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Alternatives to Setting Up a PT PMA

Set Up a Company in Bali through Special Purpose Vehicle in Bali

Setting up a 100% foreign-owned PT PMA is not the only way to start a lifestyle business in Bali. You can also set up your business through a special purpose vehicle. A special purpose vehicle is a legal entity that holds shares on behalf of another party. In essence, the special purpose vehicle is just a name on the company’s documents.

With a local Indonesian company as your special purpose vehicle, you do not have to follow regulation for foreign-owned companies. Some examples of businesses where special purpose vehicles are common:

  • Restaurants and cafés

  • Surf and diving centers

  • Yoga studios

  • Travel agencies/tour operators

Through a set of agreements, you can have full control of the company even if it is under the name of the special purpose vehicle. This is a safe way of having a local entity holding your shares and will protect your interests. VIVO ASIA can act as your special purpose vehicle in Bali. Get in touch with us by filling out the form below.

When Should You Consider Using a Nominee Company in Bali?


In this article, we describe common scenarios when special purpose vehicles, i.e. nominee companies, are a suitable alternative.

It is not uncommon to register a business in Bali using a nominee company. Foreign companies are subject to higher requirements and because of that, alternatives like using a local nominee shareholder (an inherently unsafe way) and special purpose vehicles (a much safer option) are used.

In this article, we describe common scenarios when special purpose vehicles, i.e. nominee companies, are a suitable alternative.

Common scenarios when you should consider using a nominee company or special-purpose vehicle


The following are scenarios when a foreigner and a foreign-owned company can benefit from using a nominee company in Bali.

When the law restricts foreign ownership

When registering a company in Indonesia, a negative investment list determines which business classifications (KBLI) are open, partially open, and closed for foreign ownership.

For example, below are business classifications that are partially open and closed for 100% foreign ownership based on the newest regulation.



​Business activities

KBLI number

Maximum foreign ownership

Employment services

​78200

49%

Domestic sea transportation for tourism

50113

49%

Manufacturing of traditional medicinal products for humans

21022

0%

Manufacture of traditional cosmetics

20232

0%

Art showcase

90011

0%

Coffee processing industry

10761

0%

Manufacture of wooden buildings goods

16221

0%

If you wish to engage in a business activity that restricts foreign ownership, consider registering using a nominee company in Bali.

Not disclosing the actual owner of the business

There can be various reasons why you’d not want to disclose yourself as the shareholder of a company. The most common (legitimate) reason is that large companies often have strict policies about where and how they can conduct overseas businesses and a special purpose vehicle gives more flexibility.

When you want to get around capital requirements

The required paid-up capital is IDR 10 billion (USD 700.000) for foreign-owned companies. Whereas for local companies, the required capital depends on the scale of the company.

While setting up a nominee company costs more than a regular PT PMA registration in Bali, it allows you to not tie up as much capital.

To illustrate, below are the paid-up capital requirements for local companies.




Size of company

Minimum capital requirement

Foreign shareholders allowed?

Small

>50 million IDR

No

Medium

>500 million IDR

No

Large

>10 billion IDR

No

When you want to combine several small lifestyle businesses into one company

Companies must do their investment reporting separately for each of its business classifications. There is no required investment per business classification for local companies.

But for foreign-owned companies, the required investment is IDR 10 billion per business classification.

If you register three different business classifications, the total investment will be IDR 30 billion. It is a relatively hefty sum for smaller lifestyle businesses.


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