Home Blog Requirements to Have AMDAL in Indonesia (Update 2023) Business Setup | Indonesia | Legal Updates Requirements to Have AMDAL in Indonesia (Update 2023) InCorp Editorial Team 23 June 2025 5 minutes reading time Table of Contents Compulsory AMDAL for Business in Indonesia Businesses or Activities Exempted from AMDAL in Indonesia Categories of AMDAL Simplification on Issuance of Feasibility Decrees Assessment of AMDAL Consult with InCorp Indonesia The Minister of Environment and Forestry has introduced a new framework for the Environmental Impact Analysis by introducing Regulation of Government No. 22 of 2021 on the Organization of Environmental Protection and Management. A Ministerial Regulation No. 4 of 2021 soon followed concerning the List of Businesses and/or Activities Required to Obtain Environmental Impact Analyses, Environmental Management Efforts, and Environmental Monitoring Efforts or Statements of Ability to Manage and Monitor the Environment. Those regulations are made to enhance the business climate in Indonesia. The new framework of MR 04/2021 provides a more defined and detailed system covered of the Environmental Impact Analyses (AMDAL) of environmental protection, categorized into specific subject areas listed below: Environmental approvals; Protection and management of water, air, and ocean quality; Environmental damage control; Waste management; Guarantee funds for the restoration of environmental functions; Environmental information systems; Development and supervision; and Imposition of administrative sanctions. Compulsory AMDAL for Business in Indonesia Business activities that have a significant adverse impact on the environment will have to obtain an AMDAL, including those meeting the following conditions: Natural resources (renewable and non-renewable ) exploitation Landscapes and landform changes Activities that will potentially cause emission pollution and/or environmental degradation Activities that will potentially affect the natural environment, social environment, or artificial environment Activities that will potentially disturb the natural resource preservation and/or culture reserve’s protection Preparation Phase During the preparation of AMDAL, the respective person-in-charge (“PIC“) need to obtain three types of documents specifically: Terms of Reference form; Environmental Impact Statement (“Andal“); Environmental Management and Monitoring Plan (“RKL-RPL“). The following steps must be followed to obtain the documents as mentioned earlier: Community involvement applies explicitly to any communities which will be directly impacted by the businesses/activities; Examination of the Terms of Reference by authorized officials; Prepare and submit Andal and Environmental Management and Monitoring Plan (“RKL-RPL“) documents to the authorities. In addition, several businesses and/or activity plans require AMDAL, Environmental Management Efforts and Environmental Monitoring Efforts (“UKL-UPL“), and Environmental Management Efforts and Environmental Monitoring Efforts (“SPPL“) as mandatory prerequisites. The following sectors are listed under Appendix I to MR 04/2021, such as: Transportation Satellite technology Public works and housing Industry Tourism Agriculture Nuclear power Health Fisheries and maritime affairs Electricity Environment and forestry Energy and mineral resources Telecommunications The regulation also stated specifics activities of which businesses must obtain the compulsory AMDAL in Indonesia: Activities performed in areas that are directly adjacent to preserved areas Activities that affect the functions of protected areas based on scientific evidence Businesses or Activities Exempted from AMDAL in Indonesia Some businesses and activities are exempted from obtaining AMDAL in Indonesia: Non-commercial technological research and development Explorations that do not change the landscape or landform; non-commercial scientific and developments that do not disturb the functions of the protected areas; activities that support the preservation of protected areas Activity locations that are included in the KLHS; activity locations that are in relevance to the use of timber forests for the protection of peatland ecosystems; activity locations that are used for emergency disaster responses Businesses/activities that involve special economic zones, ports, free-trade areas, and industrial areas Activities for environmental restoration in unlicensed areas Businesses still need to apply for relevant permits even though they are exempted from the compulsory AMDAL. These necessary permits are the UKL-UPL or SPPL. Categories of AMDAL All business sectors and activities that must acquire AMDAL are put into different AMDAL categories, depending on the level and complexity of their impact on the environment: Category A: business sectors and activities that are highly sensitive and complex with >9 cumulative values Category B: business sectors and activities that are moderately sensitive and complex with 6-9 cumulative values Category C: business sectors and activities that are neither sensitive nor complex with <6 cumulative values Simplification on Issuance of Feasibility Decrees One of the most notable adjustments in GR 22/2021 is a more simplified process for issuing Feasibility Decrees. Under previous regulations, it was required to submit separate environmental license applications while the Andal and RKL-RPL document assessment requests were submitted. Any recommendation that results from a feasibility assessment will then become a consideration that will be assessed by authorized officials (Minister of Forestry and Environmental Affairs or of local governments) before the issuance of either an Environmental Feasibility Decree or an Environment Infeasibility Decree. The respective officials must issue one of these decrees within 10 business days of receiving any environmental feasibility recommendation. If said authorized officials give a Feasibility Decree, this will be announced to the public through the System, mass media, and/or announcement on their business premises. This announcement is required to be made within 5 business days of the issuance. Assessment of AMDAL Submitted AMDAL and RKL-RPL documents must then be assessed by the Environmental Feasibility Test Team about administrative and substantive matters. If Andal and RKL-RPL documents have passed the substantive assessment phase, then the Team will conduct a feasibility assessment based on specific established feasibility criteria. Based on the feasibility assessment, the Team will issue either a recommendation of environmentally deeming it feasible or otherwise. It should be noted that the maximum period for any substantive assessment of Andal and RKL-RPL documents and feasibility assessments is set at 50 business days from when Andal and RKL-RPL documents are declared to have passed the administrative assessment stage. Consult with InCorp Indonesia InCorp Indonesia (an Ascentium Company) is one of Indonesia’s top business consulting firms, providing business and legal consultation to companies. We work directly with foreign investors and the top management team to get to know your business from top to bottom to provide you with the most practical advice and solutions. Are you still trying to understand the AMDAL requirements in Indonesia? Simply contact us by filling in the form below. We are confident that you will receive legal and business advice that allows you to make informed, calculated business decisions. Read Full Bio Verified by Hotdo Nauli Senior Legal & Delivery Manager at InCorp Indonesia Hotdo heads the Legal and Delivery team at InCorp Indonesia, managing Product Registration, Legal Advisory, and Business Licensing. With over 8 years of experience, she focuses on compliance and integrity, ensuring all client operations align with Indonesian laws and regulatory standards, including contract reviews and sector-specific licenses. She is also a licensed advocate and a member of the Indonesian Advocates Association (PERADI). Frequently Asked Questions Are there investment facilities provided for foreign investors in Indonesia? A newly established PMA company in Indonesia is typically provided with import facilities, tax holidays, tax allowances, or investment allowances. Import facilities Investors in Indonesia, particularly in manufacturing, may benefit from import tax exemptions for capital goods and raw materials through the Master List Facility. The imported goods must meet specific criteria, such as not being produced locally or not meeting industry demand despite local production. Tax holiday The government offers CIT reductions of 50% or 100% for 5–20 years for listed pioneer industries, based on investment value. After this period, a CIT reduction of 25% or 50% applies for two fiscal years. Non-listed sectors can also apply by meeting criteria demonstrating pioneer industry status. Pioneer industries are industries that have a wide range of connections, provide additional value and high externalities, introduce new technologies, and have strategic value for the national economy. Tax allowance For companies in certain designated areas or regions, the government may provide the following tax concessions: Net income reduction up to 30% of the amount invested, prorated at 5% annually for six years, on condition that the assets invested are retained for the same duration. Accelerated depreciation and/or amortisation deductions An extension of tax losses carried forward for a maximum of ten years A 10% (or lower if treaty relief is available) withholding tax rate on dividends paid to non-residents The applicant eligible has to meet high-level-criteria for the above tax facilities: High investment value or for export purposes High manpower absorption High level of local content Investment allowance The government offers a reduction in net income of up to 60% of the investment, distributed at 5% annually over six years of commercial production, contingent upon the retention of invested assets for the same duration. To qualify, applicants must meet business line eligibility criteria and employ a minimum of 300 Indonesian workers in the project. Super deduction This facility could be granted to certain businesses, such as: 60% reduction in net income of the amount of tangible fixed assets invested for labor-intensive industries, distributed throughout a certain time frame. Up to 200% reduction in the gross income of the amount spent for human resources development in certain competency activities. Up to 300% reduction in gross income of the amount spent for certain R&D activities in Indonesia. What is the minimum shareholder requirement to incorporate a PT? The minimum number of shareholders to incorporate a PT is two Can a PMA company keep non-Rupiah bookkeeping and use a language other than Indonesian? For tax purposes in Indonesia, companies must maintain their books in Rupiah, using the Indonesian language, and store them within the country. Exceptions for using USD and English in bookkeeping require prior notification to the authorities and any use of languages other than Indonesian needs approval from the Ministry of Finance. Can Investors 100% own a PT PMA Company? According to Presidential Regulation No. 10/2021 and the amended version, all businesses are open for domestic and foreign investment with these limitations and classifications: Eight businesses are closed to foreign investment and may be operated by the central government. Designated business sectors or joint ventures with cooperatives (koperasi) and micro, small, and medium enterprises Open businesses are subject to specific conditions, such as those that are exclusively available to 100% local investors, those with restricted foreign shareholding, and investments requiring special licenses Certain sectors are closed to foreign investment, including narcotics cultivation, gambling, and environmental conservation activities. Get in touch with us. 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