ESG In Action: Indonesia’s OSS System Transitions Company Licensing Requirements From Business-Based To Risk-Based.

Risk Level

Business Licensing Documents

Requirements and Process

Low risk

Business Registration Numbers (Nomor Induk Berusaha – “NIB”), which will also serve as Indonesian National Standards (Standar Nasional Indonesia/SNI) and/or halal guarantee statements on business activities with low level of risk  carried out by micro- and small-scale businesses.

The OSS system will automatically issue an NIB once the required data have been submitted, for commencement of business.

Medium-low risk

• NIB; and

• Standard certificates, in the form of independent statements on compliance with business activity implementation standards submitted via the OSS System.

After submitting data and information to obtain an NIB, both the NIB and standard certificates can be obtained by:

• submitting a statement that confirms their readiness to fulfill the standards in the implementation of their business activities; and

• completing forms on environmental management efforts and environmental monitoring efforts (upaya pengelolaan lingkungan – upaya pemantauan lingkungan – “UKL-UPL”) or submitting statements of environmental management and monitoring undertaking (surat pernyataan kesanggupan pengelolaan dan pemantauan lingkungan hidup – “SPPL”), whichever is applicable.

Medium-high risk

• NIB; and

• Standard certificates for the implementation of business activities issued by the central government or regional governments in accordance with their respective authority and based on the results of verification of the compliance with standards of business activity implementation by business actors.

After submitting data and information to obtain an NIB, business actors must:

• obtain both the NIB and standard certificates with “unverified” marks by completing UKL-UPL or SPPL forms, whichever is applicable; and

• meet the NSPC applicable to their business sectors, which will be further verified by the relevant authorities so that the standard certificates will receive “verified” marks.

High risk

• NIB;

• Licenses, which comprise approvals granted by the central government or regional governments to carry out business activities and must be obtained by business  actors before starting any business operation; and

• Standard certificates for products or business activities (if applicable).

 After obtaining an NIB, business actors must:

• fulfill the relevant licensing requirements in accordance with the applicable NSPC before conducting any operational and/or commercial activity;

• upload a statement on their fulfillment of the requirements via the OSS system. The statement will then be verified by the relevant authorities to issue a license.

Preparatory stage

• The various preparatory activities outlined above, specifically: procurement of land, construction of buildings and/or procurement of equipment and/or facilities;

• Procurement of human resources;

• Fulfillment of business standards; and/or

• Other measures implemented prior to the operational and/or commercial stage.

Operational and/or commercial stage

• Production, logistics and distribution, and/or marketing of goods/services; and/or

• Other operational and/or commercial activities.