Understanding Company Management Structure
Indonesian company law requires every PT (Perseroan Terbatas), including PT PMA, to have a clear management structure with two distinct bodies:
Directors (Direksi)
Executive management responsible for day-to-day operations and legal representation of the company.
Commissioners (Dewan Komisaris)
Supervisory board that oversees directors and provides strategic guidance to the company.
Director Requirements
| Requirement | Rule |
|---|---|
| Minimum Number | 1 Director required |
| Nationality | Foreigner allowed |
| Residency | Must reside in Indonesia |
| Age | 21+ years old |
| Criminal Record | Clean record required |
Key point: At least one director must have Indonesian domicile (residence). Foreign directors must obtain a KITAS work permit to fulfill this requirement.
Commissioner Requirements
| Requirement | Rule |
|---|---|
| Minimum Number | 1 Commissioner required |
| Nationality | Foreigner allowed |
| Residency | Not required to reside |
| Dual Role | Not allowed |
Director vs Commissioner Comparison
| Aspect | Director | Commissioner |
|---|---|---|
| Role | Day-to-day management & operations | Supervision & oversight of directors |
| Power | Signs contracts, makes decisions, legal representation | Advisory role, no executive power |
| Residency | At least one must live in Indonesia | Can be based overseas |
| Liability | Personal liability for management decisions | Limited to supervisory negligence |
| KITAS | Required for foreigners working in Indonesia | Not required if not working in Indonesia |
Foreign Nationals as Directors
Foreign nationals can serve as directors in PT PMA companies. However, they must meet certain requirements:
- Obtain KITAS (Limited Stay Permit) - typically KITAS 312 for work or 313 for investor
- Have the company sponsor their work permit (IMTA/RPTKA)
- Establish Indonesian domicile address
- Meet minimum age requirement (21 years)
- Have clean criminal record (no financial crimes in past 5 years)
Important: A foreign director with KITAS must physically reside in Indonesia and is subject to Indonesian tax on worldwide income after becoming a tax resident.
Frequently Asked Questions
Yes, a foreigner can be the sole director of a PT PMA. However, that director must obtain a KITAS (limited stay permit) and establish Indonesian domicile. They will be responsible for day-to-day management and legal representation of the company.
Yes, Indonesian law requires every PT (including PT PMA) to have at least one director and one commissioner. These must be different people - the same person cannot hold both positions simultaneously.
Yes, shareholders can also serve as directors or commissioners. This is common in smaller PT PMA companies where the foreign investor is both a shareholder and the director, with the commissioner being a separate person.
No, commissioners are not required to reside in Indonesia. They have an oversight/supervisory role and do not need a KITAS or Indonesian domicile. This makes it possible for overseas investors to serve as commissioners.
A foreign director typically needs a KITAS 312 (work visa sponsored by the PT PMA) or KITAS 313 (investor visa). The company must sponsor the director's work permit (IMTA/RPTKA) as part of the KITAS application process.
While technically possible to appoint an Indonesian as director, be cautious about true "nominee" arrangements. The director has legal authority and personal liability. Any nominee arrangement should have proper legal agreements and understanding of the risks involved.
Directors are personally liable for company management decisions. They must act in the company's best interest, avoid conflicts of interest, maintain proper records, file required reports, and can be held personally liable for negligence or misconduct.