Investment Holding Company in Indonesia: Setup, Cost, Rules
An investment holding company in Indonesia is almost always structured as a PT PMA, the foreign investment limited liability company, registered under KBLI code 64200 for holding company activities. It holds shares in one or more operating subsidiaries instead of trading itself. Foreigners can own it 100 percent in most sectors. It requires planned investment of at least IDR 10 billion per business line, with roughly a quarter of that paid up front, and takes about four to eight weeks to register through the OSS system. It still files tax returns and quarterly investment reports even if it never generates revenue.
If you own a villa, a restaurant, a dive operation or a consulting business in Bali through separate PT PMAs, a holding company is usually what you set up next, once you want one structure sitting above all of them for succession, financing or an eventual sale.
On this page
- What a holding company actually is under Indonesian law
- How much it costs
- Minimum capital requirements
- How to set one up, step by step
- Holding company vs operating PT PMA vs offshore structure
- Can foreigners own 100 percent
- Ongoing compliance after incorporation
- The nominee shareholder trap
- FAQ
What a holding company actually is under Indonesian law
Indonesia does not have a special legal form called a "holding company." What you are setting up is an ordinary PT PMA whose registered business activity, under KBLI 64200, is to hold and manage equity in other companies rather than to trade, build, or serve guests directly. The subsidiaries underneath it can be PT PMAs or local PT companies, each running its own license, its own KBLI code, and its own staff.
People building an investment holding company in Indonesia usually fall into one of three groups: an owner with three or four separate businesses who wants one entity above them for clean accounting and a future sale, a family wanting to put Indonesian assets into a structure that survives a death or divorce without a scramble, or an investor bringing outside capital in who wants a single point of entry rather than funding five companies separately.
How much it costs
There is no fixed government price list for this, because the bulk of the cost is professional fees, not state fees. Expect the heaviest cost to be the paid up capital itself, not the paperwork.
| Item | Typical range | Notes |
|---|---|---|
| Notary deed and Kemenkumham approval | USD 800 to 1,800 | Varies by notary and number of shareholders |
| NIB and licensing via OSS | Included or USD 300 to 600 | Government portal is free; this covers professional handling |
| Registered office / virtual address (if required) | USD 300 to 1,000 per year | Depends on region and whether a physical lease is needed |
| Paid up capital deposit | IDR 2.5 billion minimum | Roughly 25 percent of IDR 10 billion planned investment, per KBLI, confirm current threshold |
| Annual tax filing and LKPM reporting | USD 400 to 1,200 per year | Required even with zero trading activity |
Get a fixed fee quote in writing before you commit. Firms that quote a single bundled "setup fee" without listing the capital deposit separately are usually hiding the real number inside it.
Minimum capital requirements
Under current BKPM rules, a PT PMA needs a planned investment of at least IDR 10 billion per KBLI code per project location, excluding the value of land and buildings. At least 25 percent of that, around IDR 2.5 billion, must actually be deposited as paid up capital before the licensing can be completed. This threshold is reviewed periodically, so confirm the current figure with your notary or BKPM before you wire anything.
For a pure holding company this capital is the value of the shares it holds in subsidiaries, not idle cash sitting in a bank account. If your holding company will own shares in a villa PT PMA worth IDR 4 billion and a restaurant PT PMA worth IDR 3 billion, that contributed share value can usually count toward meeting the threshold, structured correctly by the notary.
How to set one up, step by step
- Name reservation and deed drafting. A notary drafts the deed of establishment, naming at least two shareholders, one director and one commissioner.
- Ministry of Law approval. The deed is filed with Kemenkumham for legal entity status, usually taking one to two weeks.
- Tax registration (NPWP). The company gets its own tax identification number, mandatory even if dormant.
- NIB and licensing via OSS. The business registration number and risk based license are issued through the Online Single Submission system under KBLI 64200.
- Corporate bank account. Banks will want the deed, NIB, NPWP and proof of a registered address before opening an account.
- Capital injection. Paid up capital is deposited and reported, closing out the licensing requirement.
Total time from first deed to a fully licensed, bankable company usually runs four to eight weeks. It stretches when a subsidiary's KBLI code requires an extra sector approval, or when the bank's compliance team asks for more documentation on the ultimate beneficial owner, which is now standard practice across Indonesian banks.
Holding company vs operating PT PMA vs offshore structure
Some investors ask whether they should hold Indonesian assets through a Singapore or Hong Kong entity instead of an Indonesian holding PT PMA. Both exist in the market for good reasons, and the right answer depends on where the investor is tax resident and what the exit plan looks like.
| Structure | Foreign ownership | Typical use | Main drawback |
|---|---|---|---|
| Indonesian holding PT PMA | Up to 100 percent in most sectors | Consolidating multiple local businesses, succession planning | Still subject to Indonesian corporate tax and LKPM reporting |
| Operating PT PMA only (no holding layer) | Up to 100 percent in most sectors | Single business, simplest structure | Harder to sell or finance multiple assets as one unit |
| Offshore holding company (e.g. Singapore) | N/A, holds the Indonesian PT PMA shares | Investors wanting treaty access or an exit outside Indonesian courts | Substance requirements, dividend withholding tax, extra compliance in two jurisdictions |
Can foreigners own 100 percent
In most sectors, yes. Indonesia's Positive Investment List, which replaced the old Negative Investment List under the Job Creation Law, opened the large majority of business classifications to 100 percent foreign ownership. A small number of sectors remain closed or capped, and some require partnership with a local cooperative or small business. A holding company itself, classified under KBLI 64200, is not on the restricted list, but the subsidiaries it holds still need to be checked individually against the current Positive Investment List before you assume full ownership is possible.
If any director or commissioner plans to live in Bali and actively run the business, they will need a work KITAS tied to the company, separate from the shareholding question. Our Bali work visa and KITAS guide covers what that director sponsorship involves in practice.
Ongoing compliance after incorporation
A holding company does not get to skip reporting just because it does not trade. Every PT PMA, holding or operating, must file an LKPM (Laporan Kegiatan Penanaman Modal) investment activity report, typically quarterly, through the OSS system. Missing these filings repeatedly can lead to warnings and, eventually, revocation of the business license, even if the company has zero transactions to report.
Annual corporate tax returns are also mandatory regardless of activity level, with Indonesia's standard corporate income tax rate sitting around 22 percent, confirm the current rate with your tax advisor since this is periodically revised. Dividend flows out of Indonesia to a foreign shareholder are generally subject to withholding tax unless reduced under a tax treaty, which is one reason some groups route ownership through a treaty jurisdiction above the Indonesian holding company.
If the holding structure is part of a broader move to Bali with family, it's worth lining up the corporate work and the visa side together. Our Bali family visa page and work permit and residence visa guide cover the immigration half of that.
The nominee shareholder trap
The single most expensive mistake we see: a foreigner uses a local individual as a "nominee" shareholder to hold company shares or, worse, freehold land, with a private side agreement promising the asset is really theirs. Indonesian courts have repeatedly refused to enforce these side agreements. Agrarian law restricts freehold land ownership to Indonesian citizens, and nominee arrangements around it carry real risk of total loss if the nominee dies, divorces, is sued, or simply changes their mind. There is no side letter that reliably overrides this in court. A properly capitalised PT PMA holding company, with real paid up capital and genuine legal ownership, is the lawful route to the same control a nominee arrangement pretends to offer, without the exposure.
FAQ
What is an investment holding company in Indonesia?
It is a PT PMA, the standard foreign investment company, registered under KBLI code 64200 for holding company activities. Instead of trading itself, it owns shares in one or more operating subsidiaries, such as a villa business or a restaurant, giving the owner one legal structure sitting above several underlying businesses.
How much capital do I need to set up a holding company in Indonesia?
The general rule for a PT PMA is a planned investment of at least IDR 10 billion per business classification per location, excluding land and buildings, with around 25 percent, roughly IDR 2.5 billion, required as paid up capital before licensing completes. This threshold is reviewed periodically, so confirm the current figure with a notary or BKPM before committing funds.
Can a foreigner own 100 percent of an Indonesian holding company?
In most sectors, yes. Indonesia's Positive Investment List allows full foreign ownership across the large majority of business classifications, including holding company activities under KBLI 64200. A small number of sectors remain restricted or require a local partner, so check the subsidiary's specific KBLI code against the current list rather than assuming.
How long does it take to set up a PT PMA holding company?
From the first notarial deed to a fully licensed, bankable company, the process typically takes four to eight weeks. It can run longer if a subsidiary's business classification needs a separate sector approval, or if the bank requests additional documentation on the ultimate beneficial owner during account opening.
What is the difference between a holding company and an operating company in Indonesia?
An operating PT PMA trades directly, employing staff and generating revenue under its own KBLI code. A holding PT PMA under KBLI 64200 does not trade; it owns shares in other companies instead. Investors with multiple local businesses often add a holding company above them for cleaner accounting, easier succession, and a simpler sale process later.
Do I need to report anything after the holding company is set up?
Yes. Every PT PMA must file a quarterly LKPM investment activity report through the OSS system, and an annual corporate tax return, regardless of whether it traded. Skipping these filings repeatedly can lead to license warnings and eventual revocation, even for a dormant holding company with no transactions.
Can I use a nominee to hold shares in my Indonesian company?
You can arrange it, but Indonesian courts have consistently declined to enforce private side agreements behind nominee shareholdings, particularly around land. The legally sound route to full control for a foreigner is a properly capitalised PT PMA with genuine ownership, not a nominee structure with an informal promise attached.
What KBLI code do I use for a holding company?
Holding company activities are classified under KBLI 64200 in Indonesia's current business classification system, used by the OSS licensing portal. The subsidiaries it holds shares in will each carry their own separate KBLI codes matching their actual business, such as accommodation, food and beverage, or consulting.
If you are weighing a holding structure against simply registering one operating PT PMA, our team at The Bali Lawyer can walk through the capital math and the KITAS side together before you sign anything with a notary. See our visa services in Bali page if a director's residence permit needs sorting alongside the company setup.