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    Bali Visa > Blog > Company Establishment > Investing in Bali Real Estate: PMA Companies & KBLI Code 68
PMA Real Estate in Bali
May 4, 2024

Investing in Bali Real Estate: PMA Companies & KBLI Code 68

  • By Syal
  • Company Establishment

Bali, Indonesia, is not just a paradisiacal destination for tourists but also a land brimming with opportunities, especially in the real estate sector. 

Setting up in the Indonesian real estate market can be challenging, yet rewarding, particularly for foreign investors. 

This is where understanding the process of PT PMA setup becomes crucial. A PT PMA (Penanaman Modal Asing) is a foreign investment company which is the only legal entity through which foreigners can directly engage in business activities in Indonesia, including real estate, under KBLI Code 68.

Our journey begins with an in-depth look into the potential that Bali’s real estate market holds. 

We explore the benefits of a PT PMA setup, from ownership rights to tax advantages, and how it aligns with Indonesia’s regulations under KBLI Code 68. 

Whether you’re a seasoned investor or new to the Indonesian market, this guide aims to illuminate the path towards successful real estate investment in Bali, ensuring you have all the necessary tools and knowledge for a PT PMA setup. 

Join us as we unlock the potential of Bali’s real estate, a venture that promises not just scenic views but also substantial returns.

 

Ready to explore?

Table of Contents

  • Overview of Bali, Indonesia Real Estate Market for Foreign Owned Company PT PMA Setup (KBLI Code : 68)
  • Business Code Mapping for Foreign Owned Company PT PMA Setup in Bali, Indonesia Real Estate (KBLI Code: 68)
  • Bali, Indonesia Real Estate Activities for a Foreign Owned Company PT PMA Setup (KBLI Code: 68)
  • Resources
  • Frequently Asked Questions

Overview of Bali, Indonesia Real Estate Market for Foreign Owned Company PT PMA Setup (KBLI Code: 68)

Embarking on Bali’s real estate journey takes on a strategic dimension with the establishment of a PT PMA (Perseroan Terbatas Penanaman Modal Asing). Here’s a breakdown of why a PT PMA setup is crucial for navigating and capitalizing on the burgeoning real estate market in Bali, particularly under Business Code 68:

 

  • Facilitating Foreign Investment: PT PMA serves as a pivotal facilitator for foreign investors, providing a legal structure that allows direct participation in Bali’s dynamic real estate activities, encompassing property development, transactions, and management.

 

  • Aligning with Business Code 68: Business Code 68 is the linchpin to Bali’s real estate realm, and a PT PMA ensures meticulous adherence to Indonesian regulations. This structure aligns seamlessly with the specific legal framework governing real estate activities, establishing a secure and compliant foundation for foreign entities.

 

  • Navigating Foreign Ownership Restrictions: Foreign investors encounter restrictions on outright land ownership in Indonesia. PT PMA, with its Indonesian shareholder component, serves as a strategic solution, facilitating compliance with foreign ownership regulations. This includes offering alternatives like leasehold arrangements for property development.

 

  • Tapping into a Thriving Market: Bali’s real estate market is thriving, propelled by a robust tourism industry and escalating interest from both international and domestic buyers. PT PMA strategically positions investors to tap into this dynamic market, leveraging the island’s popularity and a diverse array of property opportunities.

 

  • Streamlining Licensing and Regulatory Compliance: PT PMA becomes the conduit for a smoother process in obtaining licenses and permits necessary for real estate activities in Bali. This encompasses navigating through the intricacies of zoning regulations, construction permits, and other essential approvals, ensuring a seamless operational journey.

 

  • Navigating Tax Considerations and Financial Planning: PT PMA status empowers investors to effectively manage tax considerations related to real estate transactions and property ownership. This includes navigating property taxes, corporate income tax, and other financial aspects critical for sustainable and prosperous business operations.

 

  • Encouraging Cultural Sensitivity and Local Integration: A PT PMA setup actively encourages cultural sensitivity and local integration. Recognizing and respecting Bali’s unique cultural context is paramount for successful real estate operations, and the PT PMA structure provides a robust framework for harmonious engagement with the local community.

 

  • Strategically Growing the Investment Portfolio:PT PMA in Bali’s real estate market becomes a catalyst for strategic growth, allowing investors to diversify their portfolio with a focus on residential, commercial, or tourism-related developments. The flexibility of PT PMA supports a resilient investment strategy, ensuring adaptability in a dynamic market.

 

In essence, a PT PMA setup in Bali’s real estate market, especially under Business Code 68, is not merely a choice but a strategic imperative. It provides a legal, compliant, and culturally sensitive pathway for foreign investors to unlock the vast potential of this dynamic island paradise.

Business Code Mapping for Foreign Owned Company PT PMA Setup in Bali, Indonesia Real Estate (KBLI Code: 68)

business image mapping

Business code 68 in Indonesia covers a wide range of real estate activities. For a PT PMA specifically, the permissible activities within this code depend on the sub-categories chosen at registration. Here’s a breakdown:

Business Code Mapping 68

68 Real Estate

681 : Self-owned or rented real estate and tourism areas

    • 6811 Self-owned or rented real estate
      • 68111 Self-owned or leased real estate
      • 68112 Venue Rental for MICE Activities and Special Events
    • 6812 Tourism Area
      • 68120  Tourism Areas
    • 6813 Industrial Estate
      • 68130 Industrial Estate

682 : Real estate on a fee or contract basis

    • 6820 Real estate on a fee or contract basis
      • 68200 Real estate on a fee or contract basis

 

Bali, Indonesia Real Estate Activities for a Foreign Owned Company PT PMA Setup (KBLI Code: 68)

Real Estate Activities cover a broad spectrum of activities related to the development, purchase, sale, and management of real property.

For a PT PMA engaged in Real Estate Activities in Bali, there are several aspects and considerations to keep in mind:

  • Business Scope:

Your company may engage in various real estate activities, including property development, buying and selling of land and properties, leasing, property management, and related services.

  • Foreign Ownership Restrictions:

PT PMA companies in Indonesia have certain restrictions on foreign ownership, and it’s important to ensure compliance with the prevailing regulations. You may need to have a certain percentage of Indonesian ownership.

  • Land Ownership:

Foreign entities are generally restricted from owning land outright in Indonesia. However, there are options available, such as leasehold arrangements, to enable foreign companies to use land for specific purposes.

  • Licenses and Permits:

Real Estate Activities typically require specific licenses and permits from local authorities. This can include land permits, construction permits, and business licenses. Make sure to obtain all necessary approvals before starting operations.

  • Taxation:

Understand the tax implications of real estate activities in Indonesia. This includes property taxes, corporate income tax, and other applicable taxes.

  • Zoning Regulations:

Comply with local zoning regulations and land use planning. Certain areas may have specific restrictions or requirements for real estate development.

  • Environmental Regulations:

Be aware of and comply with environmental regulations related to real estate development. This may include environmental impact assessments and compliance with environmental standards.

  • Labor Regulations:

Understand labor laws and regulations in Indonesia, including employment contracts, wages, and other relevant aspects of human resources management.

  • Legal Assistance:

Given the complexity of real estate activities, it’s advisable to seek legal assistance from professionals familiar with Indonesian laws and regulations, especially those specific to Bali.

  • Cultural Sensitivity:

Bali is known for its unique culture, and it’s important to be culturally sensitive in your business activities. Understanding local customs and norms can contribute to successful business operations.

Resources:

  • Online Single Submission System (OSS)
  • Indonesian Investment Coordinating Board (BKPM)
  • Ministry of Agrarian Affairs and Spatial Planning/National Land Agency (ATR/BPN)
  • Indonesian Real Estate Association (REI)
  • Indonesian Chamber of Commerce and Industry (KADIN)

Frequently Asked Questions

  • What are the primary real estate activities that a PT PMA can engage in under Business Code 68 in Bali?

    PT PMA companies under Business Code 68 can participate in property development, buying and selling of real estate, leasing and rental management, real estate consultancy, property management, land use planning, and compliance with foreign ownership restrictions.

  • Are there specific environmental regulations that PT PMA companies must consider for real estate development in Bali?

    Yes, PT PMA companies must be aware of and comply with environmental regulations related to real estate development. This may include conducting environmental impact assessments and adhering to environmental standards.

  • What types of e-commerce businesses might be allowed under a KBLI code 68 PT PMA?

    There's a chance you could be allowed to conduct e-commerce activities related to real estate, such as: - Selling or renting properties online - Offering property management services through an online platform - Providing a platform for real estate agents and developers

Contact PMA Real Estate in Bali, Indonesia.

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Syal

Syal is specialist in Real Estate and majored in Law at Universitas Indonesia (UI) and holds a legal qualification. She has been blogging for 5 years and proficient in English, visit @syalsaadrn for business inquiries.

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