Foreign Business Setup Guide
How to Start an Advertising Agency in Surabaya as an American Foreigner
Everything you need to know about licenses, company setup, and compliance requirements for American entrepreneurs opening a advertising agency in Surabaya, Indonesia.
Licenses Required
2
Est. Cost Range
$58 - $290
Timeline
8-43 days
Quick Answer
Yes, American foreigners can start a advertising agency in Surabaya, Indonesia. This business activity is open to foreign investment with up to 49% foreign ownership through a PT PMA (foreign-owned limited liability company).
You will need approximately 2 licenses and can expect the process to take 8-43 business days. The estimated government and service fees range from Rp 900.000 to Rp 4.500.000.
Foreign Ownership Rules
Foreign Ownership
Up to 49%
DNIB Status
conditional
Recommended Structure
PT PMA (Foreign Investment Company) (PT PMA)
As a foreign investor opening a advertising agency in Indonesia, you will typically establish a PT PMA (Perseroan Terbatas Penanaman Modal Asing) — a foreign-owned limited liability company. This is the standard legal entity for foreigners conducting business activities in Indonesia.
Minimum investment capital: Rp 10.000.000.000 ($645,161).
Surabaya — Local Compliance Guidance
Specific regulations, costs, and timelines that apply to businesses setting up in Surabaya.
Cost Adjustment
10% lower
Costs in Surabaya are approximately 10% lower than the national average due to local market conditions and regulatory requirements.
About Surabaya
Surabaya as East Java's capital offers streamlined processing. The local investment office is proactive with foreign investors. Lower operational costs than Jakarta or Bali. Surabaya has Indonesia's second-largest port, making it ideal for import/export businesses. The local DPMPTSP is known for relatively efficient processing.
Additional Local Requirements
These permits and requirements apply specifically in Surabaya, in addition to national requirements.
- East Java Provincial Business Registration
Restrictions & Warnings
Industrial zone businesses require Surabaya Environmental Agency clearance
Certain areas near military installations have restricted business activities
Local Investment Authority
Authority Name
DPMPTSP Kota Surabaya
Contact
dpmptsp@surabaya.go.id
The local DPMPTSP (Investment and One Stop Integrated Service) office handles regional permits alongside the national OSS system.
Required KBLI Codes
KBLI (Klasifikasi Baku Lapangan Usaha Indonesia) codes identify your business activities in Indonesia's licensing system.
| Code | Risk Level | Foreign Ownership | DNIB Status |
|---|---|---|---|
| 73100 | medium | 49% | conditional |
Required Licenses & Permits
Licenses required to operate a advertising agency in Surabaya as a foreign-owned business.
Nomor Induk Berusaha(NIB)
business_id
▾
Nomor Induk Berusaha(NIB)
business_id
Estimated Cost
Free
Free through OSS system
Processing Time
1 business days
Validity
Varies
Izin Lokasi (Location Permit)
location
▾
Izin Lokasi (Location Permit)
location
Estimated Cost
Rp 1.000.000 - Rp 5.000.000
Varies by municipality, free for small plots under 25m2
Processing Time
14 business days
Validity
36 months (renewable)
Get Your Free Compliance Checklist
Tailored to your specific business type, location, and nationality.
Step-by-Step Setup Process
The typical process for a American entrepreneur setting up a advertising agency in Surabaya (10 steps).
Prepare Documentation
~7 daysGather your passport, proof of address, and any relevant business qualifications. Foreign citizens should also prepare apostilled documents if required.
Reserve Your Company Name
~3 daysSubmit 3 company name choices to the Ministry of Law and Human Rights (Kemenkumham) through the AHU Online system. Names must be in Bahasa Indonesia and at least 3 words.
Draft the Deed of Establishment
~7 daysWork with a local notary to prepare your company articles of association, including share structure and business activities (KBLI codes).
Register with Kemenkumham
~14 daysSubmit the notarial deed for legal entity approval. Once approved, your company exists as a legal entity.
Obtain NIB through OSS
~1 dayRegister on the OSS (Online Single Submission) system to get your NIB (Nomor Induk Berusaha) - your primary business identification number. Select the appropriate KBLI codes for your business activities.
Apply for Sector-Specific Licenses
~14 daysBased on your KBLI codes and risk level, apply for any additional permits required to operate your business type in your chosen location.
Pro tip: License requirements vary significantly by business type and risk level. Low-risk businesses may only need NIB, while high-risk businesses need multiple sector permits.
Open a Corporate Bank Account
~14 daysOpen an Indonesian bank account in the company name and deposit the required paid-up capital (minimum IDR 2.5 billion for PT PMA).
Register for Tax (NPWP & PKP)
~7 daysObtain your company Tax ID (NPWP) and register as a taxable entrepreneur (PKP) if your revenue will exceed the IDR 4.8 billion threshold.
Apply for Work Permits (RPTKA & IMTA)
~30 daysApply for the Foreign Worker Utilization Plan (RPTKA) and work permit (IMTA) through the Ministry of Manpower.
Obtain KITAS/KITAP Visa
~15 daysApply for your stay permit (KITAS for temporary, KITAP for permanent) through immigration. This allows you to legally reside and work in Indonesia.
Estimated Total Timeline
112 days(4 months)
Based on mandatory steps processed sequentially. Actual timeline may vary depending on government processing speeds and document readiness. Some steps can run in parallel.
Estimated Costs Breakdown — Surabaya
Approximate government and service fees adjusted for Surabaya (10% below national average). Excludes ongoing operational costs.
| Item | Low Estimate (IDR) | High Estimate (IDR) | USD Approx. |
|---|---|---|---|
| Company Establishment (Notary + Legal) | Rp 13.500.000 | Rp 31.500.000 | $871 - $2,032 |
| Kemenkumham Registration | Rp 900.000 | Rp 1.800.000 | $58 - $116 |
| NIB / OSS Registration(Free (government)) | Free | Free | Free |
| Nomor Induk Berusaha (NIB)(Free through OSS system) | Free | Free | Free |
| Izin Lokasi (Location Permit)(Varies by municipality, free for small plots under 25m2) | Rp 900.000 | Rp 4.500.000 | $58 - $290 |
| Work Permit (RPTKA + IMTA) | Rp 13.500.000 | Rp 22.500.000 | $871 - $1,452 |
| KITAS Visa | Rp 4.500.000 | Rp 10.800.000 | $290 - $697 |
| Virtual / Physical Office Address(Per year) | Rp 4.500.000 | Rp 27.000.000 | $290 - $1,742 |
| Total Estimated Range | Rp 37.800.000 | Rp 98.100.000 | $2,439 - $6,329 |
Note: Minimum investment capital for a PT PMA is Rp 10.000.000.000 ($645,161). This is separate from the setup costs above.
Visa & Work Permit Requirements
As a Americannational, you'll need the right visa to live and work in Indonesia while running your advertising agency.
Recommended: Investor
KITAS Investor
- Duration: 24 months
- Estimated cost: $1,500
- Company sponsorship required
Alternative: Work Permit
KITAS Investor
- Duration: 24 months
- Min. salary: $1,200/month minimum
- RPTKA approval needed first
American citizens can enter Indonesia visa-free for up to 30 days or on a Visa on Arrival (VoA) for tourism. However, to work and operate a business, you must obtain the appropriate stay permit (KITAS/KITAP).
Guidance for American Entrepreneurs
Country-specific information for American nationals setting up a business in Indonesia.
Recommended Visa Pathway
Investor KITAS recommended for business owners. B211A for initial setup phase (60 days, extendable). RPTKA required before KITAS.
Estimated processing time: 35 business days
Tax Treaty Information
Indonesia-US Tax Treaty (P3B) is in effect. US citizens are taxed on worldwide income. FATCA reporting requirements apply. Consult a cross-border tax advisor.
Common Issues for American Nationals
FATCA compliance adds reporting burden
US passport holders cannot renounce tax obligations easily
Indonesian banks may request W-9 forms
Social Security Totalization Agreement does NOT exist with Indonesia
Document Requirements for American Citizens
- Documents must be apostilled (Hague Convention)
- Criminal background check from FBI required for KITAS
- University degrees must be verified by WES or similar
Embassy & Consulate
US Embassy Jakarta: Jl. Medan Merdeka Selatan No.3-5, Jakarta 10110. US Consulate General Surabaya: Jl. Citra Raya Niaga No. 2, Surabaya 60217. Commercial Service available for business inquiries.
Business Culture Tips
Business meetings in Indonesia start with small talk. Exchanging business cards with both hands is expected. Avoid scheduling meetings during Friday prayer (11:30-13:00).
Common Pitfalls & Tips
Operating on a Tourist Visa
Many foreigners try to start a business while on a tourist visa or VoA. This is illegal and can result in deportation and blacklisting. Always obtain proper business documentation first.
Using Nominee Structures Illegally
While nominee arrangements are common, undisclosed nominee structures violate Indonesian law. If foreign ownership is restricted, work with a qualified lawyer to find compliant alternatives.
Underestimating Capital Requirements
PT PMA companies have minimum investment and paid-up capital requirements. Ensure you meet these thresholds before starting the registration process for your advertising agency.
Ignoring Local Permits
Surabaya may have specific local permits (izin usaha) beyond national requirements. Check with the local DPMPTSP (investment office) for Surabaya-specific requirements.
Missing Tax Obligations
Indonesia has strict tax reporting requirements including monthly VAT returns, employee tax withholding (PPh 21), and annual corporate income tax. Non-compliance leads to significant penalties.
Frequently Asked Questions
Can a American citizen own 100% of a advertising agency in Surabaya?
▾
American nationals can own up to 49% of a advertising agency in Surabaya. The remaining 51% must be held by an Indonesian shareholder. This applies to all 1 KBLI code for this business type.
What licenses do I need to start a advertising agency in Surabaya?
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You will need 2 licenses to operate a advertising agency in Surabaya. These include: NIB, Izin Lokasi (Location Permit). All licenses are obtained through Indonesia's OSS (Online Single Submission) system and sector-specific authorities.
How much does it cost to set up a advertising agency in Surabaya?
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Based on the 2 required licenses, government and service fees for a advertising agency in Surabaya range from Rp 900.000 to Rp 4.500.000 (approximately $58 to $290). This excludes the minimum investment capital of Rp 10 billion required for PT PMA companies, office rental, and ongoing operational costs.
How long does it take to set up a advertising agency in Surabaya?
▾
The typical timeline is 8-43 business days from start to fully operational in Surabaya. This includes company registration, obtaining all 2 required licenses, and visa processing. Working with an experienced agent can help run some steps in parallel and reduce the total time.
Do I need a local partner to start a advertising agency in Indonesia?
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Yes, a local partner is required for 1 of your 1 KBLI code which limit foreign ownership to 49%. The Indonesian shareholder must hold at least 51% of shares for those activities. Ensure you work with a reputable local partner and have a proper shareholder agreement drafted by a qualified lawyer.
What visa do I need as an American to run a business in Indonesia?
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You will need either an Investor KITAS (stay permit) or a Work KITAS, sponsored by your Indonesian company. Tourist visas and Visa on Arrival do not permit business activities. The Investor KITAS is typically recommended for business owners, while the Work KITAS is for employees of the company.
Can I operate my advertising agency from Surabaya remotely?
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Your PT PMA must have a registered physical or virtual office address in Surabaya. You can manage operations remotely as long as you maintain compliance with tax and reporting obligations, including monthly VAT returns and quarterly LKPM (investment activity reports). Directors must attend certain regulatory meetings in person.
What are the ongoing compliance requirements?
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You must file monthly tax returns (VAT, employee tax), submit an annual corporate tax return, renew applicable licenses (you have 2 to track), maintain LKPM (investment activity reports) quarterly, and keep company records with your notary. Non-compliance can result in license revocation and penalties.
Data verified against official Indonesian government sources
Every data point is marked with its verification status. We source from OSS.go.id, BKPM, Imigrasi.go.id, and Peraturan.go.id. This is informational guidance — always confirm with a licensed Indonesian lawyer for your specific situation.
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Disclaimer: This guide is for informational purposes only and does not constitute legal, tax, or professional advice. Regulations in Indonesia change frequently. Always consult with a qualified Indonesian lawyer and licensed tax consultant before making business decisions. Information on this page was last reviewed in March 2025 and may not reflect the most current regulations. IndonesiaCompliance is not a law firm and does not provide legal services.