To invest in Indonesia, an investor should first look at a so-called ?Negative List of Investment? (Daftar Negative Investasi/DNI). The list (see chapter 6) contains those business sectors that are absolutely closed to all domestic as well as foreign investments, those closed to only foreign investments, those that are open to investment under condition of a joint venture between foreign and domestic capital and those that are open to investment under certain conditions.

Foreign direct investment (Penanaman Modal Asing/PMA) companies in Indonesia can be established in the form of 100% foreign ownership or a joint venture between foreign and Indonesian parties and should be incorporated as an Indonesian limited liability company (Perseroan Terbatas / PT) and domiciled in Indonesia.

Applications for investment under the Foreign Investment Law can be submitted to the Government of the Republic of Indonesia through one of the following offices:

1. The Investment Coordinating Board (BKPM). For foreign investment projects located in Bonded Zones, investors should submit the application to BKPM through the respective Bonded Zone Authority
2. The Regional Investment Coordinating Board (BKPMD) or
3. Indonesian missions and posts in various countries

The applications are then evaluated by these offices for their compliance with sectoral policies, finance etc. Clarifications, if any, would be sought from the investors.

Following the evaluation process, the Chairman of BKPM or Head of Corresponding Representative of the Government of the Republic of Indonesia or the Chairman of BKPMD concerned will issue the investment approval.

Upon the issuance of the investment approval, a foreign investment company can be legally established through the execution of the articles of incorporation in notary deed form.

A report in The Jakarta Post of 23rd December, 2003 cites a World Bank study which shows that it takes 196 days to set up a company in Indonesia.