When it comes to doing business in Indonesia, navigating the legal requirements can seem daunting, but understanding the different types of business licenses is crucial.
In this article, we’ll dive into the primary licenses and non-primary licenses that businesses need to operate within the country. Whether you’re planning to start a consulting firm, a manufacturing company, or a restaurant, knowing the right license is a crucial step.
Also read: What is a Business License: A Comprehensive Guide
Primary Business Licenses
The primary business licenses are the most frequently utilized permits for businesses. In Indonesia, companies commonly opt for one of three main licenses, which include:
General Business License (NIB)
The General Business License, also known as NIB (Nomor Induk Berusaha), is a versatile license that covers a wide range of general business activities. If you’re involved in trading, consulting, or providing services, the NIB is your go-to license. It’s the foundation for many businesses and simplifies the licensing process.
Industrial Business License (IUI)
For businesses engaged in manufacturing activities, the Industrial Business License (IUI) is essential. Whether you’re producing goods or processing materials, this license ensures that your operations align with safety and quality standards.
Construction Business License (SBU)
Businesses in the construction sector must obtain a Construction Business License (SBU). This license is mandatory for companies involved in building, infrastructure development, and related activities. It ensures that construction projects adhere to regulations and safety measures.
Also read: SME Meaning in Business: Definition, Types, How to Start One
Non-Primary Business Licenses
Non-primary licenses are required for specific business activities, such as operating a restaurant, hotel, or transportation company. Some examples of non-primary licenses include:
Restaurant License
If your business involves the sale of food and beverages, obtaining a Restaurant License is a must. This license ensures that your establishment follows hygiene standards and other regulations, guaranteeing the health and safety of your customers.
Hotel License
For those venturing into the hospitality sector, the Hotel License is indispensable. This license applies to businesses providing accommodation services to guests. It covers various aspects, including safety, hygiene, and guest comfort.
Transportation License
Operating a transportation business, whether taxis, buses, or trucks, demands a Transportation License. This license oversees the safety of passengers, the proper maintenance of vehicles, and adherence to transportation laws.
Also read: What is a Business Registration Number: A Complete Guide
The main difference between primary business licenses and non-primary business licenses is that primary business licenses are more general and can be used for a wider range of business activities. Non-primary licenses are more specific and are only required for certain types of businesses.
Another difference between primary business licenses and non-primary business licenses is that the application process for primary business licenses is generally simpler than the application process for non-primary business licenses. This is because primary business licenses are more common and the government has a more streamlined process for processing them.
Also read: Can a Foreigner Own 100% of a Business in Indonesia?
The cost of a primary business license is also generally lower than the cost of a non-primary business license. This is because primary business licenses are more common and the government does not need to spend as much time and resources processing them.
If you are planning to start a business in Indonesia, it is important to determine which type of business license you need.
To obtain a business license in Indonesia, you will need to submit an application to the Ministry of Trade (Kemendag). Given that the application process can be intricate and time-consuming, initiating the process early is crucial.
For a simpler registration process, you can rely on InvestinAsia’s services to obtain a business license in Indonesia. We can assist and ensure a hassle-free application.
