When regulations evolve, Globy adapts — and helps everyone else do the same.
The good news: Indonesia has just lowered the entry barrier. Indonesia’s Ministry of Investment (Badan Koordinasi Penanaman Modal or BKPM) has taken a bold, pro-business step. With the issuance of Regulation No. 5 of 2025, the paid-up capital requirement for foreign-owned companies (PT PMA) has been reduced from Rp10 billion to Rp2.5 billion per Klasifikasi Baku Lapangan Usaha Indonesia (KBLI).
The intent is clear: to encourage more mid-sized investors to enter the market, recognise non-cash investment contributions (equipment, studies, land, construction), allow integrated KBLI projects under a single investment plan, and align Indonesia’s entry thresholds with ASEAN competitiveness levels.
💡 Globy’s view: “This reform isn’t just about lowering numbers — it’s about widening the door.”
For many aspiring investors who found the old Rp10 billion paid-up capital rule too steep, this feels like a genuine breakthrough.
Until… they knock on Immigration’s door.
The Catch: Immigration Hasn’t Caught Up Yet
Here’s where the story twists.
While BKPM now recognises companies with just Rp2.5 billion in paid-up capital, Immigration still requires an investor to personally hold at least Rp10 billion in shares to qualify for an Investor Visa/ITAS/KITAP.
This requirement is set out in:
- Permenkumham No. 22 of 2023, as amended by 11 of 2024, and reinforced by the Directorate General of Immigration, which verifies a minimum Rp10 billion shareholding per foreign investor for Investor ITAS eligibility.
Globy’s reflection: “You can invest in Indonesia — you just can’t call yourself an investor at the airport.”
Two Ministries, Two Speeds
- BKPM handles investment licensing, capital registration, and OSS filings.
- Immigration (under the Indonesian Ministry of Law & Human Rights) governs residency and stay permits.
Both are part of the same reform ecosystem — but they move on different timelines.
BKPM’s capital reform took effect in 2025. Meanwhile, Immigration’s visa framework was last updated in late 2024 — and still reflects the old, higher thresholds.
That means a foreign shareholder who invested Rp2.5 billion may still have to apply for a Working ITAS/KITAP, even though the spirit of the BKPM reform was to make investment easier.
💬 Globy’s tip: “This reform is the most sweeping clean-up since 2021. It’s not about changing the rules — it’s about making them readable.”
These regulatory gaps create several challenges for investors. Different regional offices may interpret eligibility requirements inconsistently, leading to compliance confusion.
Investors who previously held Investor ITAS permits may face difficulties with renewal or even downgrades under the new interpretation.
Overall, this results in mixed messaging — while the new law signals a warm “Welcome!” to investors, Immigration’s framework still effectively says “Not yet.”
Globy’s thought: “Indonesia’s investment reform is running a marathon — but immigration’s still tying its shoes.”
What Can Be Done?
- Stay compliant: If your personal shareholding is below Rp10 billion, use a Working ITAS/KITAP.
- Monitor immigration updates: Alignment usually comes within 6–12 months after major BKPM changes.
- Advocate through chambers: AmCham, EuroCham, and BritCham can push for policy alignment.
- Plan your capital: Consider a share increase to meet the Investor Visa eligibility.
Globy’s Insight: “Every regulation in Indonesia has two clocks — the letter of the law and the rhythm of implementation.”
What’s Next?
Based on past policy cycles (OSS 2018, Risk-Based Licensing 2021), Immigration typically aligns within 6–12 months after a BKPM reform. If that pattern holds, expect a revised Investor Visa rule by mid-to-late 2026.
Until then, investors can enjoy the lower entry barriers — just not yet the visa that goes with them.
Final Thought
Indonesia’s regulatory reform is moving in the right direction — just not yet in unison. BKPM has opened the door; now Immigration needs to unlock it fully.
The Permit House helps investors navigate these parallel pathways with clarity, compliance, and confidence.
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