Can Foreigners Open Restaurant in Indonesia

2011-09-22 18.44.25Foreigners can open restaurants in Indonesia. However, foreigners must have an Indonesian Partner(s). Based on the negative list regulation (Government Regulation 36/2010) on List of Business that opens/closes for the Foreign Investment, stipulates that the composition of shares of the Foreigner(s) is maximum 51% for restaurant industries.

The foreigner(s) and Indonesian partner(s) enter a joint venture agreement. Then, they submit a foreign investment application to the Investment Coordinating Body of Indonesia (“Badan Koordinasi Penanaman Modal Asing or BKPM”). After receiving the BKPM approval, then the foreigners & Indonesian partner(s) may set up an Indonesian entity (PT PMA or Foreign Investment Limited Liability Company) under the Indonesian Law.

The foreigner(s) may hold position in the Company except as a Human Resources Director. When a PT PMA hires an expatriate, a PT PMA must have a plan of expatriates utilization (“Rencan Penggunaan Tenaga Kerja Asing or RPTKA”) and Working Permits (“Izin Mempekerjakan Tenaga Asing or IMTA”).

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