Home Blog Update from BKPM: Three-Hour License Service For Energy Sector Business Licenses | Business Setup | Legal Updates Update from BKPM: Three-Hour License Service For Energy Sector InCorp Editorial Team 14 February 2017 3 minutes reading time Table of Contents The Nine Types of Operations The Difference between the Regular Licensing Process and three hour license service The Administrative Requirements Three-hour licensing procedure was issued by Indonesian Investment Coordinating Board (BKPM) on January 30, 2017. This is a good news for foreign investors related to energy and mineral resources. This rapid licensing procedure is for nine types of operations (eight of which are for oil and gas sectors and one of them is for electricity procurement industry). The Nine Types of Operations The nine types of operation in the field of energy sectors that are served by the three-hour licensing service include: LPG (oil, fuel, liquefied petroleum gas) Temporary business license CNG (storage of processed products or compressed natural gas) Temporary business license LNG (liquefied natural gas) Temporary business license Oil residue processing industry Temporary business license General trade of oil and fuel Temporary business license Trade of processed products Temporary business license Oil refining Temporary business license Natural gas processing, Temporary business license Electricity procurement industry Temporary business license The Difference between the Regular Licensing Process and three hour license service This new system is to boost the investment in Indonesian energy sectors because similar licenses usually take between 20 to 45 business days to complete if finish through the regular service in BKPM—which often requires companies to deal with complicated bureaucracy systems. This is often considered overwhelming, especially when there is some error in the documents as the company has to start the process from the very first step due to the unavailability of license or document revision policy. Read also: Company Registration in Indonesia Business License in Indonesia What You Should Know About the Latest Land and Building Tax Regulation The Administrative Requirements The issuing of the three-hour license service is an effort by the government of Indonesia that expects to improve foreign investment in this field. Although it is also said that investors may still experience several challenges, including the transportation and difficult topography in Indonesia that make the transportation and distribution cost becomes extremely expensive. Infrastructure is also to be another obstacle that need to improve by the government. However, this government’s attempt to cut the bureaucracy procedure in licensing, especially in the energy sector wants to be a fresh air for the foreign investors. Check more updates from BKPM: OSS System Services Begin to Operate at BKPM Companies of those nine categories can obtain the licenses if they can fulfill all of the documents and technical requirements that are set to be the administrative requirements. This written in the Decree No. 15/2016. Issued by the Ministry of Energy and Mineral Resources. This concerning the three-hour licensing service. Especially for infrastructure in the field of energy and mineral resources. How Cekindo Can Help You Cekindo has assisted many companies in setting up their businesses in Indonesia. Cekindo can help you to prepare every documents needed so that you can take the benefits of this three-hour licensing service.Cekindo can help you starting from the initial preparation of the prerequisite documents up to the final issuing of the licenses. Cekindo is also willing to answer all of your questions related to the Indonesian policies concerning the foreign investment in energy sectors. Please contact us for more details or simply leave your comments under the article. Our professional team will assist you further. 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 How much is the minimum fund required to establish a PT PMA business in Indonesia? The investment requirement for PMA companies in Indonesia varies based on their classification under the Indonesia Industrial Standard Classification (KBLI). Generally, a minimum investment of IDR 10,000,000,000 (ten billion Indonesian Rupiah), excluding investment in land and buildings, is needed to conduct one business activity in one location. What if my product has been registered under a local distributor, and I decide to transfer the license to my company or another distributor? You can transfer the license if your local distributor agrees to change the product license holder. 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. What requirements are needed if my Indonesian company registers the product? Register the product with BPOM (National Agency of Food and Drugs) and MoH (Ministry of Health). The type of testing and document requirements depend on the type of product you want to register. Also, the time frame for registration could vary between 3 to 15 months. Get in touch with us. 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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. More on Business Licenses F&B Services’ Compliance in Indonesia: Tending to Clipped Wings Read more Invest in Industrial Parks in Indonesia and Your Business Will Grow Read more Interested in Setting up a Local Company in Brebes? 5 Facts to Know Read more