How Can I Start My Own Mini Business?

Corporate Secretary Service – There is a statistic, over a million Australians visit Bali annually, most of whom invest in the island. Four out of 10 foreigners looking to buy a villa in Bali are from Australia, showing Australian interest in doing business in Bali.

With the rapid pace of economic growth in Bali or Indonesia in recent years (and buying a house or setting up a company in Australia is no easy feat), many Australians are moving north to Bali and starting businesses there. Unfortunately, the proximity of the two islands does not equate to the perceived legal benefits or the leniency of the rules for foreign investment in Bali.

This article will cover some of the requirements you need to understand as an Australian starting a business in Bali: visa requirements, types of legal entities in Indonesia, local sponsors, shelf companies, and property rights. We also suggest ways to avoid scary scenarios, such as the closure of five Australian-owned restaurants due to fraud by their local partners.

Visa Requirements to Enter Bali

Australian visa requirements to enter Bali are less complex than they used to be, and this trend is expected to continue in light of negotiations between the Indonesian and Australian governments on “investment protection”. As a general rule of thumb when coming to Bali, Australian passports must be valid for at least six months with enough space for a visa stamp on the day of arrival. This rule is non-negotiable, and you cannot fly to Bali without a visa waiver.

Business Visa in Indonesia

Australians can obtain a 60-day single-entry business visa to visit Bali for purposes such as conducting market research or attending conferences. Multiple-entry business visas are also available and can even be applied for online. They are valid for up to 12 months, with each visit limited to a maximum of 60 days. Business visa holders are not permitted to work in Bali. If you want to work, a Temporary Residence Permit and a work permit are required unless you are a business owner.

Types of Companies in Bali for Australians

Several business entities are open to Australians in Bali if the terms and conditions are met. The most common company types Australians choose to start a business in Bali are foreign investment companies (PT PMA) and local companies (PT). Another type of business entity is a foreign representative office with the help of Corporate Secretary Service.

Read Also: Is Indonesia a Good Place to Start a Business?

PT PMA

It is the type of business entity that foreigners can own. The percentage of companies that Australians can own depends on the sectors listed in the Negative Investment List (Daftar Negatif Investasi – DNI). PT PMA companies are notorious for their time-consuming document preparation and establishment. Therefore, it is recommended that you get the help of an agency or consultant who specializes in PT PMA formation.

The advantages of a PT PMA include the ability to sponsor Limited Stay Permit or ITAS (Izin Tinggal Terbatas) and RPTKA (Rencana Penggunaan Tenaga Kerja Asing) authorizations for Australians. PT PMA can also employ other foreigners if they have the qualifications for specific licenses. On the other hand, the disadvantages of PT PMA have been discussed earlier – the establishment process is complex, time-consuming, and expensive. The DNI determines the percentage of ownership, which can also change over time.

Local PT

A local PT is a limited liability company wholly owned by Indonesian residents. It is the least complicated type of business entity to set up in Bali. However, for Australians, establishing a local PT is only possible if they find a special-purpose vehicle and sign a special-purpose agreement. A local PT is a relatively inexpensive, stress-free option and a straightforward business entity to set up. However, small local companies cannot employ foreigners and cannot issue work permits.

Foreign or Locally Owned Company: Choose the Legal Entity

In short, a local company is the best option when starting a company in Bali as a sole proprietorship. This is especially true for Australian residents who want to buy and rent out villas, open restaurants and bars in Ubud, or start a family business in Bali. On the other hand, a foreign-owned company is an excellent choice for those who plan to build or expand a corporation and do not want to share ownership with a Corporate Secretary Service in Bali.

Don’t worry about developing your business by setting up a company in Indonesia, because Portcorp is here as a solution for your business. Portcorp is your comprehensive corporate secretary service in Indonesia. With our presence, you can get a dedicated company secretary to support you to what you need. Our company secretaries will track deadlines and file paperwork so your business keeps running smoothly. Contact us now for your business success in the future!