Business License Application in Indonesia
A Guide to Applying for the Licenses You Need to Conduct Business
Obtaining a business licence in Indonesia is a mandatory step for all companies, regardless of size or sector. The process is now centralised through the Online Single Submission – Risk-Based Approach (OSS-RBA) system, which streamlines licensing based on business risk levels.
To begin, companies must be legally established with a Deed of Establishment approved by the Ministry of Law and Human Rights (MOLHR), register for a Tax Identification Number (NPWP), and secure a Business Identification Number (NIB). The NIB serves as the foundation for obtaining the necessary business and commercial licenses, ensuring compliance with Indonesian regulations.
What are the Requirements of a Business License Application in Indonesia?
As of June 5, 2025, Regulation No. 28 of 2025 (GR 28/2025) has become the primary regulation governing risk-based business licensing in Indonesia, superseding Government Regulation No. 5 of 2021.
Under GR 28/2025:
- Businesses are categorised by risk level (Low, Medium-Low, Medium-High, High), and the documentation and licensing requirements depend on that classification.
- Basic Requirements (Persyaratan Dasar) must be fulfilled. This includes the Deed of Establishment, Ministry of Law & Human Rights’ (MOLHR) approval, and classification of business activity under the KBLI system.
- All licensing and operational approvals (environmental, technical, etc.) are increasingly processed electronically through the OSS platform.
- Service Level Agreements (SLAs) are now enforced, with defined timelines for assessments and approvals. If agencies do not act within these timelines and the application is complete, the license may be deemed granted (i.e., a fictitious positive).
- For PT PMA (foreign-owned companies), the minimum investment requirement remains IDR 10 billion (excluding land/buildings), and documentation around investment plans and KBLI activity classification is required.
Types of Licenses in Indonesia for Businesses
Indonesia has several types of licensing options to choose from:
- Normal business license (general trading of goods and services)
- Industrial manufacturing licenses (not including thermal energy, gas, and oil)
- Food and beverage license
- Food supplement distribution license
- Construction business license
- National Agency of Drug and Food Control (BPOM) and a medical distribution license (if you intend to sell medical devices)
- Cosmetic distribution license (if you intend to sell and distribute cosmetic products)
The OSS RBA Application Process in Indonesia
The OSS RBA (Online Single Submission – Risk-Based Approach) system classifies businesses according to risk levels, which determines the complexity of the licensing process.
Step 1: Company Registration via MOLHR
- A notary must draft and certify the company’s Deed of Establishment.
- The deed is then submitted to the Ministry of Law and Human Rights (MOLHR) to obtain legal entity approval.
- The OSS system is integrated with MOLHR to verify the company’s registration details.
Step 2: Create an OSS RBA Account
- Register an account on the OSS portal (oss.go.id) using the data from the MOLHR-approved company deed.
Step 3: Obtain Your Business Identification Number (NIB)
- Once registration is complete and all corporate data are submitted, the OSS system automatically issues an NIB.
- The NIB serves multiple purposes:
- Company Registration Certificate
- Importer Identification Number
- Customs Rights Access
- Registration for Indonesia’s health and social security programs (BPJS)
- Company Registration Certificate
Step 4: Secure Business and Commercial Licenses Based on Risk
- After obtaining the NIB, businesses can apply for additional licenses according to their KBLI code and assessed risk level:
- Low-Risk Businesses: Only the NIB is required to begin operations.
- Medium/High-Risk Businesses: Require the NIB and a Standard Certificate, a self-declared compliance statement submitted via the OSS system.
- High-Risk Businesses: Require the NIB, a Business License, and a Commercial/Operational License. Specific commitments—such as environmental, location, or building permits—must be fulfilled before the license becomes effective.
- Low-Risk Businesses: Only the NIB is required to begin operations.
Step 5: Fulfil Post-Licensing Requirements
- High-risk businesses must complete the required commitments within a specified timeframe.
- Once these requirements are met, the OSS system or the relevant government authority will issue the effective business license, allowing legal commencement of commercial operations.
What are the Documents Required for a Business Licence Application?
To proceed with the business application process, you must prepare the following documents:
- A copy of the ID and passports of all foreigners for the visa application.
- A copy of all permit approvals granted at the investment stage.
- A copy of your deed of establishment and Ministry of Law and Human Rights (“MOLHR”) Approval
- A copy of your deed of amendments and each MOLHR Approval
- A copy of your domicile which is still valid
- A copy of your NIB (including Izin Lokasi & Izin Usaha)
- A copy of your office rental contract (where your business office will be based).
- Complete list of industrial and office equipment for your business.
- Organisational structure of your business.
Business licenses will generally be issued within 14 days if all your documents are in order. Your license will be valid for 30 years unless otherwise stated.
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