal circumstances. Figures are guidance, checked against official sources and dated on this page. Official amounts are set by the authority and can change without notice — before you commit to anything, we confirm the exact figures for your case in writing. We do not mark up official charges or counsel fees.
Doing it yourself vs doing it with us
A straightforward PT PMA in an open sector genuinely doesn't need a broker layered on top. Here's the honest line.
| On your own | With Connect Consult | |
|---|---|---|
| Clear, open-sector activity, straightforward structure | Workable directly with an Indonesian corporate lawyer | We'll tell you that plainly rather than suggest otherwise |
| Ownership status of your specific activity is unclear | Easy to assume general openness without checking your exact KBLI code | We confirm your specific activity's classification before you register anything |
| Someone has proposed a nominee shareholder structure | Genuinely dangerous to accept on trust — the foreign party has essentially no protection if it goes wrong | We explain plainly why it's not a lawful shortcut, and set up the correct PT PMA structure instead |
| You're already in a nominee arrangement | Very difficult to assess or unwind alone | We assess your actual legal position and the realistic options with Indonesian counsel |
The honest version
If your activity is clearly open to full foreign ownership and your structure is simple, registering a PT PMA directly with an Indonesian corporate lawyer is entirely workable. Where your activity's ownership status is unclear, or — especially — where anyone proposes a nominee structure to you, that's exactly where an independent check before you commit matters most.
Common questions
Can a foreigner own 100% of a company in Indonesia?
In most sectors, yes, through a properly structured PT PMA — Indonesia's Positive Investment List now treats full foreign ownership as the default, restricted only where specifically stated for your exact business-activity code (KBLI). We confirm your specific activity's status rather than assume the general rule applies.
Is using a nominee to hold shares for me actually illegal?
Yes. Using an Indonesian nominee to hold shares on a foreigner's behalf, to bypass foreign-ownership rules, is explicitly prohibited under Law No. 25 of 2007 on Investment, Article 10(1) — this is stated directly in the official statute, not just widely claimed. Courts have invalidated shares held this way.
What actually happens to me if a nominee arrangement goes wrong?
The foreign party generally has very limited legal recourse — the nominee retains legal ownership of the shares, and disputes over control, blocked bank access, and difficulty proving beneficial ownership are all documented real consequences. This is genuinely one of the highest-risk situations foreign investors in Indonesia can put themselves in.
Why does so much content online recommend against nominees but come from companies that sell PT PMA setup services?
It's a fair thing to notice, and worth being aware of: most of the content warning against nominee structures is published by firms that profit from selling the alternative (PT PMA incorporation). That commercial interest doesn't make the underlying legal fact wrong — nominee illegality is independently stated in the official Investment Law text, not something we're taking on the word of a company-formation marketer — but it's worth knowing who's telling you what, and why, before you rely on any single source.
How much capital do I need for a PT PMA?
We deliberately don't state a specific figure on this page — reported capital requirements have changed and we haven't directly verified the current regulation. Confirm the current minimum at oss.go.id or bkpm.go.id, or ask us to confirm it for your specific structure.
Can you guarantee my PT PMA application will be approved?
No — and be cautious of anyone who claims they can. Registration and licensing decisions rest with the relevant Indonesian authorities. What we can do is make sure your application is correctly classified and properly prepared.
Are you an Indonesian law firm?
No. Connect Consult is a legal-services concierge. Company registration and structuring advice are handled by counsel and advisers qualified in Indonesia, whom we brief and manage.
No obligation
Tell us about your business. We'll tell you the correct structure.
A short description of your business activity and any structure that's been proposed to you — we'll tell you plainly what's actually lawful, and what to walk away from.
Connect Consult is a legal-services concierge for foreigners in South East Asia. We are not an Indonesian law firm and we do not hold an Indonesian legal practising licence. Company registration, structuring advice and licensing are handled by counsel and advisers licensed to practise in Indonesia — instructed, briefed and managed by us, with their fee quoted to you before you instruct them. We never guarantee an outcome. This page cites Law No. 25 of 2007 on Investment (Article 10(1)) directly from the official BKPM legal repository for the nominee-illegality fact stated — we note openly that most secondary content on this topic is published by company-formation service providers with a commercial interest in the PT PMA alternative, and we encourage you to weigh that alongside the underlying statute rather than take any single source's word for it, including ours. The PT PMA minimum capital figure is not stated here as we have not directly verified the current regulation — confirm it independently before budgeting. Last reviewed August 2026.
Official sources
- BKPM official legal repository — Law No. 25 of 2007 on Investment (English translation) ↗Indonesia's investment law in the government's own English translation, published by BKPM's legal repository. Cited as the primary instrument. Note that the nominee-structure risk described on this page turns on how this law interacts with the Civil Code and later regulations — this link is the anchor, not the whole answer. Verified August 2026.
Where to go next
Other situations in Indonesia