Business License application in Indonesia

Requirements for Obtaining Business License Indonesia

  • InCorp Editorial Team
  • 18 November 2015
  • 3 minute reading time

A business license in Indonesia is essential to conduct business activities in any sector. In Indonesia, there are licenses or permits that need to be obtained in order to perform business activities legally.

Either setting up a company, market your products, or conducting trading activities. The government will issue the licenses once the business has already been fulfilling any requirements based on the regulations.

Why Obtain a Business License in Indonesia?

Obtaining a business license is mandatory for any business entity in Indonesia, whether they are small and medium enterprises or large-scale companies.

Licenses are becoming critical to companies since this would legalize their business activities in Indonesia. Without licenses, your business activities may potentially be closed by the government.

How are the regulations?

Based on the 2015 regulation, all newly-formed foreign companies should apply for a business license by providing their financial audit in order to be able to apply for permanent business licenses and other necessary licenses such as import licenses, etc.

Through this regulation, the government intends to ensure that every foreign investor will realize their investment plan instead of only submit their investment plan to the Investment Coordinating Board (BKPM) on the paper. Therefore foreign investments in Indonesia can be proved that are running well according to their purpose.

Classifications of Business License for a PMA in Indonesia

  • A company engaged in general trading, goods, or other services should have a business license;
  • A company engaged in the manufacturing industry outside of oil, gas, and geothermal energy, should have an industrial business license;
  • A company engaged in other industries, such as construction, should have a construction business license; and
  • Other licenses based on the company’s business activities.

Business License Indonesia: Procedures & Requirements

Business License Requirements

A permanent business license will be given to a PMA Company once it meets the following requirements:

  • Has been in the production phase
  • Has exceeded the allotted time (3 years)

Application Procedures

  • A PMA Company may apply for a permanent license to the Head of Investment Coordinating Board (BKPM) or Head of Region Investment Coordinating Board (BKPMD). Regarding the issuer, it depends upon the foreign investment license, the business activities, and also the domicile of the company;
  • The applicant should complete and sign the application form for a business license at BKPM or BKPMD office and attach the required documents; and
  • BKPM or BKPMD officers will check all the files and the eligibility and completeness of the application, and then issue the permanent license certificate.

Read also: Understanding The Different Types of Business Licenses in Indonesia

Required Documents

  • A copy of:
    • Permit approval for investments;
    • Deed of establishment and its amendments;
    • Company domicile, NPWP, and TDP;
    • Contract/rental of business premises and certificate from the owner of the building;
    • ID card and passport of KITAS for foreigners;
  • Nuisance Act Permit and Location Permit (SITU);
  • List of office equipment and industrial equipment; and
  • Company organizational structure.

Process Time and Validity

  • After fulfilling all documentation requirements, the processing time for a business license application takes 14 working days;
  • A business license is generally valid for 30 years;

Obtaining Business Licenses in Indonesia with Cekindo

Having years of experience in helping small, medium, to multi-national companies to establish their businesses in Indonesia, Cekindo can help you get a business license in Indonesia according to your business needs and targets.

Write down the details of your business needs below, our consultants will immediately contact you to discuss in more detail.

Pandu Biasramadhan

Senior Consulting Manager at InCorp Indonesia

An expert for more than 10 years, Pandu Biasramadhan, has an extensive background in providing top-quality and comprehensive business solutions for enterprises in Indonesia and managing regional partnership channels across Southeast Asia.

Get in touch with us.

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Disclaimer: The information is provided by PT. Cekindo Business International (“InCorp Indonesia/ we”) for general purpose only and we make no representations or warranties of any kind.

We do not act as an authorized government or non-government provider for official documents and services, which is issued by the Government of the Republic of Indonesia or its appointed officials.

We do not promote any official government document or services of the Government of the Republic of Indonesia, including but not limited to, business identifiers, health and welfare assistance programs and benefits, unclaimed tax rebate, electronic travel visa and authorization, passports in this website.

Frequent Asked Questions

Yes, you must apply for it to be able to issue work permits for your foreign employees. This permanent business license is also a prerequisite for the applications for other business licenses and import licenses.

There are three things business owners need to consider before setting up a business in Indonesia: the type of business entity, capital requirements, and regulations.

Indonesian regulations separate local companies from foreign companies. Generally, foreign-owned companies (PT PMA) have more limitations than their local counterparts (Local PT). However, to pursue more foreign direct investment in the country, the government has taken several bold initiatives to increase the ease of doing business and provide numerous attractive incentives for foreign investors.

There are two main types, namely, primary business licenses and non-primary business licenses. The primary ones commonly apply to various industries, such as general and industrial business licenses. Additional non-primary ones are included, depending on the operations of your business. Examples of non-primary business licenses are operational and commercial licenses.