Frequently Asked Questions: #bkpm

The timeline for establishing a PMA (Penanaman Modal Asing) company in Indonesia can vary depending on several factors, but generally, it takes about 2-3 months from start to finish. Here’s a breakdown of the process:

• Pre-application preparation: 1-2 weeks
  • Gathering required documents
  • Checking the Positive Investment List (Perpres 10/2021 jo. 49/2021) for any sector conditions
  • Preparing the investment plan
• OSS investment registration: 3-4 weeks
  • Submitting the investment registration via the OSS (Online Single Submission) system (Ministry of Investment and Downstream Industry/BKPM)
  • Waiting for approval
• Company registration: 2-3 weeks
  • Registering with the Ministry of Law (Kementerian Hukum)
  • Confirming a registered office address (legal domicile) — a separate domicile certificate is no longer required
  • Acquiring Tax Identification Number (NPWP) and Business Identification Number (NIB)
• Obtaining licenses and permits: 2-4 weeks
  • Applying for and receiving necessary business licenses
  • This timeline can vary depending on the specific industry and local regulations
• Bank account setup: 1-2 weeks
  • Opening a corporate bank account

Factors that can affect the timeline include:

• Completeness and accuracy of submitted documents
• Complexity of the business structure
• Responsiveness of government agencies
• Any additional requirements specific to your industry

It’s important to note that working with experienced professionals, such as Okusi Associates, can help streamline the process and potentially reduce delays. They can guide you through each step, ensure compliance with current regulations, and handle much of the paperwork and communication with government agencies on your behalf.

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The LKPM (Laporan Kegiatan Penanaman Modal) is the quarterly investment activity report every PMA company must lodge with BKPM through the OSS system, whether or not anything happened in the quarter. A missed quarter is common — new companies often do not realise the obligation starts immediately — and it is recoverable if addressed promptly.

What actually happens:

• BKPM’s sanction ladder is progressive: written warnings come first, and only sustained non-compliance escalates towards suspension and, ultimately, revocation of business licensing
• The system flags non-filers; ignoring the flag is what converts an administrative slip into a licensing problem
• A company with one missed quarter and an otherwise clean record regularises by resuming filing and responding to any warning received — the earlier, the cleaner

To regularise you will need the company’s OSS access in order, the investment realisation figures for the missed period (capital expenditure, workforce, and for newer companies the realisation against the investment plan), and consistent numbers: LKPM figures should reconcile with the accounts, because BKPM and the tax office increasingly compare notes.

Two related points from client questions:

• One filing covers the company, per project/location — a company with several KBLI lines reports its activity accordingly; confirm scope rather than assuming one line was “included” in another’s filing
• Dormant does not mean exempt — a zero-activity company files a zero-activity LKPM

Okusi prepares and lodges LKPM filings as part of compliance packages, including catch-up filings for companies that have fallen behind.

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