Welcome to our guide on establishing a PT PMA in Bali’s construction sector, specifically for residential building construction under KBLI Code 41011.
KBLI 41011 covers the construction, maintenance, renovation, and reconstruction of residential buildings, including houses, temporary residences, apartments, condominiums, and similar residential properties. It may also cover residential buildings constructed by real estate companies for sale, subject to the company’s complete business model and any additional KBLI classifications required.
Indonesia has introduced important updates to its business licensing system, including the implementation of Government Regulation No. 28 of 2025 on Risk-Based Business Licensing, which replaced Government Regulation No. 5 of 2021.
Table of Contents
Overview
KBLI Code 41011 covers businesses engaged in the construction, maintenance, and/or reconstruction of residential buildings.
The scope includes:
- Private houses and residential buildings;
- Temporary residential buildings;
- Apartments;
- Condominiums;
- Residential complexes;
- Major residential renovations and structural modifications; and
- Residential buildings constructed by real estate companies for sale.
Indonesia has also begun implementing KBLI 2025 within the OSS system. Companies using KBLI 2020 classifications should check whether their activities must be converted or adjusted to the corresponding KBLI 2025 classifications when submitting a new application or making changes through OSS.
Legal Basis
The legal framework for a foreign-owned construction company in Indonesia includes several regulations covering investment, company establishment, construction services, professional competency, and risk-based business licensing.
Government Regulation No. 28 of 2025 is now the principal regulation governing Indonesia’s risk-based business licensing system. It replaced Government Regulation No. 5 of 2021, which should no longer be presented as the primary current licensing regulation.
Foreign investment availability must also be reviewed under Indonesia’s current investment framework. Presidential Regulation No. 10 of 2021, as amended by Presidential Regulation No. 49 of 2021, generally provides that commercial business sectors are open to investment unless they are specifically closed, reserved, or subject to particular conditions.
Type of License
A company operating under KBLI 41011 will generally begin its licensing process by establishing an Indonesian legal entity and registering its business activities through the Online Single Submission Risk-Based Approach system, or OSS RBA.
Minister of Public Works and Housing Regulation No. 8 of 2022 regulates construction business certification and competency certification. It recognizes the SBU as evidence of a construction business entity’s classification and qualification and the SKK as evidence of a construction worker’s professional competency.
A PT PMA must not begin regulated construction activities merely because it has obtained an NIB. It must complete all relevant licensing and certification requirements applicable to its risk level and construction qualification.
Coverage of Service
KBLI 41011 generally covers the physical implementation of residential building construction activities, including:
- Construction of houses and residential buildings;
- Construction of apartments and condominiums;
- Construction of temporary residential buildings;
- Maintenance of residential buildings;
- Reconstruction of residential buildings;
- Major structural renovations;
- Building extensions and modifications; and
- Residential construction performed under a contract or as part of a qualifying property development activity.
The classification should not automatically be interpreted as covering every service related to a construction project.
A company intending to provide both design and construction services should review whether it requires separate classifications for construction consultancy, architectural services, engineering services, or integrated construction activities.
Business Scale, Land Area, and Risk Level
Foreign investment construction companies are generally expected to operate as large-scale businesses and meet the qualification, capital, personnel, experience, and equipment requirements applicable to their construction subclassification.
Under Indonesia’s risk-based licensing system, the required business authorization may consist of:
- An NIB for lower-risk activities;
- An NIB and Standard Certificate for medium-risk activities; or
- An NIB, Standard Certificate, and additional license or approval for higher-risk activities.
In Bali, these matters are particularly important because construction may be affected by regional zoning plans, agricultural land protections, coastal setbacks, river setbacks, sacred-area restrictions, cultural requirements, and local building regulations.
Authorities Granting Licenses
The establishment and licensing of a PT PMA construction company may involve several government authorities.
The authority responsible for issuing, verifying, or supervising a license depends on the type of business approval and the scale, location, and technical characteristics of the project.
Although much of the licensing process is coordinated through OSS, certain technical documents, certificates, and project approvals may still require verification from the relevant ministry, local government, certification body, or professional authority.
Requirements and Obligations for Business Licensing
A company operating under KBLI 41011 must maintain compliance not only during the initial registration process but throughout its operations.
Its principal requirements and obligations may include:
- Maintaining a valid NIB and verified Standard Certificate;
- Meeting the required construction business qualification.
Current enforcement provisions also recognize sanctions for construction companies that fail to maintain an SBU, fail to employ properly certified construction personnel, fail to provide required equipment, fail to submit annual activity reports, or fail to comply with the capital structure and technical criteria applicable to foreign investment construction companies.
The company license and the project license are not the same. A PT PMA may be legally established as a construction company while still being prohibited from commencing a particular project until the required project-level approvals have been obtained.
Resources
Online Single Submission System: https://oss.go.id/
Ministry of Investment and Downstream Industry/BKPM: https://www.bkpm.go.id/
Ministry of Public Works: https://pu.go.id/
Government Regulation No. 28 of 2025 on Risk-Based Business Licensing: https://peraturan.bpk.go.id/Details/319773/pp-no-28-tahun-2025
Presidential Regulation No. 10 of 2021 on Investment Business Fields: https://peraturan.bpk.go.id/Details/161806/perpres-no-10-tahun-2021
Minister of Public Works and Housing Regulation No. 8 of 2022: https://peraturan.bpk.go.id/Download/219503/2022pmpupr8.pdf
Official OSS Description for KBLI 41011: https://oss.go.id/kbli/detail/ae6b72e0-49ba-4ce6-a337-90f542145ef2
Frequently Asked Questions
Q: What are the key requirements for setting up a PT PMA in Indonesia’s construction industry?
A: The company must generally be established as an Indonesian limited liability company with at least two shareholders.
The shareholders may be individuals or legal entities, subject to Indonesia’s foreign investment rules. A local Indonesian shareholder is not automatically required merely because the company is a PT PMA. However, the ownership structure must comply with the investment conditions applicable to the selected business activities.
Q: How does KBLI Code 41011 affect the establishment of a construction company in Bali?
A: KBLI 41011 determines the principal business scope of a company carrying out residential building construction.
It covers houses, temporary residences, apartments, condominiums, maintenance, reconstruction, structural changes, and major residential renovation. The OSS system links this activity to the residential building construction subclassification BG010.
Q: What are the advantages of setting up a foreign-owned construction company in Bali?
A: Establishing a properly licensed PT PMA allows foreign investors to conduct eligible construction activities through an Indonesian legal entity.
Q: How can a foreign-owned construction company navigate the regulations in Bali?
A: The company should begin by confirming its complete business model before selecting its KBLI classifications.
All company and project approvals should be obtained before regulated construction activities begin.
Q: What are the most important factors to consider when choosing a business location for a construction company in Bali?
A: For the company’s registered office, the business should consider whether the address is located in a permitted commercial or business zone. For a construction project, the company should separately examine:
- Land title and ownership;
- Zoning and spatial conformity;
- Access-road status.
Q: How can a foreign-owned construction company build a strong local network in Bali?
A: Building a reliable local network requires professional relationships. Engaging with the surrounding community and respecting Bali’s cultural and environmental context can also reduce operational risks and support smoother project implementation.
Q: What are the most common challenges faced by foreign-owned construction companies in Bali?
A: These risks can be reduced through proper due diligence, realistic project planning, written agreements, professional supervision, accurate financial records, and regular compliance reviews.
