Indonesia’s Online Single Submission (OSS) system was meant to simplify business licensing and boost investment. In 2025, however, many foreign investors still find it complex, inconsistent, and risky. Despite reforms like Government Regulation No. 28/2025, implementation gaps, regional resistance, and legal ambiguities persist.
Also read: OSS in Indonesia: A Guide for Foreign Companies
The Promise vs. the Reality
The OSS was designed to centralize licensing under the Ministry of Investment and BKPM, replacing fragmented regional systems. In theory, a single platform should reduce bureaucracy. In practice, uneven regional capacity and poor coordination between government levels mean that investors still face local variations in procedures.
Regional Gaps and Resistance
A key bottleneck is the lack of digitized RDTR (Detailed Spatial Plans). Only about 10% of Indonesia’s 514 regencies and municipalities have integrated these into the OSS. Without them, location approvals stall, forcing manual processes that the system was supposed to replace.
Some regional governments openly resist the OSS, citing fears over losing control of licensing decisions and revenue. This creates a patchwork of compliance standards, where the same investment might be approved quickly in one province but delayed for months in another.
Also read: How to Apply for Indonesia Investment Incentives via OSS
The “Fictitious Positive” Paradox
GR 28/2025 introduced the “fictitious positive” rule: if authorities don’t respond within a set timeframe, licenses are automatically approved. While meant to create certainty, it often causes more confusion. Ministries and regions interpret it differently, and many lack the capacity to meet deadlines—leading to delays or conflicting outcomes.
Sectoral Restrictions Still Complicate Matters
Indonesia’s Positive Investment List replaced the Negative Investment List, but restrictions remain. Some sectors are fully closed to foreign ownership, others partially open with conditions. The OSS often fails to clearly communicate these nuances, leading to rejected applications or regulatory breaches that can trigger sanctions.
Also read: The Complete Checklist Before You Open a Business in Indonesia (Local and Foreign)
Post-Licensing Risks and Enforcement
The risk-based OSS allows businesses to start operations before fulfilling all requirements, but post-licensing audits create uncertainty. Operation Wira Waspada in 2025 saw 267 foreign-owned companies lose licenses, with some facing visa cancellations. For investors, this undermines confidence in long-term stability.
Also read: Risk-Based Business Licensing and OSS System in Indonesia
Technical and User Experience Issues
From system crashes to unclear error messages, the OSS platform still struggles with usability. Local officials often lack technical skills to guide investors, forcing many back into manual processes. For foreign investors without Bahasa Indonesia fluency, language barriers add another layer of difficulty.
Corruption Risks in a Digital Age
While OSS aims to reduce rent-seeking, discretionary powers and procedural opacity at the local level still open doors to informal payments. Complex rules and unclear guidance can push investors toward unofficial “facilitators” who promise faster results.
For foreign investors, the key is strategic preparation:
- Verify sectoral eligibility before starting OSS submissions.
- Secure accurate RDTR data and local compliance checks.
- Use professional advisors to navigate both central and regional requirements.
- Maintain strong documentation for post-licensing audits.
This is where InvestinAsia’s Indonesia Company Registration Services can bridge the gap. Our team ensures correct documentation, pre-checks sectoral rules, coordinates with both central and regional authorities, and minimizes licensing delays—helping you enter the Indonesian market with confidence.
We also provide other services such as:
- PMA registration in Indonesia (Foreign Company)
- Representative office registration in Indonesia
- Indonesia Local PT PMDN Set Up
- Indonesian Virtual office setup
- Business registration number in Indonesia
- Business Licenses in Indonesia
- Trademark Registration in Indonesia
- Franchise License in Indonesia
If you are interested in starting a business in Indonesia without hassle, you can start by contacting us for FREE consultation.
FAQs
Is the OSS system mandatory for all businesses in Indonesia?
Yes. Most business licensing in Indonesia goes through OSS, but some sectors still require separate approvals.
Can a license be revoked after it’s issued in OSS?
Yes. Under the risk-based system, post-licensing audits can lead to revocation if compliance gaps are found.
Is it possible to use OSS without knowing Bahasa Indonesia?
Technically yes, but language barriers can cause errors and delays. Many critical documents remain in Bahasa.
Does “fictitious positive” mean guaranteed approval?
No. It means automatic approval if deadlines are missed, but inconsistent enforcement limits its reliability.
