Questions about requesting IMB PMA and Melati hotel licence

[heerhugo]

Hi everybody,

Still busy with my plans, and i want to start a new post, my old post is here:

Pondok Wisata licence for a guesthouse

Hi, Iám reading the forum for a long while, but this will be my first post. Iám planning to open a guesthouse or rent a villa to tourists. I know that there are enough illegal villa's for rent. I want to rent it on the 'legal' way. To my knowledge i need a pondok wisata licence ( Guesthouse...

balipod.com

I'll explain my situation:

I want to build a small resort in the Sanur area.

I rented a piece of land with a landcertificate, contract have to be signed in januari.
I need to request a IMB.
I need to request a melati license.
I need to startup a PMA for supplying a kitas for me.

When i want to startup a PMA i need an IMB.

I want to do the following:
Because my friend has good influence in Sanur, i want that he request the IMB and Melati hotel license for me.
After that i can setup a PMA with the IMB and melati hotel license.

Is this possible?

Also is it a problem that the lease contract is on my name?

Or should the lease contract be first in the name of my friend and afterwards i rent it all (land,imb,melati) from him?
Should it be done again by the notary? (thinking about the taxes again then...)

And yes i know, you should go to a lawyer for this kind of questions, and i did but everybody as usual are advising different options..... so i like to hear your opinions...

Everybody thanks again.

Greetings,

Hugo

 

[spicyayam]

My very unqualified opinion is to keep it in your name since you have already leased the land in your name. Your friend will still be of assistance to get your IMB, but I think you keep doing it in your name.

I am unsure about the business structure you would need for a small hotel. I wonder if you really need a PMA? A PMA is good that you can buy the land in the company's name, but you have already said that you are leasing it.

I would suggest trying to find out from other foreign hotel owners how they set up their operations. I know of people you could speak to in Lovina but not Sanur.

 

[heerhugo]

Thanks for your reply.

I'am only setting up the PMA to supply a kitas for me so i can work in my own business.
If i use another company to sponsor me for a kitas, i'am afraid of the problem that the sponsor adress is different of the adress of my resort, if you know what i mean.

For a resort i don't have to setup a pma, but i need a 'legal' kitas.
I can aslo setup a PT, but whith that little difference i'll go for a PMA.
CV is very difficult right now, because of changing the rules from 2011 for sponsoring foreign workers.

 

[T.J]

I have just completed setting up our PT Company which has supplied us with business visas. The only problem with business visas is that they only last for 3 months and then can be extended to 6 months before having to do the "visa run". We can work and earn money within Bali from our company and we just report tax (yeah.... as if). With Kitas you must pay some tax upfront ($1200 USD) every year. To complete our PT Company we needed an IMB for our place of business which happens to be a local freinds house. The problem arised that he did not have an IMB and the developer has vanished. We paid our agent 5.5juta for an IMB to magically appear from the bank. I guess there is no perfect business structure but the PMA was just too expensive for a family of 6 to be involved with............:icon_wink:

 

[heerhugo]

Hi TJ,

Can you tell me in which point of the progress you need to supply the IMB?
Mayby i can startup the PMA and IMB at the same time...and supply the IMB at the moment it is needed for the setup of the PMA.

thanks

 

[T.J]

Hi TJ,

Can you tell me in which point of the progress you need to supply the IMB?
Mayby i can startup the PMA and IMB at the same time...and supply the IMB at the moment it is needed for the setup of the PMA.

thanks

The company was set up, named and registered with only the final location left blank. To arrange any visa or kita's from the company we had to have the IMB. The setting up of the companies seems to be a little LOOSE. You can register a name, get operational permits for different areas of the business (eg Sales/advertising/developing etc) and just fill in the rest of the blanks as you go along.
While it could be done a lot cheaper on your own with local help, invest in a reliable agent, we all want to try and reduce stress hence our love of Bali.

 

[Mickey]

Hi Hugo,
I have been following your posts for the last 2 weeks and it feels like i m watching Jail Break.
i m really happy for you and that you came so far with your plans and seeing them developing starting in 2009 with the idea of the guest house till your last post with the PMA/Land/Resort and IMB.
you have inspired me in a way ! *op een dag zal het zijn vruchten afwerpen *
and also a lot of thanks to spicyayam, matsaleh, Ronb and all the others that have contributed to this post with their valuable comments and advices.

If i can make a conclusion:
To start a small resort (8 rooms) business in Bali you need to apply for a PMA.
with the PMA you can :
-Get a KITAS.
-Rent or buy a property (Land/Villa)
My questions:
1/ Are you allowed as a Direct Foreign Investor to 100% own your PMA for this line of business? If not what is the max percentage that you can own?
2/ can you please explain step by step how to get the license for the PMA, costs involved and time?

Thanks in Advance for your valuable answers,
Mickey

 

[gilbert de jong]

@ hugo...just hoping your land is comercial zoned?

 

[Mickey]

Steps to get the PMA licence

Hi All,

Gilbert, thanks for the remark on the zoning. any idea how to check that in advance?

Great new, i have found the steps that you need to follow to obtain a PMA license, see link:
http://www.kadin-indonesia.or.id/en/doc/Invest_Foreign_Investment_Law.pdf

i m still searching for the costs involved, i have found something but i don't know if it's credible. Total costs are (+/- 5,256.816 IDR), see link:
Doing Business in Indonesia - World Bank Group

well that's it for now, i will keep you posted.

P.S: if anybody has experience with dealing with a contractor and can share some valuable info, it will be appreciated.

Thanks in Advance

Regards,
Mickey

 

[T.J]

PMA Information from my agent

Heres some info about PMA's from my agent;

PMA Indonesian Foreign Owned Company - This Indonesian company formation can be registered in the name
of a non Indonesian citizen and offers the foreign national direct ownership and director title. The PMA company is a
limited liability company and offers limited liability protection for foreign national director. The PMA company awards
full ownership, full business rights and full asset ownership directly to and in the name of the foreign national director.

Main Pros & Cons: PMA Indonesian Foreign Owned Company - $6,500.00 ($6,000.00 if prepaid)
This fully foreign owned company formation offers limited liability for the director/s. A PMA can sponsor six foreign
nationals to work and conduct business on behalf of the PMA company and within permitted company authorizations.
PMA sponsored foreign nationals can enjoy immigration Indonesia work and resident privileges in Bali and Indonesia.
The PMA company owners, investors, directors and any sponsored foreign nationals can obtain kitas or working visa
issued directly from the foreign owned company. Depending on certain criteria and activity kitas visas can be avoided.
Time needed for fully complete PMA Indonesian foreign held company formation is fourteen weeks. However we can
commence proceedings and complete the PMA company formation before the foreign investor/s even arrive in Bali or
Indonesia for final signing of contracts. Full and total payable charges for a foreign held and controlled PMA company
are US$6,500.00. Our PMA foreign owned company formations are large (full scale) and fully registered in both Bali,
Jakarta and able to operate Indonesia wide. The approved and permitted Bali business activities are limited and defined.

NOTE: Due to new government Indonesia regulations as of July 2007 some defined PMA (foreign owned) companies
now must partner with an Indonesian national who must hold a share in the company stocks. We however use a legal
name-only partner to enable full compliance and still ensure total control & protection for the foreign national client.
Some defined PMA business activities have not been effected by the new government regulations. We can still produce
a 100% fully foreign owned PMA company for certain defined business operations. A PMA company seeking rights to
conduct Import/Export orientated business activities can still be fully 100% foreign owned without additional contract.

 

[heerhugo]

@ hugo...just hoping your land is comercial zoned?

Hi Gilbert,

Yes the area isn't a problem. There are many guesthouse and hotels.
In the same street where my property is are already many hotels and resorts.
So i think there will be no problem.

 

[Mickey]

Too Expensive !!!

thanks T.J

As you see from my previous POST I m more looking for establishing the PMA on my own and not using an agent.
This way man can familiarise himself with the bureaucracy and the paper work for his own company.
This way man can start building a valuable network that can support him in the future.

Concerning the fees from your agent, these are too high and above standard.
Here are the prices that I found based on 10 months research:

If you take the procedure on your own: 600$
Using an agent: minimum is 1800$ and maximum is 3500$. Including all the paper work from A to Z.

No offence here, but I think your agent is too expensive.

Regards,
Mickey

 

[heerhugo]

Hi Hugo,
I have been following your posts for the last 2 weeks and it feels like i m watching Jail Break.
i m really happy for you and that you came so far with your plans and seeing them developing starting in 2009 with the idea of the guest house till your last post with the PMA/Land/Resort and IMB.
you have inspired me in a way ! *op een dag zal het zijn vruchten afwerpen *
and also a lot of thanks to spicyayam, matsaleh, Ronb and all the others that have contributed to this post with their valuable comments and advices.

If i can make a conclusion:
To start a small resort (8 rooms) business in Bali you need to apply for a PMA.
with the PMA you can :
-Get a KITAS.
-Rent or buy a property (Land/Villa)
My questions:
1/ Are you allowed as a Direct Foreign Investor to 100% own your PMA for this line of business? If not what is the max percentage that you can own?
2/ can you please explain step by step how to get the license for the PMA, costs involved and time?

Thanks in Advance for your valuable answers,
Mickey

1/ You need a indonesian shareholder for 51%, after the PMA has been setup you make an agreement by the notary that the shareholder has no rights. So it will be 100% your company.
2/ total costs for the PMA 3200usd, kitas costs 865usd + manpower 1200usd

you need 2 foreigner names + 1 indonesian name + IMB for the office adress

setup goes like this:

week 1 payment of 1500usd PMA
week 6 payment of 1700usd PMA
week 7 payment of 865usd kitas
week 8 PMA is ready
week 10 payment of 1200usd manpower
week 10 kitas is ready

whole process 10 weeks including your kitas

 

[spicyayam]

Good luck Mickey, I hope you are a patient person. I don't want to discourage you but I think you will have a tough time doing it by yourself, unless you have at least some contacts in the government.

 

[heerhugo]

thanks T.J

As you see from my previous POST I m more looking for establishing the PMA on my own and not using an agent.
This way man can familiarise himself with the bureaucracy and the paper work for his own company.
This way man can start building a valuable network that can support him in the future.

Concerning the fees from your agent, these are too high and above standard.
Here are the prices that I found based on 10 months research:

If you take the procedure on your own: 600$
Using an agent: minimum is 1800$ and maximum is 3500$. Including all the paper work from A to Z.

No offence here, but I think your agent is too expensive.

Regards,
Mickey

i understand that doing it yourself is a lot cheaper.
it is just the choice you make, want to do business and don't want to hassle with the paperwork use an agent.
if you have the time and the stress do it yourself.
i like to do business so i will use an agent and use my energy for doing business.

 

[spicyayam]

1/ Are you allowed as a Direct Foreign Investor to 100% own your PMA for this line of business? If not what is the max percentage that you can own?

I believe this depends on the industry of the business. You can find more details on the BKPM website, particularly the Negative Investment List which tells you what you can and can't invest in and percentage levels of foreign ownership.

 

[T.J]

thanks T.J

As you see from my previous POST I m more looking for establishing the PMA on my own and not using an agent.
This way man can familiarise himself with the bureaucracy and the paper work for his own company.
This way man can start building a valuable network that can support him in the future.

Concerning the fees from your agent, these are too high and above standard.
Here are the prices that I found based on 10 months research:

If you take the procedure on your own: 600$
Using an agent: minimum is 1800$ and maximum is 3500$. Including all the paper work from A to Z.

No offence here, but I think your agent is too expensive.

Regards,
Mickey

I understand where your coming from Mickey. If you dont understand the entire business then it can be hard to keep everything in check.
Regarding the prices in the quoted text, these were the initial prices given to us before negotiations. Also the particular agent I am dealing with becomes more of a lifetime business adviser/lawyer/promoter after the initial setup which worked for us until we get a more in depth understanding of the corruption...........I mean government policies within Indonesia.:icon_e_confused:
Best of luck and keep us posted

 

[sakumabali]

A foreigner could own a "consulting" PMA by 100 % in his name, some other businesses / PMA combinations may vary up to that 51 % - 49 % scenario mentionned before....

 

[gilbert de jong]

Hi Gilbert,

Yes the area isn't a problem. There are many guesthouse and hotels.
In the same street where my property is are already many hotels and resorts.
So i think there will be no problem.

alrighty hugo. make sure that the paperwork wich pertains to the 'use of land' there's also written commercial use i.e hotel/guesthouse or something like that.
Hope everything will work out fine for you, I am not so knowledgeable about the pma, so I can't 'help' you there..
I do know that there are also 'dorment' PMA's for sale (by such companies as you and others mentioned), maybe that's something worth checking out...as in taking over the existing PMA and then have land/licenses/etcetc..all under your own control, without contracts to third parties.
friendly greetings, gilbert.

 

[heerhugo]

alrighty hugo. make sure that the paperwork wich pertains to the 'use of land' there's also written commercial use i.e hotel/guesthouse or something like that.
Hope everything will work out fine for you, I am not so knowledgeable about the pma, so I can't 'help' you there..
I do know that there are also 'dorment' PMA's for sale (by such companies as you and others mentioned), maybe that's something worth checking out...as in taking over the existing PMA and then have land/licenses/etcetc..all under your own control, without contracts to third parties.
friendly greetings, gilbert.

little update:

I was at Okusi and they advised me to check my zoning. If you have a copy of the landcertificate and PBB (Tax) they can check at the government office called ITR what the zoning of my land is.
I saw an example, it's a map with your location so you can check your zoning. Costs just 150.000rp so worth to check out. I will let you know..