BKPM Regulation No. 5 of 2025: New PT PMA Capital Rules Explained

Indonesia has officially introduced a major update to its foreign investment framework through BKPM Regulation No. 5 of 2025. The change brings welcome flexibility for foreign-owned companies (PT PMAs) and reinforces the government’s commitment to attracting sustainable long-term investment. 

Here’s what the new regulation means for current and prospective investors. 

A Significant Shift: Paid-Up Capital Reduced to IDR 2.5 Billion

Under the new BKPM Regulation No. 5 of 2025, the minimum paid-up capital requirement for PT PMAs has been lowered from IDR 10 billion to IDR 2.5 billion. 

This reform aims to: 

• Encourage the establishment of more compliant investment structures 

• Provide businesses with greater financial flexibility in their first years of operation 

For many small-to-medium foreign enterprises, this reduction is a meaningful step in easing the barrier for entry. 

Minimum Investment Value Remains IDR 10 Billion 

While paid-up capital has been reduced, the total investment value requirement remains unchanged. PT PMAs must still realise more than IDR 10 billion in total investments. 

This investment value includes: 

• Paid-Up Capital 

• Asset Purchases  

• Working Capital 

• Operational Expenditures 

• Loans and External Funding Sources 

In other words, the government is providing flexibility on how you structure your investment, not lowering the overall investment expectation. 

How BKPM Tracks Your Investment: LKPM Reporting 

BKPM verifies your investment progress through the LKPM (Quarterly Investment Activity Reports). These reports remain one of the most important compliance obligations for all PT PMAs. 

Accurate LKPM submissions ensure that: 

• Your investment realisation is properly recorded 

• You demonstrate progress toward the >IDR 10 billion requirement 

• You avoid warnings, compliance notes, or potential deregistration issues 

Even with the relaxed capital rule, LKPM remains a non-negotiable compliance requirement. 

Investor KITAS Requirements Remain Unchanged 

BKPM Regulation No. 5 of 2025 does not change immigration rules. To qualify for (or maintain) an Investor KITAS, each investor must still hold a minimum share ownership of IDR 10 billion per individual. 

This requirement is set by Immigration, not BKPM, meaning: 

• The lower paid-up capital rule does not impact Investor KITAS eligibility.

• Clients must continue to structure shareholding with the IDR 10 billion minimum per investor to be eligible for an Investor KITAS.

For clients aiming to secure an Investor KITAS, the immigration threshold remains a decisive factor in company structuring. 

What This Means for Foreign Investors 

BKPM Regulation No. 5 of 2025 reflects Indonesia’s long-term strategy: 

• Support business growth 

• Increase investment accessibility 

• Encourage transparent reporting and compliance 

Foreign investors can now allocate capital more flexibly while still meeting the government's investment targets. 

How SAS Bali Can Help 

At Smart Advisory Solutions, we ensure that your company remains fully compliant under the latest investment and immigration regulations. Our legal team can support you with: 

• Assessing your current paid-up capital alignment with the updated rules 

• Reviewing or preparing LKPM reports 

• Advising on optimal investment and shareholding structures for both BKPM and Immigration 

If you would like a compliance review or have questions about how this regulation affects your company, contact your Project Manager or email info@sasbali.com.