Recently, the Indonesian government is working on new regulations for e-commerce platforms, aiming to protect local MSMEs from the pressure of high overheads and commissions. This initiative reveals an important trend:Indonesia's market is shifting from "wild growth" to "standardized development".The

For foreign companies planning to enter Indonesia, this policy windsock means: achieving compliance through the registration of a local entity is not only a necessary threshold for entry into mainstream e-commerce platforms (e.g., TikTok Shop, Shopee), but also a long-term strategic choice for obtaining the policy dividend and winning the trust of the market. In this article, we will systematically dismantle the whole process of company registration in Indonesia in 2026.

I. Six core advantages of registering an Indonesian company

1. Full operational autonomy: By registering a wholly foreign-owned company (PT PMA), 100% foreign ownership can be realized without the need for local shareholders to intervene, which guarantees complete autonomy from daily operations to profit distribution.
2. Grab the e-commerce traffic admission ticket: Indonesia is one of the largest e-commerce markets in Southeast Asia. Platform policies are increasingly moving towardLocal Incorporationtilt, may enjoy more advantages and stability in traffic allocation, marketing tools and payment settlements.
3. Facilitation of management team stayShareholders and directors of PT PMA are eligible to apply for the Investor's Residence Permit (KITAS), which is a simpler process than the standard work visa and facilitates the core team to be permanently based in Indonesia for management and operations.
4. Legal operation of the whole business chain: A PT PMA company can obtain a full operating license covering importation, warehousing, wholesaling, retailing and online sales in one go, eliminating the need to set up multiple legal entities for different segments.
5. Relatively friendly compliance costs: For start-ups or SMEs, annual audits are not mandatory in Indonesia (unless a specific revenue or asset size is reached), and the initial compliance burden is mainly in the form of regular tax filings.
6. Utilization of double tax treaties: China has an agreement with Indonesia for the avoidance of double taxation, which helps to rationalize tax planning and reduce the tax cost of cross-border capital transactions.

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II. Choosing the right type of company

There are various forms of business entities in Indonesia, and for foreign investors, the following three are the main ones to consider:

1. PT PMA (Wholly Foreign Owned Limited Liability Company)

• Applicable Scenarios: The vast majority of foreign-owned enterprises that conduct substantial business activities, such as cross-border e-commerce, trading, consulting, manufacturing, etc.
• Core Advantages: 100% foreign ownership is allowed, with full operating and contracting authority, can apply for an investment visa, is the mainstream choice for foreign investors to land.
• Key limitations: It needs to comply with the industry access provisions of the Negative List for Foreign Investment and has a minimum registered capital requirement.

2. PT Lokal (local limited liability company)

• Applicable Scenarios: Enterprises that are wholly owned by Indonesian citizens or local legal entities.
• Core Advantages: The registered capital requirement is very low and the establishment process is simple and quick.
• Key limitations: Foreign capital cannot be directly registered or held. If foreign investors want to enter restricted areas, they need to find reliable local partners and pay attention to the legal risks of equity shareholding.

3. Representative offices of foreign companies (KPPA)

• Applicable Scenarios: Only for non-profit activities such as market research, product promotion and customer liaison.
• Core Advantages: No paid-up registered capital is required and establishment is fast.
• Key limitations::strictly prohibitEngage in any for-profit activity, such as entering into sales contracts, issuing invoices, and collecting money directly.

reach a verdict: For foreign companies wishing to operate profitably in Indonesia.PT PMA is the only correct and mainstream choiceThe

III. Core conditions for registration of PT PMAs

Core Condition 1: Company Name and Business Scope
Prepare 2-3 alternative names starting with "PT". The scope of business must be determined to correspond to the Indonesian Industrial Classification Code (KBLI) and ensure that it does not fall within the negative list of prohibited or restricted foreign investments.

Core Condition 2: Registered Capital Requirements
The law requires that the authorized capital is normally not less than Rp 10 billion (approximately Rp 4.5 million), with an initial paid-in amount of at least 251 TP3 T. Please note that the actual amount may vary depending on the industry and the investment plan, and that some industries, or in order to satisfy the conditions of the application for an investment visa, may have higher requirements for the investment amount.

Core Condition 3: Shareholders and Structure
At least one shareholder (who may be a natural or legal person), one director and one supervisor, all of whom may be foreigners, are required. The director will act as the legal representative of the company.

Core Condition 4: Registered Address
A valid registered address in Indonesia for receiving government legal documents is required. Initially, a compliant virtual office service can be used, which has been adopted by many startups and e-commerce sellers.

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IV. Detailed explanation of the whole process of registration in 2026 (estimated 45-60 working days)

Phase I: Pre-preparation and name verification (approximately 1 week)

1. Determine the company name, business scope, registered capital and shareholding structure.
2. Company name search through the system of the Indonesian Ministry of Law and Human Rights to get approval.

Phase II: Notarization of documents and development of statutes (approximately 2-3 weeks)

1. Prepare personal documents such as identity certificates and passports of shareholders and directors.
2. If the shareholder is an overseas company, it is necessary to prepare documents such as the certificate of incorporation of the parent company, articles of association, board of directors' resolution, and to complete the certification of the Indonesian embassy or consulate abroad or the Hague certification.
3. Appointed an Indonesian licensed notary public to draft and notarize legal documents such as the Articles of Incorporation.

Phase III: Government Approval and License Application (about 3-4 weeks)

1. The notary submits the documents to the Ministry of Law and Human Rights to obtain the authorization for the incorporation of the company.
2. Through IndonesiaOSS One-Stop Online SystemSubmit an application to obtain a business registration number (NIB), which is a "single identity code" for a company that integrates basic information such as a business license and tax ID number.
3. Depending on the scope of business, apply for industry-specific business licenses in the OSS system or with the relevant ministries.

Phase IV: bank account opening and subsequent registration (approximately 1-2 weeks)

1. The director of the company is required to visit a local bank in Indonesia to open a company account in person with the full set of registration documents.
2. Contribute the first installment of paid-in capital to the account.
3. If there is a need for employment, social security registration and work permits are required for employees (including foreign employees).

V. Long-term compliance points after successful registration

Completion of registration is not the end of the road. Continuous compliance management is the cornerstone of the company's sound operation in Indonesia.

1.Tax Compliance::

• monthly: Make Value Added Tax (VAT) declarations and payments (if applicable).
• season (sports): Prepayment of corporate income tax.
• year (e.g. school year, fiscal year): Submission of annual corporate income tax returns.
• extremely important: Even if a company has no business income for the time being, it must file regular tax zero returns or face penalties.

2.Periodic reporting obligations::

• Semi-annual Investment Activity Reports (LKPM) are submitted to the Investment Coordination Board (BKPM) through the OSS system, describing capital utilization and employment.

3.Maintenance and updating of information::

• Any changes in company address, directors, shareholders, registered capital or business scope must be updated and filed with the OSS system and relevant organizations within a specified period of time (usually within 30 days after the change).

4.file storage::

• All financial books, transaction vouchers, bank documents and other records must be properly kept for at least 10 years in case of possible tax audits.

VI. Summary and key recommendations

Entering the Indonesian market presents both opportunities and challenges. To maximize the probability of success, it is recommended that you:

• pre-survey: Be sure to verify the latest foreign investment access policy for your industry through official channels or professional organizations.
• Seek professional support: Indonesia has complex regulations and processes, as well as language and cultural differences. Appointing an experienced and reputable professional service organization can help you complete the landing efficiently and compliantly and avoid potential risks.
• Building Compliance Awareness: Compliance has been a top priority since the company's inception, with clear internal processes or outsourced services in place to ensure timely fulfillment of all filing obligations.

In today's digital economy environment in Indonesia, which is constantly being regulated, operating in compliance by registering a local company is not only a key to open the door to the market, but also a fundamental guarantee for companies to build lasting competitiveness and achieve sustainable development.