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Update on Licensing Procedures for National Construction Service Businesses in Indonesia

Update on Licensing Procedures for National Construction Service Businesses in Indonesia Review by tenissa.tjahjono on 14. 10. 2019 Company Registration in Indonesia, Market Research in Indonesia, Work Permit in Indonesia, Product Registration in Indonesia, Local Partner Selection in Indonesia, Trade Mission in Indonesia, Company Formation in Indonesia, Company Establishment in Indonesia, Company Set Up in Indonesia, Payroll Outsourcing in Indonesia, Tax Reporting in Indonesia, Medical Product Registration in Indonesia, Medical Device Registration in Indonesia, Cosmetic Registration in Indonesia, Food Supplement Registration in Indonesia.
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Effective from June 13, 2019, the Minister of Public Works and Public Housing has enforced Regulation No. 08/PRT/M/2019 (or Regulation 8/2019) on Guidelines for National Construction Service Business Licensing Services. This regulation is enacted for the purpose to fulfill the requirements for standardised business licensing for construction companies in Indonesia.

Regulation 8/2019 has replaced the previous Regulation No. 04/PRT/M/2011 (Regulation 4/2011) on Requirement Guidelines for the Granting of National Construction Service Business Licenses.

Scope of Regulation 8/2019

Regulation 8/2019 addresses licensing regulations for construction service sector, especially at the regional level. This regulation covers the following items:

  1. Types of licenses
  2. Obtaining Construction Service Business Licenses IUJK (Izin Usaha Jasa Konstruksi)
  3. Obtaining Individual Registration Certificates TDUP (Tanda Daftar Usaha Perseorangan)
  4. Implementing Licenses

construction companies in indonesia

Types of Licenses

For the construction service sector in Indonesia, there are two types of applicable license: TDUP and IUJK. Both licenses have to be issued by relevant authorities through the Online Single Submission (OSS) system.

TDUP
This license is given to individuals, covering the construction service operations.

IUJK
This license is released to National Construction Service Enterprises BUJKN (Badan Usaha Jasa Konstruksi Nasional), covering the construction service operations as well.

Holders of TDUP or IUJK are able to participate in the following activities:

  • Construction works
  • Construction consultation
  • Integrated construction works (applicable for IUJK holders only)

Obtaining TDUP

By possessing a TDUP under the new regulation, TDUP will remain valid permanently for Indonesian individuals, as long as the registered services for TDUP are in operation. The following lays out the process of securing a TDUP:

1. Individuals must register via the OSS system to secure the NIB or Business Identification Numbers.

2. TDUP will only be issued when individuals upload the following items:

  • Names and KBLI codes (Indonesia Standard Industrial Classification Codes)
  • TDUP commitment statement

 

3. TDUP commitment must be fulfilled within 30 working days once the TDUP is issued through OSS.

  • For construction consultation, minimum level 8 expert work competence qualification certificates are required
  • For construction works, minimum level 5 technician work competence qualification certificates are required

 

4. Individuals submit all commitment documents. Then, these documents will be verified and validated by DPM PTSP (Investment Units and One-Stop Integrated Service) within five working days.

5. TDUP is only effective when it passes verification and validation, issued by OSS with the approval from DPM PTSP.

Obtaining IUJK

BUJKN that obtains the new IUJK will have a IUJK validity that lasts for as long as the operation is active, instead of the previous three-year validity with the extensions. The process is shown below:

1. The person in charge or PJBU (Penanggung Jawab Badan Usaha) must register via the OSS system to secure the NIB or Business Identification Numbers.

2. IUJK will only be issued when the following items are uploaded:

  • Names and KBLI codes
  • IUJK commitment statement

 

3. IUJK commitment, which is to possess the Enterprise Certificates (SBU), must be fulfilled within 30 working days once the IUJK is issued through OSS.

4. PJBU should submit all commitment documents. Then, these documents will be verified and validated by DPM PTSP within five working days.

IUJK is only effective when it passes verification and validation, issued by OSS with the approval from DPM PTSP.

Implementing Licenses

It is compulsory for TDUP and IUJK holders to perform the following activities during their construction service operations.

Holders of TDUP

  • Submit business activity reports annually
  • Operate a minimum of one construction service project within the valid period of the competence certificates

 

Holders of IUJK

  • Members of BOC and BOD, PJBU and Technical PJBU of BUJKN, should not hold similar positions in other construction service companies in Indonesia. Evidence must be shown on affidavits
  • Submit business activity reports annually
  • Organise construction services according to BUJKN market segments and related qualifications
  • Operate a minimum of one construction service project within the three-year valid period of SBU
  • Employ construction employees with competence certificates

How Cekindo can Help

Cekindo helps entrepreneurs and international businesses to set up construction companies and other companies as well in Indonesia. Our team of professional consultants and legal specialists can also assist you in applying for relevant business licenses in Indonesia.

Talk to our experts now and we will guide you further. Fill in the form below or visit one of our offices in Jakarta, Bali and Semarang.

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