Can a Foreign Organization Be a Founder of an Indonesian Company? Flado.id Explains

by: Visa Agency
On: Feb 13,2025

Client Asks:

Can a foreign organization be one of the founders of an Indonesian company (one person and one organization)?
Can a foreign company with a common founder pay investments to an Indonesian organization?
Is “Logistics activity” a high-risk business?

Flado.id Replies

Foreign Organization as a Founder of an Indonesian Company

Yes, a foreign organization can be a founder of an Indonesian company, specifically through a Foreign Investment Company (PT PMA). Indonesian corporate law requires at least two shareholders, which can be individuals or legal entities.

This means that a PT PMA can be established by one foreign organization and one individual, regardless of the individual’s nationality. Another option is to set up a representative office before fully forming a company.

Investment from a Foreign Company to an Indonesian Organization

A foreign company with a common founder can invest in an Indonesian organization, provided it follows Indonesian investment regulations. Such transactions must comply with foreign investment laws, taxation policies, and anti-money laundering rules.

Using a representative or an authorized local partner can help manage the process legally and efficiently. Proper documentation is necessary to ensure compliance with Indonesian financial regulations.

Is “Logistics Activity” a High-Risk Business in Indonesia?

Unlike the first two points, the risk level of a business depends only on its KBLI classification (business activity code), not its structure or ownership.

The Indonesian government follows a risk-based approach to licensing, and business activities are categorized as:

Low risk
Medium-low risk
Medium-high risk
High risk

Below are some logistics-related KBLI codes and their risk classifications:

KBLI 52101 (Low Risk) – Warehousing and Storage (More info)
KBLI 52293 (Low Risk) – Freight Forwarding (EMKL) (More info)
KBLI 52294 (Medium-High Risk) – Air Cargo Expedition (EMPU) (More info)
KBLI 52292 (Risk level varies) – Rail and Land Cargo Expedition (EMKA & EAD) (More info)
KBLI 53201 (High Risk) – Courier Services (More info)
KBLI 52297 (Medium Risk) – Multimodal Transport (More info)
KBLI 52299 (Low Risk) – Other Transport Support Activities (More info)