LICENSING PROCEDURES IN IMPLEMENTATION STAGES

To implement an approved investment project, BKPM or BPM or Investment Institution in Regency / Municipality will issue the following permits / licenses as proposed by the investors: customs approval letter, limited importer license (PAIT), foreign manpower plan approval (RPTKA), permanent business license (IUT) on behalf of the sectoral ministries concerned. Especially for expatriate work permit (IKTA) issued by BPM or Investment Institution in Regency/Municipality. In addition to the above approvals, the local government of the second level regions will issue regional permits such as: location permit, building construction permit, nuisance act permit, land title.

1. The Procedure for Filling the Application for Approval of the Articles of Association of a Limited Liability Company. o The application for approval of the articles of association of a limited liability company shall be registered by founders or their proxy to the Minister of Law and Legislation through the Director of Civil Affairs, with the following attachments a. (one) copy of the duty-stamped articles of association of the company and the duty-stamped amendment to the articles of association of the company (if any), drawn up according to the relevant standards Data on the articles of association, drawn up and signed by a notary on duty-stamped papers. b. The evidence of paid-in capital from the banks concerned c. A copy of the tax-payer registration number of the company d. Evidence of an advance payment for the announcement of the articles of association of the company in the supplement to the State Gazette from the State Printing Press e. The evidence of payment of non-tax state revenue (PNPB) fees for legal services pursuant to the Decree of the Minister of Justice No. M.01UM.01.06/1993 f. A copy of the capital investment approval letter by BKPM specifically for limited liability companies with capital investment facilities g. A copy of the principle license for the establishment of a bank issued by the Minister of Finance, especially for limited liability companies (PT) engaging in the banking sector h. A letter of recommendation from the Directorate General of Radio, Television and Films, Ministry of Information, especially for limited liabilities companies engaging in non-government radio broadcasting i. A letter of recommendation from the Ministry of Cooperatives and SmallScale Business Development or the regional office of the Ministry of Cooperatives and Small-Scale Business Development or the office of the Ministry of, Cooperatives and Small-Scale Business Development for companies in which one of founders is a cooperative unit j. Advertisements in 2 (two) daily newspapers announcing the payment of shares other than money k. Other documents required pursuant to the relevant laws in force

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Documents as intended in points d, g and h shall be acknowledged and signed by the notary concerned as proof of their conformity with original papers. Within a maximum period of 60 (sixty) days starting from the date of receipt of the application for validation of the articles of association, the Minister of Law and Legislation shall grant approval or reject the application for approval.

2. Tax-payer Registration Number (Nomor Pokok Wajib Pajak / NPWP) and Taxable Entrepreneur Confirmation Number (NPPKP) Application Procedures o The-tax-payer shall be any individual or organization, which according to Tax Laws is required to meet tax obligations, including certain tax collectors or tax with holder. o Every business / company subject to tax on the basis of the Value Added Tax law of 1984 shall be obligated to report his / its business to the office of the Directorate General of Taxes in the operational area of which he resides or it is domiciled, and the place of business activities, for confirmation as a taxable business / company also referred to as Pengusaha Kena Pajak (PKP) and shall be granted taxable confirmation number also referred to as Nomor Pengukuhan Pengusaha Kena Pajak (NPPKP). o The PMA company concerned shall be required to fill out tax-payer registration form and submit it to the tax-payers service office through the post office, with the following attachments

a.

For Tax-payer. 1. A copy of the Articles of Association of the joint venture company. 2. A copy of Identity Card of one of the companies share holders. 3. A copy of Business Operation License or letter of recommendation on business location from the corresponding government office.

b.

For treasurer collecting tax : 1. A copy of appointment letter as a treasurer. 2. A copy of Identity Card / Family Card/Drivers license/ Passport

Customs Facilities Procedures.

The PMA company shall be required to submit a masterlist for its imported capital goods namely machinery, equipment and raw material to BKPM / BPM or Investment Institution in regency / municipality through PT SUCOFINDO, with the following attachments: a. Application Letter. b. Master list. c. A copy of investment approval. d. Equipment Lay-out Drawing. e. Technical Brochures / Technical Literature. f. A copy of NPWP. g. A copy of NPPKP. h. Production Process Flow-Chart i. Capacity Calculation SUCOFINDO will evaluate the master list in terms of their compliance with the conditions and requirements of the investment approval and the result of evaluation will then be sent to BKPM / BPM or Investment Institution in regency / municipality. Based on the SUCOFINDO evaluation of the master list applications, the BKPM/BPM or Investment Institution in Regency / Municipality will legalize the application and issue a customs approval letter (Surat Persetujuan Pabean) exempting import duties in the items listed on the letter. The raw material (needed for 2 years accumulated production time) may only actually be imported after at least 75% of the machinery are installed.

Limited Imported License Procedures (APIT) o Foreign investment companies intending to handle the import of capital goods and / or raw materials / supporting materials by themselves shall have the identification number of limited imported which is also called Angka Pengenal Importir terbatas (API1J. o The application for APIT is to be submitted to BKPM / BPM or Investment Institution in regency / municipality with the following attachments a. The Identification Number of Limited Importer Card signed by the competent person entitled to sign import documents and adhered company seal. For the document signer other than directors, it requires the proxy statement from the directors on seal. b. Copy of Articles of Association / the last cooperative by-laws as organization / cooperative organization structure. c. Copy of Tax-payers Registration Number (NPWP) for new Foreign Investment company. d. Copy of Work Permit for Expatriates signing the importer document concerned. e. List of names of persons entitled to sign import documents with 1 (one) passport size photo each;

f. Copy of approval of domestic investment or approval of foreign investment and approval of investment modification. 3 4 Expatriate Work Permit Procedures. o To apply for work permit for its expatriate (Ijin kerja Tenaga Asing / IKTA), the PMA company should first submit manpower plan approval (Rencana Penggunaan Tenaga Kerja Asing / RPTKA) application to BKPM or Investment Institution in Regency/Municipality with the following attachments: a. Indonesian Co-Manpower Utilization Plan including education levels, job experiences and education and training program. b. Copy of Investment approval showing number of approved expatriates. c. Copy of the current Articles of association / cooperative by-laws as to the organization / cooperative structure. d. Copy of the current Investment Activity Report (Laporan kegiatan Penanaman Modal/LKPM) or Annual Report (A.3) for Regional Representative Office. e. Especially for positions in mining and energy, oil and natural gas sub-sector and medical treatment service, advised to attach recommendation from Director General Concerned. f. Especially for the application for RPTKA renewal / addition / modification: Copy of the former RPTKA approval Reasons and report of the Indonesian Manpower Education Training program implementation 3. Proof of Manpower Report ratified by the local office of the Department of Manpower.
1. 2.

2 The BKPM/BPM or Investment Institution in Regency/Municipality (RPTKA) to the PMA company and its copies to the Minister of Manpower, concerned sectoral ministries and the BPM or Investment Institution in regency/municipality by filling out a Form of Ppt.2, with the following attachments :
a. b. c. d. e. f. g. h.

Copy of valid passport of the subject expatriate The current Curriculum Vitae signed by the expatriate concerned (original). Copy of certificate and/or education certificate and join references in English or translation into Indonesian Language. Copy of Article of Minutes of the General Meeting of Shareholders as to the appointment for position as Director. Copy of job contract between Expatriate(s) and company. Copy of the effective RPTKA approval. Copy of the current Investment Activity Report (LKPM) or Annual Report A.3 for I Regional Representative Office. Copy of Indonesian Co-Manpower valid Identification Card and Decree of his or her appointment as worker.

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After the Ppt.2 is evaluated, The BKPM/BPM or Investment Institution in Regency / Municipality will issue a letter of recommendation in form of TA.01 to the Director General of Immigration. Based on the TA. 01 recommendation, The Directorate General of Immigration will send a telex to the Indonesian Representative Office overseas to issue the Limited Stay Visa (VITAS) to the expatriate concerned. On the basis of the Limited Stay Visa (VITAS), the expatriates concerned shall be allowed to enter Indonesia and to proceed to the location of the project. For expatriate who has entered Indonesia, a work permit for expatriate (IKTA) is required. To apply for IKTA, the PMA company concerned is required to submit an application to BPM or Investment Institution in Regency / Municipality. The Chairman of the BPM or Investment Institution in regency / municipality authorized by the Chairman of the BKPM for this task, shall issue the IKTA on behalf of the Minister of Manpower within 4 (four) days.

Visa Application Procedures o Visa application should be submitted to the Visa Section at the Directorate General of Immigration. o Visa application should be submitted along with requirements as follows : a. Valid passport. b. Round trip ticket to proceed to the country of destination c. 2 (two) photographs of the size 6 x 4 cm. d. Proof or guarantee of sufficient funds for living expenses while staying in Indonesia. e. Visa fee payment. o Visa application should be approved if the foreign national concerned : a. has fully complied with the requirements b. has paid the visa fee c. is not included in the black list. o Visa application should be refused if the foreign national concerned : a. has not fully complied with the requirements. b. is known to be or suspected of being involved in international criminal syndicated activities. c. is suspected of having committed action conflicting with national security, public order morality, religion, or traditional customs of the people of Indonesia. d. is found to be suffering from a mental illness or a contagious disease hazardous to public health.

e. originates from a country which has no diplomatic relations with the Republic of Indonesia, unless otherwise stipulated by the Decree of the Minister of Law and Legislation.

Visit Visa
a.

Visa Provisions Government official visit Tourist visit Socio-cultural visit Business visit, covering business activities, such as to discuss matters in the context of trade transactions, to observe on the spot and discuss, and to provide consultation, guidance, information and training in applying innovations, etc. Validity of Visit Visa 90 (ninety) days from the date of issuance Validity of Visit Permit 60 (sixty) days from the date admission to Indonesia Requirements In possession of passport or travel document valid for at least 6 (six) months to conduct a show, trade, professional sport, seminar or to give a commercial lecture, medical treatment and trial test of a work instrument may be carry out upon approval of the related authorities. Immigration fee US$ 25,00 per person.

b. c. d.

e.

Limited Stay Visa and Permit a. Visa and Permit Provisions Limited stay visa shall be issued to foreign nationals for the purpose of foreign investment, employed as expatriate for the government or private sector, for education and training, or scientific research, to joint husband and or parent and family united with wife and legitimate child (ren) under age and single. Limited Stay Permit shall be issued to foreign nationals for the purpose of staying in Indonesia. b. Validity of Limited Stay Visa 90 (ninety) days from the day of issuance c. Validity of Limited Stay Permit For a maximum of 1 (one) year, from the date of arrival in Indonesia, and extendible for a maximum of 5 (five) years consecutively. d. Requirements for Visa and Limited Stay Permit

In possession of passport or travel document valid for at least 18 (eighteen) months. Recommendation by an overseas local sponsor or Indonesian sponsor. Applicants wishing to join husband or parent who is the citizen of Indonesia / foreign national holder of limited stay permit, are required to enclose marriage certificate and or birth certificate. Applicant conducting activities in the field of religious mission, research, social and education, should enclose copies and original of recommendation letter from related institutions / technical departments. Applicant to be employed in the context of foreign investment / domestic investment (PMA / PMDN) or employed as expatriate in the context of overseas technical aid, should enclose recommendation letter from the sectoral department and the Department of Manpower / The Investment Coordinating Board (BKPM) and approval of plan to utilize foreign manpower (RPTKA) e. Immigration Fee US$ 40,00 per person, for limited stay visa. Rp. 125.000 per person for limited stay permit.

Location Permit Procedures.

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As it is known, a location license is one of the requirements for a company to obtain land in the context of investment. The purpose of this condition is to direct and control companies in obtaining land because the control over land must take into account the interests of the people at large, and the utilization of land shall be in inline with the space layout planning in force and the physical potential of the land itself. The land designated in the location license shall be a plot of land having an area already approved in the investment for implementation of the investment as planned. Nevertheless, it is necessary to consider the aspect of land control in the area concerned and the conditions of its utilization. If it is impossible to obtain as large a land as that mentioned in the investment agreement, the location license can determine a smaller area, or to move to other suitable area. The holder of the location license shall be permitted to free his land designated in the license from all the legal relations existing between the land and other parties by way of methods in compliance with the provisions in force, for instance by buying the land from the owner or by granting indemnity so that the holder of rights is willing to waive his rights, and as such the holder of the location license can seek rights over the land concerned. The holder of the location license shall not have any right whatsoever over the land designated in the location license before the land is already freed. The right to control the land does not originate from the location license but from the freeing of the land and/or from the granting of rights over land by the State.

To apply for location permit, the PMA company has to submit an application to The Agency for Land Affairs in the Regency and Municipality (BPN Kabupaten/Kota) region with the following attachments: a. A copy of investment approval b. A copy Tax-payer Registration Number (NPWP). c. Sketch of the land required. d. Description of the project concerned. e. A copy of the Articles of Association of the PMA company concerned. BPN Kabupaten / Kota will evaluate the application in a coordination meeting with related government officials and in consideration with the result of consultation with the people at large. Following the evaluation process, the Regent / Major or Governor (only for the Special Territory of Jakarta / DKI Jakarta) will sign the location permit to investor, and its copies to the related agencies. Based on the location permit, the PMA company concerned may start its land acquisition activities.

Building Construction permit Procedures. o The PMA company which has received the location permit and has purchased land can submit building permit application to the Head of the Public Works Unit in the Regency / Municipality (Dinas PU Kabupaten/Kota) region with the following attachments: a. A copy of location permit. b. A copy of identity card of signing applicant. c. A copy of the Articles of Association of the PMA company concerned. d. A copy of land title / certificate. e. A copy of Receipt of land and building tax payment. o The realization of building construction for industries can be started without waiting for the issuance of the Building Construction Permit (Ijin Mendirikan Bangunan / IMB). o Based on post-audit appraisal, the Head of the Dinas PU Kabupaten / Kota will issue the IMB which may also be used for Building Utilization Permit.

Land Title Procedures. o Following the acquisition of land, the PMA company concerned shall promptly submit its request for land rights to the Head of the BPN kabupaten / Kota for the Building Right on Land (Hak Guna Bangunan / HGB) and to the Head of the BPN Province for the Land Cultivation Right on Land (Hak Guna Usaha / HGU), with the enclosed copies of the following documents:

a. A copy of investment approval. b. A copy of location permit. c. A copy of legal documents of land acquisition such as purchase receipt, and so forth. d. A copy of articles of association of the PMA company concerned. For land requirements of 200 (two hundred) hectares or more, the HGU shall be issued by the Head of the National Land Agency (BPN), and for land requirements less than 200 (two hundred) hectares, a letter of decision on the granting of right shall be issued by the Head of the provincial BPN. The Head of the BPN Kabupaten / Kota will issue the HGB. 18

2. Nuisance Act Permit Procedures. o To obtain a Nuisance Act Permit (Undang Undang Gangguan/ UUG / HO), the PMA company concerned should submit an application to the Executive Secretary of the Regency / Municipality Region concerned with the following attachments: a. A copy of location permit. b. A copy of Tax Registration Number (NPWP). c. A copy of articles of Association of the PMA company concerned. d. A copy of Receipt of land and building tax payment. e. A copy of land title / certificate. f. A copy of lay-out of installation, machinery and equipment. g. A copy of description of the production and waste prevention process in the form of a flow chart, block diagram etc. o The Executive Secretary of the Regency/Municipality region concerned on behalf of the relevant Regent/Major shall issue the Nuisance Act Permit. o The Nuisance Act permit shall not be required for factories located in industrial estate, and those industries subject to the Environmental Impact Analysis (AMDAL) requirements.

3. Permanent Business License Procedures.

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PMA company having started commercial production shall be required to submit Permanent Business License (Ijin Usaha Tetap / IUT) application to BKPM / BPM or Investment Institution in Regency / Municipality with the following attachments a. A copy of the ratified Article of Association and modification by the Minister of Law and Legislation, copy of the ratified Cooperative by the Minister of cooperative and Small scale Business Development. b. A copy of land Right or Proof of land ownership or Proof of Land Rent for rented land. c. A copy of Building Construction Permit or Proof of Building Rent for rented building / office / space. d. A copy of Nusantara Act Permit.

e. A copy of Approval of Environmental Management Plan (Rencana Pengelolaan Lingkungan / RKL) and Environmental Monitoring Plan (Rencana / Pemantauan Lingkungan / RPL) for the company whose business activities are obliged to carry out the Environmental Impact Assessment (AMDAL) study or Document of Environmental Management Efforts (Upaya Pengelolaan Lingkungan / UKL) and Document of Environmental Monitoring efforts (Upaya Pemantauan Lingkungan/UPL) for the company whose business activities are not obliged to carry out the AMDAL Study. f. A copy of investment approval including modifications approval. 1. Minutes of project investigation (berita Acara Pemeriksaan Proyek / BAP). 2. In the event the necessary minutes of project investigation is not completed promptly by the BPM or Investment Institution in Regency/Municipality concerned, the applicant attaches the current Investment Activity Report (LKPM). Proxy Statement of the competent, in the event the signing of the application is not done by the Director. For certain business sector the following document is required : a. Certificate of Operation Test by the Directorate General for Electricity and Energy Development, for business sector engaged in Electric Power Supply. b. Proof of Hotel classification from the Directorate General for Tourism. c. A copy of Operational Permit from the local government for Taxi Transportation. d. A copy of Operational Permit from the local government for those whose tourist transport armada or leasing contract with tourist transportation business for Travel Bureau. e. A copy of Selling Permit on Alcoholic beverage for Hotel and Restaurant. The Investment Coordinating Board (BKPM) / BPM or Investment Institution in Regency / Municipality will issue permanent business license.

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