Are you planning to establish a construction companies in Indonesia but don’t know how? Don’t worry, this article will guide you through the important things you need to know before starting a construction company in Indonesia.
Understanding The Regulations
First of all, it’s essential to understand the regulations for establishing a construction company in Indonesia, particularly those related to licensing and legality.
In Indonesia, construction companies are divided into three classifications based on their capital sources:
- BUJK-N (Domestic Investors)
- BUJK-PMA (Foreign Investors)
- BUJK-A (Foreign Construction Companies)
As a foreign citizen, you have the option to establish a foreign-owned construction company in Indonesia (BUJK PMA) or set up a representative office (BUJK-A) for your existing construction company abroad.
Generally, establishing a foreign-owned construction company (BUJK PMA) in Indonesia is preferred over opening a representative office (BUJK-A). This is because BUJK-A requires cooperation (Joint Operation) with a registered BUJK-N, while BUJK PMA only requires a joint venture with BUJK-N.
The regulations governing the establishment of construction companies for foreign investors (BUJK-PMA) in Indonesia are found in:
- Undang-Undang Cipta Nomor 11 Tahun 2020 tentang Cipta Kerja
- Peraturan Presiden Nomor 49 Tahun 2021 tentang Perubahan Atas Peraturan Presiden Nomor 10 Tahun 2021 tentang Bidang Usaha Penanaman Modal
- Peraturan Badan Koordinasi Penanaman Modal Nomor 4 Tahun 2021 tentang Pedoman dan Tata Cara Pelayanan Perizinan Berusaha Berbasis Risiko dan Fasilitas Penanaman Modal
Fulfilling Legal Requirements for Foreign Construction Companies in Indonesia (BUJK PMA)
In Indonesia there are many forms of business entities as the legality of a company. However, all foreign investment (PMA), especially foreign construction companies (BUJK PMA) in Indonesia, must be in the form of a Perseroan Terbatas (PT) PMA.
This PT is the same as an LLC, where there is a separation between personal assets and company assets. Because foreign investment (PMA) in Indonesia is classified as a large business scale, the minimum investment value is IDR 10 billion.
In addition, because BUJK PMA is a joint venture with BUJK-N, there are provisions related to the minimum capital ownership. Where non-ASEAN foreign investors have a maximum of 67% of the total shares. Then for ASEAN foreign investors, a maximum of 70% of the total shares.
There are many other requirements related to the establishment of PT PMA for construction companies in Indonesia that you need to know. To make it easier, you can use the PT PMA Establishment Service from AdminKita.
Completing Construction Business Licensing Requirements in OSS-RBA
After establishing a PT for your construction company, then you need to complete all construction business permits at OSS-RBA. There are several licensing documents that you must fulfill, including:
- Nomor Induk Berusaha (NIB)
- Sertifikat Standar Terverifikasi
NIB is the business number identity for all companies in Indonesia. It’s a basic permit document just like a personal ID for the company. You need to obtain NIB before processing the Sertifikat Standar in OSS.
After obtaining the NIB, you need to have Sertifikat Standar Terverifikasi (Verified Standard Certificate). For all companies in Indonesia that listed on construction business sector, the standard certificate will be verified after having an SBUJK.
But to be able to have an SBUJK, there are several documents you need to obtain first. It’s such as:
- SKK Konstruksi (Construction Work Skill Certificate) for PJTBU and PJSKBU,
- KTA Tenaga Ahli (Membership Card of),
- Construction Business Entity Association KTA
Once you have all the documents above, you can finalize the SBUJK and complete the verification of your Standard Certificate through OSS-RBA.
We know that preparing and managing these documents can be overwhelming. From investment approvals to licensing, there are numerous steps to navigate.
That’s where professional services from AdminKita come in handy. We provide end-to-end assistance, ensuring a hassle-free setup in OSS for your construction business
For more information, you can see our OSS Construction Business Licenses Management Service that we provide just to make it easier for you!
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