Food and beverages industry has been growing in recent years. The rising personal income, as well as increase in spending on food and drink of growing middle class, has been the main contributors to its development. Along with very positive prognosis of the future growth (doubled middle class till 2020), Indonesia expects more companies will enter the food and beverage market in Indonesia. This, however, might be a tricky game. Why? Because you need to register food products to BPOM before you can distribute your products.
The National Agency for Food and Drug Control (FDA) or Badan Pengawas Obat dan Makanan (BPOM) is the one who regulates the food products in Indonesia
Indonesian laws understand the term “food” as anything that comes from biological sources of agricultural products, plantations, forestry, fisheries, farms, or marine or water environments, whether it is processed or unprocessed, that is used as food or drink for human consumption. Even though BPOM supervise the medicines & therapeutic goods and food products, both have different regulations.
In addition, BPOM has defined the company doesn’t need to register food products in conditions as follows:
Coming back to the question from the headline – you need to register your food products unless it is used as an ingredient in an end product.
However, be aware. Being a country with a vast Muslim majority, alcoholic beverages are controlled and subject to high rates of excise as well as strict requirements for obtaining approval for their importing.
Related article: Food and Beverage Registration in Indonesia
A local company, a local agent or a distributor are the one that can register food products. In case you do not have your own company or you have not selected any importer yet, you should consider following options.
A foreign-owned company, also known as PT PMA, allow foreign ownership up to 100%. However, the percentage changes depending on individual conditions, e.g. sector in which a company is running its business.
Foreigners can fully own PT PMA for importing and exporting goods. However, a company still cannot distribute its products, which means, your company would need to assign its distributor.
The foreign ownership reduce to 67% if your business plan covers a distribution of food products. Therefore, you must have a local partner.
A local or a special purpose vehicle, also known as PT, is another kind of company that can register food products. If a local PT has even only 1% of foreign shareholders, Indonesian law considers it a foreign company.
Therefore, an Indonesian individual or a legal entity is the one who can register PT. Please note that we strongly recommend using a trustworthy local corporate vehicle such as Cekindo to sign a special purpose agreement with. This agreement will eliminate many potential risks which might occur in case you use the service of individuals.
As in every case, individual conditions to a registration of a food or beverage product apply. Generally, a company needs to submit eight documents for a registration by BPOM.
More information about food registration in Indonesia.
However, do not hesitate to consult your individual case with our professionals at Cekindo.