Yes, a PT PMA (Foreign Investment Limited Liability Company) holds official recognition as a legal entity under Indonesian law. Although it involves foreign ownership, the company is established under Indonesian law, domiciled in Indonesia, and approved through the Ministry of Law and Human Rights.
This makes PT PMA the official and only structure through which foreign investors can operate a permanent business in Indonesia.
Also read: What Is Considered a Foreign Company in Indonesia?
Legal Foundations of PT PMA
The foundation of PT PMA lies in Law No. 25 of 2007 on Investment, which requires all foreign investments to be made through a limited liability company under Indonesian law. This ensures that while ownership may be foreign, the entity itself is Indonesian in legal status.
In addition, the Limited Liability Company Law (Law No. 40/2007) and the Job Creation Law provide a comprehensive legal framework. After its registration and ratification, the company attains full legal status as an Indonesian entity.
Key Characteristics of PT PMA
PT PMA status comes with several defining features:
- Separate Legal Personality: It exists independently of its shareholders, ensuring limited liability.
- Indonesian Domicile: Every PT PMA must be based in Indonesia, solidifying its legal status.
- Commercial Rights: It enjoys the same rights and responsibilities as local companies, from signing contracts to joining tenders.
Distinction from Representative Offices
Unlike PT PMA, representative offices are not considered Indonesian legal entities. They cannot engage in full commercial activities or enter contracts on their own. PT PMA, on the other hand, can own assets, hire staff, pay taxes, and conduct business under Indonesian law.
Also read: Representative Office vs. PT PMA in Indonesia: Key Differences for Foreign Investors
Compliance and Recognition
Once the Ministry of Law and Human Rights issues its decree, the PT PMA is fully recognized as an Indonesian legal entity. From there, compliance requirements include obtaining a tax number (NPWP), registering for business licenses, and following employment and tax regulations.
Also read: Does a PMA Company in Indonesia Need an NPWP?
Why It Matters for Foreign Investors
For foreign investors, establishing a PT PMA is not just about legal compliance—it is the gateway to operating a real, sustainable business in Indonesia. Without PT PMA status, foreign companies cannot legally conduct full business activities.
Smooth Setup with Professional Support
Setting up a PT PMA involves multiple steps, from legal drafting to government approvals. Many investors face delays or compliance risks if they attempt the process alone.
That is where InvestinAsia’s Indonesia PMA Company Registration Service makes the difference. Our team ensures every step—from deed drafting to Ministry approval—is handled efficiently, helping investors avoid costly mistakes and focus on business growth.
You can also enjoy special package prices for PT PMA and KITAS services.
Ready to start your business and investment in Indonesia? Chat with us now for FREE consultation!
