On October 2, 2025, the Ministry of Investment (BKPM) officially issued Regulation No. 5 of 2025 (BKPM Reg. 5/2025), marking a significant milestone in Indonesia’s investment system. This new regulation, therefore, introduces major adjustments to the Online Single Submission (OSS) mechanism and sets new provisions for foreign investment companies (PT PMA).
In this article, we will briefly yet comprehensively explain the key changes in the regulation, the reasons behind them, and their implications for foreign investors and business players in Indonesia.
Major Changes Introduced by BKPM Regulation No. 5
Previously, foreign companies were required to deposit a minimum paid-up capital of Rp10 billion for each business activity (KBLI). However, under the new regulation, BKPM reduces this requirement to Rp2.5 billion per KBLI. As a result, this adjustment encourages easier and more inclusive foreign investment in Indonesia.
Key Highlights:
- Companies must deposit at least Rp2.5 billion into their own account and maintain it for 12 months, except when used for working capital or investment expenses.
- The remaining Rp7.5 billion may consist of eligible tangible or intangible assets, such as machinery, vehicles, production equipment, or feasibility study and construction costs.
- Businesses operating in multiple KBLI categories, such as F&B, manufacturing, or wholesale trade, can now combine them in a single investment plan, without separate capital calculations.
- In sectors like property, agriculture, and fisheries, land and building values are now recognized as part of total investment.
Furthermore, BKPM updated the OSS system starting October 5, 2025, to ensure these changes are automatically integrated. Consequently, licensing processes become faster, administrative barriers are reduced, and transparency for investors significantly improves.
Why This Change Matters
For years, many entrepreneurs have argued that the Rp10 billion capital requirement was a major barrier, especially for medium-sized businesses, startups, and service sectors. They often had innovative business ideas but struggled to meet the high initial capital.
Through Regulation No. 5, the government seeks to create a more realistic and inclusive investment climate. In other words, it ensures that more businesses can enter the market legally and competitively.
The Importance of This Policy
- Lower entry barriers → New investors can start businesses with lighter capital, yet remain fully compliant.
- Higher capital efficiency → Companies can now allocate more funds toward productive assets rather than idle cash.
- Improved competitiveness → Indonesia is now on par with other ASEAN countries in terms of investment ease.
Ultimately, this regulation is not just about numbers. Above all, it focuses on promoting productive investments and supporting long-term economic growth.
Immediate Impacts for Investors and Businesses
The changes introduced by BKPM Reg. 5/2025 bring several practical benefits, both for new and existing foreign companies. For instance, they open wider opportunities for investors seeking flexibility and operational efficiency.
- Easier access for small and medium-scale investors → Businesses with holding structures in Singapore or light business models can now operate legally in Indonesia with a lower entry cost.
- Optimized capital structure → Existing PT PMAs can reassess their capital composition and adjust business licenses to comply with current rules.
- Greater flexibility in project integration → Investors in property, agribusiness, renewable energy, or manufacturing may now consolidate multiple projects into one investment plan.
- Faster licensing through OSS → The upgraded OSS system provides a more transparent, efficient, and risk-based approval process.
Consequently, investors can now operate more strategically, without unnecessary administrative delays.
Strategic Steps for Investors
With the enforcement of BKPM Reg. 5/2025, every investor should reassess their company structure and capital allocation. To adapt smoothly, consider taking these strategic steps:
- Update your OSS data and licenses according to the new regulation.
- Reevaluate your capital structure, including assets now recognized as part of investment value.
- Consult legal or investment experts to ensure your strategy aligns with the latest regulatory standards.
By doing so, your business will remain both competitive and compliant under the new investment framework.
In conclusion, BKPM Regulation No. 5 of 2025 represents a major step forward in Indonesia’s investment reform. Therefore, by reducing capital barriers and improving OSS efficiency, the government enhances financial flexibility and strengthens Indonesia’s global investment appeal. To sum up, this regulation opens vast opportunities for both foreign and local investors to expand their businesses. However, adapting to new legal frameworks requires professional guidance to ensure your investment remains secure.
Invest Safely with Professional Legal Assistance
At the end of the day, Regulation No. 5/2025 makes it easier for foreign investors to enter Indonesia. Yet, each opportunity still requires careful legal planning to protect your investment and comply with government policies.
When your capital exceeds Rp10 billion, the focus should no longer be on “how much it costs to establish a PT PMA,” but rather “how to safeguard your investment from the start.” Using professional legal services means investing in long-term protection, not just additional expenses.
Kontrak Hukum understands the importance of precision and compliance in the PT PMA establishment process. Therefore, our team assists you end-to-end—from company planning and deed drafting to OSS licensing and BKPM reporting. For a personalized cost estimate, schedule a consultation session with our legal experts today. Starting from just Rp490,000, you can get tailored guidance to protect your investment effectively.
Contact us now via Tanya KH or send a direct message to our Instagram @kontrakhukum.
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