The Ministry of Investment/BKPM has issued Regulation No. 5 of 2025 on Guidelines for Risk-Based Business Licensing (“BKPM Regulation 5/2025”), as the organic implementing regulation of the new Government Regulation No. 28 of 2025 on Risk-Based Business Licensing (“GR 28/2025”).

This regulation not only provides more relaxed and flexible investment facilities, but now also enveloped a sectoral and scattered investment facilities into one, in this regulation.

What’s New?

1.Minimum Issued and Paid-up Capital Requirement: The minimum issued and paid-up capital for foreign investment companies (PMA Company) has been reduced to IDR 2.5 billion per company from the previous IDR 10 billion, reinstating the pre-2021 foreign capitalization regime.

2.Foreign Investment Value Criteria: PMA Company engaged in property, accommodation, agriculture, plantation, livestock, and aquaculture may include land and buildings to fulfil the minimum foreign investment capital requirement.

3.Shared Building Permits: Businesses in shared buildings or complexes may use the building owner’s existing location, environmental, and building permits for OSS-based licensing.

How Beneficial?

BKPM Regulation 5/2025 aims to attract more foreign investment by providing more relaxed and consolidated investment facilities, while enhancing Indonesia’s investment climate through lower capital barriers and streamlined licensing procedures.