Not by law, but it is usually wise: holding each project in its own company — a local PT or a foreign-owned PT PMA — keeps the accounts and security clean and ring-fences each project’s liabilities from your others. Capital providers take security over the project company, so a company holding several projects can make funding slow or impossible. Information only.
What is a single-purpose company?
A company that owns one project and nothing else. In Indonesia that is usually a PT (Perseroan Terbatas — a local limited company) or a PT PMA (Penanaman Modal Asing — a limited company with foreign shareholders). The company holds the land title or the lease, signs the construction contract and the sales contracts, and receives the buyer deposits.
Why does it matter to capital providers and buyers?
- Clean security. A capital provider takes security over the project company, its assets and its project account. If the company holds only one project, that security covers exactly that project.
- Clean accounts. Everything spent and received relates to one project, so the numbers can be checked quickly.
- Ring-fenced liabilities. A dispute, a delay or a debt on one project does not reach into another.
- Visibility for buyers. Off-plan buyers can see exactly what sits in the company they are paying.
If one company holds several projects, the capital provider takes on the risk of all of them, which makes due diligence slow and can make funding impossible. See security over HGB land and a PT PMA.
When is an existing company fine?
When it holds only the project in question — or the other activity is small, clean and easy to document. An operating business expanding to a second site, such as a hotel or clinic, may sensibly keep the expansion inside the existing company if that is where the licences and cash flow sit. The test is simple: can someone outside the business see clearly what the company owns, what it owes and what it is doing? If yes, a new company may not be needed. See opening a second location.
What about KBLI codes and foreign ownership?
Every Indonesian company is registered under KBLI codes — the business classification codes that say what it is allowed to do. The codes must match the project: a company set up to run a restaurant cannot simply start building and selling villas. Some activities are also closed or restricted for foreign-owned companies, which affects whether a PT PMA can hold a given project. Companies registered under older codes may need to update them before applying for permits.
See KBLI codes for Bali businesses and foreign business restrictions in 2026. Rules move: verify with Indonesian counsel.
Isn’t setting up a new company expensive and slow?
It costs money and takes weeks, and a PT PMA comes with minimum investment and paid-up capital requirements. Weigh that against the alternative: due diligence across several projects, security that is hard to take, and liabilities that can spread from one project to another. For most developments of the size a capital provider backs, the company is a small cost relative to the project. See what a PT PMA costs to set up. Information only.
Can I move a project into a new company later?
Sometimes, but it is easier to start clean. Transferring land rights, leases, permits and existing sales contracts into a new company takes legal work and the agreement of others — landowners, buyers, sometimes the authorities. If you are planning more than one project, set up the structure before you buy the next plot. This is general information, not legal advice: take advice from Indonesian counsel on your own structure.
Last reviewed October 2026. General information about the Indonesian market, not legal, tax or financial advice. Take advice from an Indonesian notary and legal counsel on any specific structure.
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