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Ease of Doing Business in

Indonesia

Indonesia Download Profile (2090.2KB, pdf)
Region East Asia & Pacific
Income Category Lower middle income
Population 257,563,815
GNI Per Capita (US$) 3,440
City covered Jakarta, Surabaya

190

1

DB 2017 Rank

1

100

DB 2017 DTF (% points)

  • local_library
  • group
Topics DB 2017 Rank DB 2016 Rank info_outline Change in Rank DB 2017 DTF (% points) info_outline DB 2016 DTF (% points) info_outline Change in DTF (% points) info_outline
Overall 91 106 up
15
61.52 58.51 down
3.01
Starting a Business 151 167 up
16
76.43 67.51 up
8.92
Dealing with Construction Permits 116 113 down
3
65.73 65.26 up
0.47
Getting Electricity 49 61 up
12
80.92 77.60 up
3.32
Registering Property 118 123 up
5
55.72 53.24 up
2.48
Getting Credit 62 70 up
8
60.00 55.00 up
5.00
Protecting Minority Investors 70 69 down
1
56.67 56.67
-
Paying Taxes 104 115 up
11
69.25 64.47 up
4.78
Trading across Borders 108 113 up
5
65.87 63.53 up
2.34
Enforcing Contracts 166 171 up
5
38.15 35.37 up
2.78
Resolving Insolvency 76 74 down
2
46.46 46.48 down
0.02

Positive=Doing Business reform making it easier to do business. Negative=Change making it more difficult to do business.

Viewing the data for

DB 2017 DTF (% points): 77.50

DB 2016 DTF (% points): 67.90

Change in DTF (% points): up9.60

Standardized Company
Legal form: Perseroan Terbatas (PT)
Paid-in minimum capital requirement: IDR 0
City:
Indicator Jakarta East Asia & Pacific OECD high income
Procedure – Men (number) info_outline 11.0 7.0 4.8
Time – Men (days) info_outline 22.0 23.9 8.3
Cost – Men (% of income per capita) info_outline 19.1 19.0 3.1
Procedure – Women (number) info_outline 11.0 7.1 4.8
Time – Women (days) info_outline 22.0 23.9 8.3
Cost – Women (% of income per capita) info_outline 19.1 19.0 3.1
Paid-in min. capital (% of income per capita) info_outline 0.0 12.3 9.2
  • No. Procedure Time to Complete Associated Costs
    1

    Pay fee for obtaining clearance of company name

    Agency: Notary

    The process of company name clearance must be done through a computerized processing system, the reservation and clearance is most commonly done in practice by a notary public. The notary must first pay the fee of IDR 200,000 at a bank before obtaining clearance for the proposed company name. Once the notary pays at a bank, she/he obtains a payment receipt with a code.
    1 day IDR 200,000
    2

    Obtain clearance for the company's name at the Ministry of Law and Human Rights

    Agency: Notary

    The notary inserts the code online when reserving the company name as proof of payment. The reserved name will be blocked for 60 days. If the founding shareholders are confident that the same name has not been used by another Indonesian company, this procedure is not necessary.

    Company must not use a name which:
    a. has been lawfully used by another company or is similar to the name of another company;
    b. contravenes public order and/or decency;
    c. is identical or similar to the name of a state agency, government agency, or international agency, except with their approval;
    d. does not conform to the purposes and objectives and business activities of the company, or only designates the purposes and objectives of the company without having its own name;
    e. consists of numbers or a set of figures, a letter or a set of letters that do not form any words; or
    f. means a Company, a legal entity, or a civil enterprise (persekutuan perdata).

    The Ministry of Law and Human Rights may reject a name application reservation if the requested name is, among others, the same or resembles similarities to name of other companies.

    According to Article 4 of MoLHR Reg. No. 1/2016, an electronic application must be submitted for the use of the company's name to the Ministry of Law and Human Rights ("Minister of MOLHR") through Legal Entity Administration System / Sistem Administrasi Badan Hukum ("SABH"). Such application shall be performed by filing the Company's Name Application Form which at least contains of the following information:

    a. payment number of the approval of the use of the company's name from bank; and
    b. booked name of the company.

    The approval of the company's name by the Minister of MOLHR shall be given electronically, as regulated under MoLHR Reg. No.1/2016, which at least contains of the following information:

    a. booking number of the name of the company;
    b. name of the company which may be used;
    c. date of booking;
    d. expiry date; and
    e. payment code.

    Less than one day (online procedure) included in procedure 3
    3

    Arrange for a notary to obtain the standard form of the company deed and notarize company documents

    Agency: Notary

    Government Regulation No. 43 of 2011 on Use of Names of Limited Liability Companies also provides that an application to use a name that is the same or similar to a well-known trademark shall be rejected unless approval is obtained from the holder of the trademark. Law No. 30 of 2004 concerning Notaries (Article 36 paragraph 3) stipulates that the maximum notary fee for objects of deed with an economical value of above IDR 100,000,000 up to IDR 1,000,000,000 is 1.5% of the total value of the object of the deed.
    1 day,(simultaneous with previous procedure) See procedure details
    4

    Apply to the Ministry of Law and Human Rights for approval of the deed of establishment

    Agency: Ministry of Law and Human Rights

    Based on Article 9, 10, 29 and 30 Indonesian Company Law No. 40 year 2007, the application for approval of Ministry of Law and Human Rights (the "Ministry of Law") on establishment of company can be filed electronically by attaching with the certificate of bank account and a copy of the relevant bank transmittal advice. The process will be taken as follows:
    •The application should be filled at the latest 60 days since the date of establishment deed;
    • Since the application has already fulfilled, the Ministry of Law directly electronically stated no objection on said application. However, if the application is not fulfilled, the Ministry of Law will directly electronically state his objection on said application;
    • in 30 days since the date of no objection by Ministry of Law, the applicant should submit the original application and supporting documents;
    • 14 days after fulfillment of above requirements, Ministry of Law will issue the legalization on the establishment of the company;
    • Data of company which its establishment has been approved by Ministry of Law i.e. name, domicile, object and purpose, period, Capital Company will be inserted into Company Registry.
    • The Ministry of Law will announce the establishment of company in Supplement State Gazette (TBNRI) within 14 days of the Ministry's Approval Letter.

    As of March 2014, the Ministry of Law and Human Rights issues the approval of the deed of establishment electronically.

    The cost of this procedure is based on the Schedule to the Government Regulation Number 38 of 2009 concerning Types and Tariffs on Non-Tax State Revenues Applied for in the Department of Law and Human Rights which comes into effect on 28 May 2009.
    Less than one day (online procedure) included in procedure 7
    5

    Apply for the Certificate of Company Domicile

    Agency: municipal

    All Indonesian limited liability companies must have a certificate of company domicile. This certificate is issued by the head of the village (the Lurah) where the company is located or by the building management if office space is leased. There is no official fee for this certificate. This certificate is required for tax registration (NPWP)
    2 days no charge
    6

    Pay the non-tax state revenue (PNBP) fees for legal services at a bank

    Agency: Notary

    The requirement to pay the non-tax state revenue (PNBP) fee for legal services in relation to the establishment of a PT is obtained from the information stated in the website of the Legal Entity Administration System known as SABH (Sistem Administrasi Badan Hukum) (www.sisminbakum.go.id). The obligation for the company to pay the Non Tax State Revenue/ Penerimaan Negara Bukan Pajak ("PNBP") for the legal services in relation to the establishment of the company is also stated in Article 5 of the MOLHR Reg. No.4/2014.

    The cost for the PNBP is further regulated under the Government Regulation of the Republic of Indonesia No.45 of 2014 concerning Types and Rates of Non Tax State Revenues Prevailing in the Ministry of Law and Human Rights ("GR No. 45/2014") which comes into effect on 3 June 2014.


    Cost breakdown:
    1,000,000 IDR for validation of company as legal entity
    30,000 IDR for publication in State Gazette
    550,000 for publication in the Supplement State Gazette
    1 day See procedure details
    7

    Apply at the Ministry of Trade for the permanent business trading license (Surat Izin Usaha Perdagangan, SIUP) and the company registration certificate (Tanda Daftar Perusahaan/TDP) from the BPTS- OSS for Jakarta

    Agency: One Stop Integrated Service Body of SKI Jakarta Provincial Government - Ministry of Trade

    The Surat Izin Usaha Perdagangan (SIUP) constitutes the business license for a non-facility company engaging in trading business. The SIUP contains details about the company activities and the person in charge of the company (normally the President Director). The Ministry of Trade, which issues the SIUP for a non-facility company, may require a letter of good conduct from the Indonesian police in support of the person in charge of the company. Normally, the following copy of documents should be attached for the application for a SIUP:

    • The articles of association (copy).
    • An attestation of location and address of the company’s offices (building management domicile certificate and certificate of company domicile).
    • Identity card of the company President Director.
    • Letter of approval from the Ministry of Law and Human Rights
    After reviewing the application, the Municipality passes it to the technical agency at the regional office for cooperatives for further review• it takes 2 days to get the signature of the head of that office as the authority is not delegated. Once the application is back, the SUIP is provided.


    The Trade Minister Regulation No. 36/M-DAG/PER/9/2007 as amended by the Trade Minister Regulation No. 46/M-DAG/PER/12/2011. There are no changes to Article 3 under this new regulation. classified the SIUP based on the enterprises’ net assets as follows:

    Article 3
    (1) Small Scale SIUP must be held by businesses engaging in trade having a net asset of more than Rp. 50.000.000,- (fifty million Rupiah) up to no more than Rp. 500.000.000,- (five hundred million Rupiah) not including land and building on which the business operates;
    (2) Medium Scale SIUP must be held by businesses engaging in trade having a net asset of more than Rp. 500.000.000,- (five hundred million Rupiah) up to no more than Rp. 10.000.000.000,- (ten billion Rupiah) not including land and building on which the business operates;
    (3) Large Scale SIUP must be held by businesses engaging in trade having a net asset of more than Rp. 10.000.000.000,- (ten billion Rupiah) not including land and building on which the business operates.

    As of February 2016, the application for SUIP and TDP have merged into one application in Jakarta. The OSS (BPTS) has the authority to review the application and issue the approval either online or in person. Once the founder returns to the one-stop shop they will receive two separate registration documents.
    7 days no charge
    8

    Register with the Ministry of Manpower

    Agency: Ministry of Manpower

    Pursuant to Article 6 of the Law No.7 of 1981 concerning Mandatory Labor Affairs Report ("Law No.7/1981"), the company shall be obliged to submit a manpower report in the company to the Ministry of Manpower and Transmigration ("Minister of Manpower") or the appointed officer within a period of no more than 30 days as of the establishment of the company. Such report shall contain the following information:

    a. company identification;
    b. manpower relation;
    c. manpower protection; and
    d. employment opportunity.

    The provision regarding the manpower report in the company is further governed under the Regulation of the Ministry of Manpower and Transmigration of the Republic of Indonesia No.PER.14/2006 concerning the Guidelines for the Manpower Report in the Company ("MoMTR No.14/2006"). Pursuant to Article 2 of the MoMTR No.14/2006, the manpower report must be submitted in the form of electronic data compiled in the Company's Manpower Database in the Information System on Company's Manpower Mandatory Reports / Sistem Informasi Wajib Lapor Ketenagakerjaan di Perusahaan ("SINLAPNAKER"). The company which make a use of the Sinlapnaker shall be given an Identity Card from the Directorate General of Development of Labor Supervision.

    In the event that the region of the company has not yet installed SINLAPNAKER, the report must be submitted in writing and delivered by hand or by registered mail to the government institution having tasks and responsibility in the field of manpower in the Municipality/City where the company is located in accordance with the procedure as stated in Article 5 of the MoMTR No.14/2006. Further, in order to increase the service of the implementation of mandatory labor affairs report, the Minister of Manpower issues the Circular Letter of the Ministry of Manpower and Transmigration of the Republic of Indonesia No.SE.3/MEN/III/2014 concerning the Implementation of Mandatory Labor Affairs Report in the Company ("MoMTCL No.3/2014").

    Time: ratification of the registration of mandatory labor affairs report in the company shall be performed within a period of 1 working day as of the receipt of complete application (signed which has been filled in complete and signed with the company stamp (MoMTCL No. 3/2014).

    Cost: the registration of the mandatory labor affairs report shall not be subject to any fee(s) (MoMTCL No.3/2014).
    1 day no charge
    9

    Apply for the Workers Social Security Program (BPJS Ketenagakerjaan)

    Agency: Social Security Administrative Bodies (BPJS Ketenagakerjaan)

    The Presidential Regulation No. 109 of 2013 on Membership Phasing of Social Security Program regulates that BPJS Ketenagakerjaan covers occupational accident security, old age security, pension security, as well as death security. Under this regulation, every employers have the obligation to register their workers to BPJS Ketenagakerjaan based on their business scale starting from 1 July 2015, which are as follows:

    1. Big and medium business scale to participate on programs including occupational accident security, old age security, pension security, and death security program;
    2. Small business scale to participate on programs including occupational accident security, old age security, and death security program; and
    3. Micro business scale to participate on programs including occupational accident security and death security.

    The company shall obtain application forms (form 1 for data and form 1A for employees’ data) at the nearest BPJS Ketenagakerjaan office (list of BPJS Ketenagakerjaan in DKI Jakarta: http://www.bpjsketenagakerjaan.go.id/kanwil/903/KANWIL-DKI-JAKARTA.html). The application forms shall be submitted to the BPJS Ketenagakerjaan at the latest 30 (thirty) days after obtaining application forms with following attachments: receipt of first contribution payment, SIUP, company’s NPWP, Deed of Establishment, and employees’ National Identity Card, Photograph, and Family Registration Card. After 7 (seven) days of the submission, BPJS Ketenagakerjaan will issue the membership card and certificate of registration. If there is any changes on the company’s address, business activity, and the amount of employees, as well as employee’s wages, at the latest 7(seven) days following to such changes, the employer is obliged to convey it to BPJS Ketenagakerjaan.


    7 days no charge
    * 10

    Apply for healthcare insurance with BPJS (Badan Penyelenggara Jaminan Sosial) Kesehatan 

    Agency: Social Security Administrative Bodies (BPJS Kesehatan)

    Manual registration is performed by completing the registration form and providing the data of future participants to BPJS Health or through appointed third parties, and then completing the form and submitting the personal data of the participant candidates.

    During application, the employer must provide at least the following personal data of the candidate participants:

    - Name;
    - Date of birth;
    - Name of the health service provider selected by the employee; and
    - Other personal information, including:

    • Employee and his/her family member(s), who will be covered by the health insurance program;
    • Employee’s salary information;
    • Information on participation status

    7 days (simultaneous with previous procedure) no charge
    * 11

    Obtain a taxpayer registration number (NPWP) and a VAT collector number (NPPKP)

    Agency: Tax Office

    Regulation of Directorate General of Taxation No. Per- 38/PJ/2013 concerning Procedures of Application of Taxpayer Registration and/or Taxable Entrepreneur Number, Amendment of Data and Transfer of Taxpayer and/or Taxable Entrepreneur aimed to enhance the service to the taxpayer. The regulation states that within 1 year as of the issuance of NPWP, the relevant Tax Office will conduct field confirmation regarding the correct data/identity of the taxpayer.

    The person/entity can apply for NPWP in the relevant tax office where the company is located or can apply it online through http://www.pajak.go.id, choose e-registration to make account as a taxpayer and then follow the procedures therein, by filling the form and attaching copies of the following

    - Deed of establishment
    - Identity card/KTP of one of active Director
    - Statement letter regarding confirmation on place of business from one of the active Director (form is provided),
    - POA and identity card/KTP of the authorized.

    The NPWP card and Registered Statement Letter is obtained within 1 calendar day upon the completeness of the required document without and fee, charge and/or retribution.
    1 day (simultaneous with previous procedure) no charge

    * Takes place simultaneously with previous procedure.