Indonesia

Indonesia

Integrates business licensing processes into Online Single Submission system

05 Jun 2025

On 5 June 2025, Indonesia issued Government Regulation No. 28 of 2025 (GR 28/2025), replacing Government Regulation No. 5 of 2021 (GR 5/2021). The regulation integrates all business licensing processes into the existing Online Single Submission (OSS) system. The enhanced OSS comprises three subsystems: the Basic Licences Subsystem, the Foreign Investment Facilities Subsystem, and the Partnership Subsystem.

Throughthe integrated OSS, foreign investors may apply not only for business licences but also for investment incentives(e.g. import duty exemptions, corporate income tax reductions (tax holidays), total income deductions related to internship, training and education programmes, and other investment incentives).

The amendment also introduces the 'Fictitious Positive Principle', under which, where a government authority fails to act within the prescribed timeframe, the relevant approval or licence is deemed to have been granted.

The regulation also expands the risk-based licensing framework remains from 16 to 22 business sectors, including investment. Details of the risk-based licensing framework are set out in the IPM database (see: https://investmentpolicy.unctad.org/investment-policy-monitor/measures/3713/indonesia-introduced-risk-based-business-licensing).

The regulation came into force on 5 June 2025, with a transition period for system adjustments running until 5 October 2025.

Nature of measure:
  • Facilitation
Type:
  • Entry and establishment (Approval and admission - other)
  • Promotion and facilitation (Investment facilitation )
Industry:
  • Not industry specific
Inward FDI:
Yes
Outward FDI:
No
Sources:

  • The Investment Policy Monitor provides the international investment community with up-to-date, country-specific information on recent policy developments affecting foreign direct investment (FDI).

    Through its ongoing monitoring of investment policy changes, UNCTAD delivers cutting-edge and forward-looking contributions to investment policy discourse. The Monitor also supports evidence-based policymaking aimed at ensuring that foreign investment contributes to sustainable development. The Monitor also informs the analysis of global and regional investment policy trends featured in the World Investment Report, the Investment Policy Monitor publications and the joint UNCTAD-OECD Reports on G20 Investment Measures.

    UNCTAD has tracked changes in national policies affecting FDI on an annual basis since 1992. Over time, the methodology has been revised to enhance the quality and consistency of reporting. The most recent revision, completed in 2024, further refined the monitoring framework and applied the updated classification to policy measures dating back to 2012.

  • UNCTAD Investment Policy Monitor

    The UNCTAD Investment Policy Monitor database compiles official measures affecting FDI adopted by United Nations Member States. These encompass measures explicitly targeting foreign investment (FDI-specific), as well as general investment measures that have a clear impact on such investment (FDI-related).

    The measures are either reported directly to UNCTAD by Member States through annual surveys or identified by UNCTAD researchers through publicly accessible sources (such as government websites and specialized policy databases).

    The classification of measures as more or less favourable to investors is based solely on their potential impact on investors. The type of measures included in each category are described below. This classification does not reflect any value judgement by UNCTAD on the merit or suitability of the measure.

    Classification of the nature of measures

    More favourable to investors

    Liberalization: includes privatization; lifting of entry restrictions (e.g. opening of sectors to FDI) and entry conditions (e.g. minimum capital requirement); removal (total or partial) of FDI screening or approval mechanisms; lifting of foreign exchange restrictions; liberalization of land access.

    Facilitation: includes streamlining of investment procedures (e.g. one-stop shops); greater transparency of investment-related laws and procedures (e.g. information portals); introduction by IPAs and other entities of new services to assist investors (e.g. linkages programmes, investor visa facilitation or alternative dispute resolution mechanisms).

    Promotion: includes establishment of IPAs or other institutions with a remit as investment promoters and expansion of their mandate; adoption of investment promotion strategy and plans; introduction of PPPs, auctions, and concessions initiatives or framework; introduction of OFDI promotion initiatives.

    Incentives: includes adoption of new tax and financial incentives schemes for investment; introduction of other incentives (e.g. citizenship by investment programmes); adoption of new SEZ-related incentives.

    Other regulatory changes: includes enhancement of investor treatment and protection guarantees; easing of labour or migration regulations concerning foreign hires and key personnel; removal of operational restrictions on investment (e.g. local content requirements).

    Less favourable to investors

    Entry: includes introduction or tightening of entry restrictions (e.g. total or partial ban on FDI in specific sectors); introduction or tightening of entry conditions (e.g. minimum investment threshold, joint venture requirements or State participation in strategic sectors); introduction or expansion of screening mechanisms for national security.

    Treatment and operation: includes introduction or expansion of foreign exchange restrictions; introduction or expansion of restrictions on foreign hires and key personnel; removal or reduction of investment incentives; introduction or expansion of post-establishment requirements for local content; reduction of guarantees for investment treatment and protection; introduction or expansion of restrictions on OFDI.

    Note: Measures are verified, to the fullest extent possible, by referencing government sources. The compilation of measures is not exhaustive.

    Disclaimer: the boundaries and names shown and the designations used on this map do not imply official endorsement or acceptance by the United Nations.

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