Indonesia recently issued and implemented BKPM Regulation No. 5/2025, imposing stricter rules on foreign direct investment (PMA). In terms of general investment requirements, PMA is considered a large enterprise. Unless otherwise specified, the total investment (excluding land and buildings) for each five-digit KBLI business field and project location must exceed IDR 10 billion.
For PMA in the form of a limited liability company, the minimum paid-up capital is IDR 2.5 billion, and the funds must not be transferred out of the account for at least 12 months from the time of payment (except for purchasing assets, constructing buildings, and business operations, etc.). Enterprises are required to make a self-declaration when applying for a business license through the OSS system. Violations will result in administrative sanctions.
Some industries have investment exemptions, such as wholesale trade, food and beverage services, construction, and single-production-line manufacturing. Different industries have different investment thresholds and calculation methods. Location restrictions for food and beverage services are based on regency/city. Investment in specific industries such as real estate development includes land and buildings. Investment in public EV charging stations is calculated by province. Enterprises in special economic zones must follow the relevant presidential regulations.
This regulation aims to ensure that PMA involves large-scale business activities with a clear capital structure and long-term commitment. It strengthens the legal and financial foundation of PMA permits, clarifies investor responsibilities and transparency, while providing strategic flexibility for enterprises in different industries. Enterprises must comply with the regulations to avoid penalties and ensure business legality.
Indonesia recently issued and implemented BKPM Regulation No. 5/2025, imposing stricter rules on foreign direct investment (PMA). In terms of general investment requirements, PMA is considered a large enterprise. Unless otherwise specified, the total investment (excluding land and buildings) for each five-digit KBLI business field and project location must exceed IDR 10 billion.
For PMA in the form of a limited liability company, the minimum paid-up capital is IDR 2.5 billion, and the funds must not be transferred out of the account for at least 12 months from the time of payment (except for purchasing assets, constructing buildings, and business operations, etc.). Enterprises are required to make a self-declaration when applying for a business license through the OSS system. Violations will result in administrative sanctions.
Some industries have investment exemptions, such as wholesale trade, food and beverage services, construction, and single-production-line manufacturing. Different industries have different investment thresholds and calculation methods. Location restrictions for food and beverage services are based on regency/city. Investment in specific industries such as real estate development includes land and buildings. Investment in public EV charging stations is calculated by province. Enterprises in special economic zones must follow the relevant presidential regulations.
This regulation aims to ensure that PMA involves large-scale business activities with a clear capital structure and long-term commitment. It strengthens the legal and financial foundation of PMA permits, clarifies investor responsibilities and transparency, while providing strategic flexibility for enterprises in different industries. Enterprises must comply with the regulations to avoid penalties and ensure business legality.