Foreign Business Setup Guide
How to Start an Education Institution in Surabaya as a Chinese Foreigner
Everything you need to know about licenses, company setup, and compliance requirements for Chinese entrepreneurs opening a education institution in Surabaya, Indonesia.
Licenses Required
3
Est. Cost Range
$697 - $4,065
Timeline
107-163 days
Quick Answer
Yes, Chinese foreigners can start a education institution in Surabaya, Indonesia. This business activity is open to foreign investment with up to 67% foreign ownership through a PT PMA (foreign-owned limited liability company).
You will need approximately 3 licenses and can expect the process to take 107-163 business days. The estimated government and service fees range from Rp 10.800.000 to Rp 63.000.000.
Foreign Ownership Rules
Foreign Ownership
Up to 67%
DNIB Status
conditional
Recommended Structure
PT PMA (Foreign Investment Company) (PT PMA)
As a foreign investor opening a education institution 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 Licenses & Permits
Licenses required to operate a education institution 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 Pendirian Satuan Pendidikan (Education Establishment License)
sector_specific
▾
Izin Pendirian Satuan Pendidikan (Education Establishment License)
sector_specific
Estimated Cost
Rp 10.000.000 - Rp 50.000.000
Varies by education level and province
Processing Time
90 business days
Validity
Varies
Persetujuan Bangunan Gedung (Building Approval)(PBG)
location
▾
Persetujuan Bangunan Gedung (Building Approval)(PBG)
location
Estimated Cost
Rp 2.000.000 - Rp 20.000.000
Based on building size and retribusi rate per m2. Higher in Jakarta/Bali.
Processing Time
30 business days
Validity
Varies
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Step-by-Step Setup Process
The typical process for a Chinese entrepreneur setting up a education institution in Surabaya (13 steps).
Prepare Documentation Including Curriculum
~14 daysGather passport, proof of address, apostilled documents, and prepare a comprehensive education business plan including curriculum framework, teaching methodology, target student demographics, and facility requirements.
Reserve Company Name via AHU Online
~3 daysSubmit 3 company name choices to Kemenkumham through the AHU Online system. Education institution names must reflect the educational nature of the business.
Draft Deed of Establishment with Notary
~7 daysWork with a notary to prepare articles of association with KBLI codes 85411/85499 for education services. Education institutions often operate as Yayasan (foundation) or PT PMA.
Register with Kemenkumham
~14 daysSubmit the notarial deed for legal entity approval. Education entities require specific registration reflecting their educational purpose.
Obtain NIB through OSS
~1 dayRegister on OSS to get your NIB. Select appropriate KBLI codes for your education type. Education institutions are typically classified as medium-to-high risk.
Apply for Izin Lokasi (Location Permit)
~14 daysObtain location approval confirming your premises is zoned for educational use. Schools have specific requirements for building size, outdoor space, and distance from hazards.
Apply for Education License (Izin Pendirian Satuan Pendidikan)
~60 daysObtain the Education Establishment License from the local Dinas Pendidikan (Education Office) or Ministry of Education for international schools.
Pro tip: Requires curriculum approval from Ministry of Education. International schools need additional accreditation. The Indonesian national curriculum component is mandatory even for international schools.
Building Safety Inspection
~14 daysPass a mandatory building safety inspection covering structural integrity, fire safety, emergency exits, and accessibility for students with disabilities.
Apply for PBG (Building Permit) for New Construction
~30 daysIf constructing new educational facilities, apply for PBG from the local government. Education buildings have specific safety and accessibility requirements.
Open Corporate Bank Account
~14 daysOpen a corporate bank account and deposit the required paid-up capital. Education institutions may also need to set up tuition payment collection systems.
Register for Tax (NPWP & PKP)
~7 daysObtain company NPWP and register as PKP. Education services have specific VAT exemptions - formal education is generally VAT-exempt, while non-formal education may be subject to VAT.
Hire Certified Indonesian Teaching Staff
~30 daysRecruit and hire Indonesian national teachers who meet the certification requirements set by the Ministry of Education. This is a regulatory requirement before commencing operations.
Pro tip: Minimum 30% of teaching staff must be Indonesian nationals. Foreign teachers need Indonesian language proficiency and recognized teaching certifications from their home country.
Apply for Work Permits & KITAS for Foreign Teachers
~45 daysApply for RPTKA and IMTA for all foreign teaching staff. Education sector work permits have specific requirements including teaching qualifications verification.
Estimated Total Timeline
253 days(9 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 Pendirian Satuan Pendidikan (Education Establishment License)(Varies by education level and province) | Rp 9.000.000 | Rp 45.000.000 | $581 - $2,903 |
| Persetujuan Bangunan Gedung (Building Approval) (PBG)(Based on building size and retribusi rate per m2. Higher in Jakarta/Bali.) | Rp 1.800.000 | Rp 18.000.000 | $116 - $1,161 |
| 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 47.700.000 | Rp 156.600.000 | $3,077 - $10,103 |
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 Chinesenational, you'll need the right visa to live and work in Indonesia while running your education institution.
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
Chinese 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 Chinese Entrepreneurs
Country-specific information for Chinese nationals setting up a business in Indonesia.
Recommended Visa Pathway
Investor KITAS. Chinese nationals benefit from ASEAN+3 business facilitation. B211A available with sponsor.
Estimated processing time: 40 business days
Tax Treaty Information
China-Indonesia DTA active. China taxes worldwide income for residents. Transfer pricing scrutiny is high for Chinese-Indonesian business structures.
Trade Agreements & Bilateral Benefits
ASEAN-China Free Trade Area (ACFTA) provides tariff reductions. ASEAN+3 business facilitation framework applies.
Common Issues for Chinese Nationals
Language barrier is common - hire bilingual Indonesian-Chinese staff
Capital transfer from China subject to SAFE regulations (max $50,000/year for individuals)
Anti-Chinese sentiment exists in some regions - use local business partner
WeChat Pay/Alipay not widely accepted - need Indonesian banking
Document Requirements for Chinese Citizens
- Documents must be notarized by Chinese notary public and authenticated by Chinese Ministry of Foreign Affairs
- Criminal background check from local Public Security Bureau
- Education certificates must be verified by CDGDC
Embassy & Consulate
Chinese Embassy Jakarta: Jl. Mega Kuningan No.2. Chinese Consulates in Surabaya, Medan, and Denpasar.
Business Culture Tips
Indonesia has a significant ethnic Chinese population. Mandarin-speaking staff are available in major cities. Business dinners are common for relationship building. Gift-giving customs are similar.
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 education institution.
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 Chinese citizen own 100% of a education institution in Surabaya?
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Chinese nationals can own up to 67% of a education institution in Surabaya through a PT PMA. Ownership limits range from 49% to 67% depending on the specific business activity.
What licenses do I need to start a education institution in Surabaya?
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You will need 3 licenses to operate a education institution in Surabaya. These include: NIB, Izin Pendirian Satuan Pendidikan (Education Establishment License), PBG. 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 education institution in Surabaya?
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Based on the 3 required licenses, government and service fees for a education institution in Surabaya range from Rp 10.800.000 to Rp 63.000.000 (approximately $697 to $4,065). 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 education institution in Surabaya?
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The typical timeline is 107-163 business days from start to fully operational in Surabaya. This includes company registration, obtaining all 3 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 education institution in Indonesia?
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Yes, a local partner is required for 2 of your 2 KBLI codes 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 a Chinese to run a business in Indonesia?
▾
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 education institution 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?
▾
You must file monthly tax returns (VAT, employee tax), submit an annual corporate tax return, renew applicable licenses (you have 3 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.