Law No. 25 of 2007 on Investment
Undang-Undang Nomor 25 Tahun 2007 tentang Penanaman Modal
What this regulation does
Plain-English summary of the regulation's substance and how it affects PT PMA operations.
UU 25/2007, the Investment Law, is the foundational statute governing both foreign (PMA) and domestic (PMDN) investment in Indonesia. It establishes BKPM as the lead investment authority, defines the Indonesian limited-liability vehicle (PT) as the only allowed legal form for direct investment, and sets out the rights and obligations of investors. Key principles include: equal treatment of foreign and domestic investors except where law expressly provides otherwise (Article 6); investor rights to repatriate profits, capital, and assets in foreign currency (Article 8); and the right to obtain land titles, foreign-worker permits, and tax facilities under separate implementing regulations. Article 12 provides that investment business fields are open unless explicitly closed or conditioned by Presidential Regulation — the legal hook for Pres. Reg. 10/2021 (BUPM). Substantially amended by UU 11/2020 (Cipta Kerja / Job Creation Law) which streamlined licensing into the OSS-RBA system. Together with the Job Creation Law, this is the constitutional-tier reference cited in any Indonesian investment dispute.
Key provisions
The articles and operational points most commonly referenced in practice.
- 01
Article 6 — Equal treatment
Foreign and domestic investors receive equal treatment under Indonesian law except where expressly provided otherwise.
- 02
Article 8 — Repatriation rights
Investors may repatriate profits, capital, and assets in foreign currency, subject to Bank Indonesia foreign-exchange reporting.
- 03
Article 12 — Open business fields
Business fields are open to investment unless explicitly closed or conditioned by Presidential Regulation — the basis for the BUPM list.
- 04
Investment vehicle
Direct investment must be through a PT (limited-liability company) — foreign-owned PT becomes a PT PMA.
Official text
For compliance and dispute work, cite the original Indonesian text directly.
Undang-Undang Nomor 25 Tahun 2007 tentang Penanaman Modal
tentang Penanaman Modal
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