For PMA (Foreign-Owned Companies) operating in Indonesia, 2026 marks a critical shift from administrative compliance to fully monitored, system-driven corporate governance.

With the full implementation of Minister of Law and Human Rights Regulation No. 49 of 2025, all corporate reporting obligations including financial statements and General Meeting of Shareholders (GMS) must now be conducted through the online SABH system (Legal Entity Administration System).

This means:

• No more manual or informal processes

• Strict deadlines enforced digitally

• Automatic sanctions for non-compliance

For PMA companies, this is not just a regulatory issue. It directly impacts legal standing, operational continuity, and investor confidence.

 

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Mandatory Financial Reporting Obligations for PMA Companies

1. Annual Report Preparation (Legal Basis: Article 66 of Company Law)

Under Article 66 paragraph (1) of Law No. 40 of 2007 on Limited Liability Companies, the Board of Directors is legally required to prepare and submit an annual report to the GMS.

According to Article 66 paragraph (2), the financial statements must include:

• Statement of Financial Position (Balance Sheet)

• Profit and Loss Statement

• Cash Flow Statement

• Statement of Changes in Equity

• Notes to Financial Statements

These reports must comply with Indonesian Financial Accounting Standards (SAK).

For PMA companies, this requirement is especially important as financial statements are often reviewed by:

• Foreign shareholders

• Group headquarters

• External auditors and regulators

2. Approval through General Meeting of Shareholders (GMS)

Based on Article 69 paragraph (1) of the Company Law, the annual report must be approved in a GMS.

This approval is not merely procedural. It has legal consequences:

• Formal accountability of the Board of Directors

• Legal discharge (acquit et de charge)

• Validation of company performance

Without a properly conducted GMS, financial statements are not legally finalized.

3. Signing Requirement by Directors and Commissioners

As stated in Article 66 paragraph (3), the annual report must be signed by all members of the Board of Directors and Board of Commissioners.

This creates joint responsibility over the accuracy and integrity of financial reporting, which is particularly critical in PMA structures with cross-border governance.

4. Mandatory Audit Requirement (Article 68 of Company Law)

Under Article 68 paragraph (1), financial statements must be audited by a public accountant if the company:

• Manages or collects public funds

• Issues debt instruments to the public

• Is a public company (Tbk)

• Meets certain asset or revenue thresholds (commonly ≥ IDR 50 billion)

For many PMA companies, even when not strictly required, audit is often expected by global headquarters or investors.

 

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Mandatory Electronic Reporting via SABH (Permenkumham No. 49/2025)

The latest regulation introduces a fully digital compliance framework.

Key Requirements:

• All corporate reporting must be submitted via SABH (Legal Entity Administration System)

• Annual report must be presented to GMS within 6 months after financial year-end

• GMS approval must be notarized and reported to the Ministry within 30 days

Starting mid-2026, manual submission is no longer allowed.

 

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Real Risks for Non-Compliant PMA Companies

The 2026 regulatory framework introduces automated enforcement mechanisms, including:

1. Electronic Warning Letters

Companies failing to comply will receive official warnings through the system.

2. SABH Access Blocking

If unresolved, the government may block access to SABH, resulting in:

• Inability to update company data

• Inability to change directors or shareholders

• Inability to execute corporate actions

3. Operational and Legal Disruption

For PMA companies, this can create serious consequences:

• Delayed business expansion

• Issues with banking and licensing

• Reduced credibility with partners and regulators

 

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Beyond Compliance: A Strategic Necessity for PMA Companies

For foreign investors, compliance with Indonesian regulations is not just about avoiding penalties. It is about:

• Ensuring Good Corporate Governance (GCG)

• Maintaining transparency across jurisdictions

• Supporting cross-border reporting consolidation

• Building long-term trust with regulators and stakeholders

In practice, well-managed compliance directly impacts a company’s ability to scale in Indonesia and across ASEAN.

 

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Common Challenges Faced by PMA Companies

Despite clear regulations, many PMA companies still face:

• Misalignment between local accounting and group reporting

• Delays in GMS scheduling

• Incomplete or non-compliant financial statements

• Lack of understanding of SABH reporting procedures

These gaps often remain unnoticed until they create legal or operational barriers.

 

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Do Not Wait for a Problem to Act

In a system where compliance is monitored digitally and enforced automatically, proactive action is no longer optional.

We support PMA companies in Indonesia with:

• Audit services in line with Article 68 of Company Law

• Financial statement preparation compliant with Indonesian standards

• GMS structuring and documentation aligned with legal requirements

• SABH reporting and corporate compliance support

Contact us today for a consultation and ensure your PMA company is fully compliant, audit-ready, and strategically positioned for growth in Indonesia.

[Schedule an Initial Consultation]

 

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