Frequently Asked Questions: #convert-local-pt-to-pma

Yes — and if any foreign party acquires any shareholding in a local PT (PMDN), conversion is not optional: the company becomes a PMA by definition and must be brought into the PMA regime.

The conversion is a defined corporate process rather than a re-incorporation:

• Shareholder approval (general meeting or circular resolution) of the share transfer or issue to the foreign party
• A notarial deed recording the change, notified to the Ministry of Law
• Amendment of the company’s investment status and data in the OSS licensing system to PMA
• Compliance with PMA capital requirements — paid-up capital and the investment plan
• Commencement of PMA reporting obligations, notably the quarterly LKPM investment report

The questions clients raise most, briefly:

• Timeline — typically measured in weeks once documents are ready; the notarial and ministry steps are predictable, licensing adjustments less so
• Bank accounts — the company continues; accounts are updated, not closed, though banks will re-do their know-your-customer checks
• Presence — much of the process can be handled under power of attorney, but plan for some notarised documents and, depending on the bank, in-person appearances
• Tax — a PMA is not taxed differently from a local PT; corporate tax rates and monthly employee filings are the same. The differences are in capital, licensing and reporting, not tax rates
• KBLI check first — before converting, verify the company’s business classifications are actually open to foreign ownership at the intended percentage; this kills more conversions than any other issue

Conversion is also the honest exit from a nominee arrangement — replacing a concealed foreign interest with a lawful, registered one.

See our full guide: Converting a local PT to a PMA.

#PMAcompany   #companyEstablishment   #foreignOwnershipRestrictions   #businessRegistration