As we explained in one of our Articles, BKPM Updates Investment License Regulations, we understand that BKPM has issued 4 (four) new regulations as part of the Indonesian Government’s Economic Stimulus package. One of them is Head of BKPM Regulation No. 14 of 2015 concerning Investment Principle License (“BKPM Regulation No. 14/2015”).
One of the most important content of BKPM Regulation No. 14/2015 is the introduction of Izin Investasi, literally meaning “Investment License”. This new license is intended to facilitate large-scale investment and to encourage investment in industrial areas. In order to further promote the license to investors, BKPM states that the processing period of an Investment License will only take 3 (three) hours, with a Direct Construction Permit.
Not every company can apply for Investment License. An Investment License is a principle license which only applies for PMA or PMDN Companies with minimum total investment above IDR100,000,000,000 (one hundred billion rupiahs), and will employ at least 1,000 (one thousand) employees. Companies with lower investment must apply for a regular Principle License (Izin Prinsip).
The difference between an Investment License and a regular Principle License:
|INVESTMENT LICENSE||PRINCIPLE LICENSE|
|Minimum Investment of above Rp 100.000.000.000,- (applies for both PMDN and PMA Companies)||Minimum Investment of above Rp 10.000.000.000,- (applies only for PMA Companies)|
|Application submitted Directly by Investor/Shareholder at BKPM Central Office||Application submitted Online at BKPM System (SPIPISE)|
|Issued 3 hours after BKPM receives complete and correct application||Issued at the latest 3 (three) working days after BKPM receives complete and correct application|
Based on the latest Press Release from BKPM on December 1, 2015, the Investment License application service that is provided by BKPM will contain no less than 8 (eight) license products including the Investment License itself and 1 (one) certificate for land blocking.
The 8 (eight) license products processed in Investment License Application Service:
To simplify the licensing process, BKPM has made the effort to provide a complete set of service for investors, from executing the incorporation documents of the company, and even to provide the working permits for expatriates hired by investors. The consequence of this is that BKPM can only process the application for Izin Investasi when Investors have brought all the required documents to apply for the license products. That includes required documents to apply for Expatriate Work Permits and Producer Importer’s Identification Number, aside from the standard corporate documents such as Deed of Establishment and Domicile Certificate.
On December 3, 2015, BKPM released another press release stating that 3 (three) PMA Companies and 1 (one) PMDN Company has applied using the Investment License application service. BKPM also explained that the 3-hour application service for all 8 (eight) license products at BKPM is divided into 4 (four) phases, each with the duration of 45 minutes maximum.
HOW CAN SMART LEGAL CONSULTING HELP YOU?
SMART Legal Consulting has extensive experience in assisting Investors to incorporate by Establishing PMA Companies, and continue their compliance in Indonesia in regards to the investment requirements set by BKPM. We can provide assistance to Investors to compile the required documents for investment license applications. If you need immediate assistance, please contact the SMART Help Desk at: