For the past decade, Indonesia has become one of the most popular investment destinations. In terms of foreign-owned businesses, Bali is especially under the spotlight of potential shareholders.
PT PMA is the main license regulating foreign investors activities. It is suitable for projects of any size and investors do not face any limits in their inceptions. Setting up requires a closer look at the Indonesia-based ownership regulations due to the range of limitations.
Any organization that is invested by foreign contributors (even in case of 1% of foreign-owned share) is considered foreign-owned one. Indonesian regulations allow foreign direct investments according to the PT PMA license.
Indonesian legislation regulates the maximum allowed foreign ownership. According to the business classification, the percentage of closed and open investments together with asset allocation varies:
- some businesses are allowed 100% of open investments both for national and foreign investors;
- another group of overseas projects are allowed closed contributions only;
- some business categories require specified percentage rates (for example, 10 % of open investments and 90% of closed ones).
You could check the list of restricted business projects in the Indonesian DNI (Negative Investment List) in order to get data about limitations to the business classification you have chosen. There are numerous international companies on the territory of Indonesia that did not use the attraction of the local investments.