Past iadvisory Questions and Answers: Investment in Indonesia

Read on to find out if your company can hold a majority share when setting up an entity in Indonesia.

Can foreigners own a 100% share of a Family Entertainment company (operator of games centers) in Indonesia?

Understand from the Indonesian government website that foreigners can own 100% share up to 15 years and 95% for another 15 years in some industries. Would just like to confirm if this is applicable for our industry and if the information is still valid?

For your reference, the 100% ( first 15 years) followed by 95% (next 15 years) requirement no longer applies since the Investment Law was revised in mid-2007.

Since then, 100% foreign ownership is permitted (with no requirement to sell 5% share after 15 years), but is subjected to maximum percentage ownership for industries specified in the Negative List.

The latest version of the Negative List was issued in late 2007. This specifies that the maximum foreign ownership permitted in a company providing Family/Arcade Entertainment is 50%. Therefore it would be necessary for you to carry out a joint venture with an Indonesian individual or with a company that is 100% owned by Indonesians.

Click here for Indonesia’s Negative Investment List.

All answers are provided to the best knowledge of the iadvisors at the point of answering, and are solely represented by the iadvisors, not IE Singapore.

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