Foreign investors looking to establish a business in Indonesia must be aware of the restrictions on foreign ownership in certain industries.
These restrictions are part of Indonesia’s efforts to protect local industries and promote national interests.
This guide provides an overview of the industries with foreign ownership limitations and the extent of these restrictions.
Are There Any Restrictions on Foreign Ownership in Certain Industries?
Yes, there are restrictions on foreign ownership in several industries in Indonesia.
These restrictions are detailed in the Positive Investment List (Daftar Investasi Positif) and other regulations issued by the Indonesian government.
Key industries with foreign ownership limitations include:
- Telecommunications:
Ownership Limit: Up to 67% foreign ownership.
Notes: Applies to telecommunications networks and services.
- Maritime and Fisheries:
Ownership Limit: Up to 49% foreign ownership for certain fisheries activities.
Notes: Includes capture fisheries and fish processing.
- Energy and Mineral Resources:
Ownership Limit: Varies; for example, up to 75% for power plant projects and up to 95% for oil and gas drilling services.
Notes: Specific limitations depend on the sub-sector and project type.
- Education:
Ownership Limit: Up to 67% foreign ownership for higher education institutions.
Notes: Applies to universities, colleges, and other higher education providers.
- Health Services:
Ownership Limit: Up to 67% foreign ownership for private hospitals.
Notes: Includes general and specialized hospitals.
- Retail and Distribution:
Ownership Limit: Up to 67% foreign ownership for large-scale retail and distribution.
Notes: Restrictions apply to hypermarkets, supermarkets, and department stores.
- Media:
Ownership Limit: Up to 20% foreign ownership.
Notes: Applies to print media, radio, and television broadcasting.
- Tourism:
Ownership Limit: Up to 67% foreign ownership for tourism and travel-related services.
Notes: Includes hotels, resorts, and travel agencies.
Consult with Abhitech as Your EOR Provider
Navigating the complexities of foreign ownership restrictions can be challenging for investors.
Abhitech, as an experienced Employer of Record (EOR) service provider, can assist by:
- Regulatory Guidance: Offering expert advice on foreign ownership limitations specific to your industry.
- Compliance Assistance: Ensuring your business structure adheres to ownership regulations.
- Local Partnerships: Facilitating connections with reliable local partners if required by regulations.
With over 30 years of experience, Abhitech provides comprehensive support to help you establish and grow your business in Indonesia confidently and compliantly.
Sources
Indonesia Investment Coordinating Board (BKPM): Detailed information on foreign investment regulations and industry-specific ownership limitations.
BKPM
Ministry of Law and Human Rights: Guidelines on business entity establishment and ownership requirements.
Ministry of Law and Human Rights
Positive Investment List: Official document listing sectors with foreign ownership limitations.
Positive Investment List
For personalized guidance and assistance, contact Abhitech to ensure your business setup in Indonesia is handled efficiently and in full compliance with local laws.
