One of the earliest and most consequential decisions for anyone building a business in Bali is choosing the right company structure. The PT PMA vs Local PT question often confuses foreign investors and mixed-nationality couples alike, since each structure carries different implications for ownership, capital, and long-term compliance.
The Core Difference Between PT PMA and Local PT
PT PMA (Foreign Investment Company) is a legal entity that allows share ownership by foreign nationals, either partially or fully, depending on the business sector. A Local PT can only be owned by Indonesian citizens, meaning foreign parties cannot be recorded as direct shareholders.
Aspect | PT PMA | Local PT |
Foreign ownership | Allowed (subject to sector list) | Not allowed |
Minimum paid-up capital | Generally IDR 2.5 billion (varies by KBLI) | Based on founders’ agreement, generally more flexible |
Ownership basis | Foreign shareholding percentage as permitted | 100% Indonesian nationals |
Investor KITAS | Available to foreign shareholders | Not applicable to this structure |
Reporting | LKPM to BKPM + SABH annual report | SABH annual report |
Why Many Foreign Investors Choose PT PMA
For investors who want direct control over their business whether as a director, commissioner, or shareholder PT PMA is the only legal pathway that allows foreign ownership to be officially recorded. This structure also opens the door to applying for an Investor KITAS, allowing the business owner to reside in Indonesia and directly oversee operations.
That said, PT PMA comes with more structured compliance obligations, including periodic investment activity reporting (LKPM) to BKPM, on top of the annual reporting requirement that now applies to all types of PT.
What Changed Under Permenkum No. 49/2025
Since 17 December 2025, the entire process of establishing and amending PT data for both PMA and local entities is now processed exclusively through the Corporate Legal Entity Administration System (SABH), with several important adjustments:
- Beneficial Ownership (UBO) disclosure requirements are now stricter for all types of PT, including PT PMA.
- Annual reporting, previously an internal matter handled only through the shareholders’ meeting (RUPS), must now be formally submitted to the Ministry through SABH, no later than 6 months after the fiscal year ends.
- Company data changes (directors, commissioners, shareholders, address) must be reported within 30 days of the notarial deed being signed.
- Late reporting can result in restricted SABH access, which directly affects a company’s ability to carry out corporate actions such as capital changes or restructuring.
These changes apply to both PT PMA and Local PT, meaning both entity types now face significantly tighter governance standards than before.
Factors to Consider Before Choosing a Structure
- Long-term ownership plans – do you need direct shareholding as a foreign national?
- Residency needs – does the structure need to support an Investor KITAS application?
- Business sector (KBLI) – certain sectors carry specific foreign ownership caps.
- Compliance capacity – PT PMA requires additional LKPM reporting that needs to be managed regularly.
Conclusion
Both PT PMA and Local PT have their place, depending on the investor’s profile, business sector, and long-term plans. What matters most is that, under Permenkum No. 49/2025, both structures now demand a significantly higher level of administrative discipline than before making professional guidance from the planning stage an increasingly valuable step.
Our team helps investors determine the most suitable company structure for their business plans in Bali. Discuss your business needs with our team.
FAQ
Can a Local PT bring in foreign investors later on?
Not directly. If foreign ownership is part of the plan, a PT PMA structure needs to be prepared from the start, or converted through the appropriate legal process.
Does PT PMA always require more capital than a Local PT?
Generally yes, since PT PMA is subject to a specific minimum paid-up capital requirement, while a Local PT is more flexible based on the founders’ agreement.
Is annual reporting now mandatory for all types of PT?
Yes. Since Permenkum No. 49/2025, the annual reporting obligation through SABH applies to both capital-based PT (including PMA) and individual PT (Perorangan).
