Background

On 13 June 2019, the Republic of Indonesia Government enacted the Minister of General Works and Public Housing Regulation Number 08/PRT/M/2019 on Licensing Services Guideline For National Construction Services (“Permen PUPR 08/2019”).

Permen PUPR 08/2019 sets guidelines for district/city governments in the formulation for local regulation on business licensing services for the construction service business including Individual Business Registration Certificate (“TDUP”) and Construction Service Business Permit (“IUJK”).

Construction services mean construction consultancy services and/or construction work.

Individual Business Registration

Every individual business that will provide construction services in the territory of Indonesia is required to obtain TDUP which issued by the Management Institution and Online Single Submission (“OSS”) Operator (“Lembaga OSS“), for and on behalf of regent or mayor.

Type of TDUP includes:

  1. construction consultancy services; or
  2. construction work

TDUP is applied by individual Indonesian citizens and will be valid as long as the business runs and/or actively conduct the activities.

The types of licensing services for TDUP consist of:

  1. Issuance
    The stages of publishing the TDUP includes:

    1. Registration
      Registration is carried out by the applicant through the OSS system to obtain the Employer Identification Number (“NIB”) in accordance with laws.
    2. Issuance of TDUP based on commitment
      This stage is conducted by filling information, at least:

      • name and standard classification code of Indonesian business field; and
      • statement of fulfilling TDUP commitments.
        After receiving that information, the Lembaga OSS will issue a TDUP based on the commitment and submit it to the Investment and Integrated One-Stop Service (“DPM PTSP“) through the OSS system.After receiving that information, the Lembaga OSS will issue a TDUP based on the commitment and submit it to the Investment and Integrated One-Stop Service (“DPM PTSP“) through the OSS system.
    3. Fulfillment of commitment
      The stages of fulfilling commitment include:

      • for construction consultancy services, at least a certificate of competency for expert qualifications 8; or
      • for construction works, at the lowest technician work competency certificate level 5 qualification.
        The period to fulfill the commitment is no later than 30 (thirty) days after the Lembaga OSS issues TDUP based on commitment.
    4. Verification and validation of fulfillment of commitment
      Documents for fulfilling TDUP commitment are submitted by the applicant to DPM PTSP. After receiving the document to fulfill the commitment, DPM PTSP will coordinate with the technical team to carry out verification and validation.
      Verification and validation of fulfillment of commitments are carried out no later than 5 (five) days as of the fulfillment are declared as completed.
      The results of verification and validation will be notified to the Lembaga OSS through the OSS system.
    5. Issuance of effective TDUP
      Lembaga OSS issues a TDUP through the OSS system based on the notification to fulfill the commitment from the DPM PTSP.Lembaga OSS will cancel TDUP based on a commitment if the applicant does not fulfill the commitment and /or does not submit the required documents within the time provided.
  2. Data Changes and Revocation Based on Application
    Submission of data changes and revocation of TDUP are made through the OSS system. The change of TDUP data that is possible is the change of registered address in the TDUP and/or change of type of skill set forth in TDUP.
    The revocation of TDUP could be made after the fulfillment of tax obligations, debt repayment and fulfillment of obligations in implementing the TDUP including the settlement of payment of administrative penalties.
    DPM PTSP will coordinate with the technical team to verify and validate the fulfillment of obligations related to the submission of TDUP revocation. This process is carried out no later than 5 (five) days after the proof of fulfillment of the obligation is received. Revocation of TDUP is carried out by the Lembaga OSS after obtaining the results of verification and validation from PTSP DPM regarding the fulfillment of obligations related to filing revocation of TDUP.
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Construction Services License Business Entity

IUJK business entity os applied by person in charge of the business entity as the national construction services business entity through the OSS system. National construction services business entity means construction services business entity in the form of state-owned business entity (BUMN), regional-owned business entity (BUMD), or private-owned business entity (BUMS) whose entire or most of its capital is owned by the state, regional government, individuals Indonesian citizens, and / or Indonesian business entities (“BUJKN“).

IUJK applicant for business entities consists of:

  1. limited liability company;
  2. public company;
  3. regional public company;
  4. other legal entities owned by the state;
  5. public services agency;
  6. a business entity established by the foundation;
  7. cooperative;
  8. commanditaire partnership (commanditaire vennootschap);
  9. fellowship firm (vennootschap onder firm); and
  10. civil partnership.

IUJK business entity is valid as long as the business entity runs business and/or activity.
Licensing service for IUJK business entities, consists of:

  1. Issuance
    The stages of publishing the IUJK includes:

    1. Registration
      Registration is carried out by the applicant through the OSS system to obtain the NIB in accordance with laws and regulations.
    2. Issuance of TDUP based on commitment
      This stage is done by filling information, at least:

      • name and standard classification code of Indonesian business field; and
      • statement of fulfilling IUJK commitments.
        After receiving the information as mentioned above, the Lembaga OSS will issue the IUJK based on commitment and submit it to the DPM PTSP through the OSS system.
    3. Fulfillment of commitment
      Fulfillment of commitment for IUJK business entities should be proven by the applicant through the ownership of a Business Entity Certificate (“SBU”).
      The stages of fulfilling the commitment will be completed no later than 30 (thirty) days after the Lembaga OSS publishes the IUJK business entity based on commitment.
    4. Verification and validation of fulfillment of commitment
      Documents for fulfilling IUJK commitments are submitted by the applicant to DPM PTSP. After receiving the document to fulfill the commitment, DPM PTSP will coordinate with the technical team to carry out verification and validation.
      Verification and validation of the commitment fulfillment document are made no later than 5 (five) days from the date the commitment fulfillment documents are declared complete.
      After the verification and validation process is complete, DPM PTSP will notify the Lembaga OSS through the OSS system.
    5. Issuance of effective IUJK
      The Lembaga OSS issues the effective IUJK business entity through the OSS system based on the notification of commitment fulfillment from DPM PTSP.The Lembaga OSS will call off the submission of IUJK business entity based on commitment if the applicant does not fulfill the commitment and/or does not submit the required documents within the time provided.
  2. Data Changes and Revocation Based on Application
    Submission of changes of data and revocation of IUJK business entity is submitted through the OSS system. The data that can changes of IUJK business entity that can be done consists of:

    1. changes of name of BUJKN;
    2. changes in office address;
    3. changes of the person in charges of business entity (“PJBU”);
    4. changes of the technical person in charges of the business entity (“PJTBU”); and/or
    5. changes in business sub-classification according to the standard classification of Indonesia field of business.
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The revocation of IUJK business entity could be submitted after the fulfillment of tax obligations, debt repayment and fulfillment of obligations in implementing the IUJK business entity including the settlement of payment of administrative penalties.

Application to revoke IUJK conducted by completes information, at least:

  1. name of BUJKN;
  2. NIB;
  3. copy of deletion principal taxpayer number decree or fiscal statement; and
  4. statement letter on fulfillment of the obligations related to taxation, debt payment, and settlement of payment of sanctions administratively.

DPM PTSP will coordinate with the technical team to verify and validate the fulfillment of obligations related to the submission of IUJK business entity revocation. This process is carried out no later than 5 (five) days after the proof of fulfillment of the obligation is received.

Revocation of IUJK business entity is carried out by the Lembaga OSS after obtains the results of verification and validation from DPM PTSP regarding the fulfillment of obligations on application of IUJK business entity revocation.

Implementation of Business Licensing

Construction Services entities who has a license, either TDUP or IUJK business entities, should fulfill the provisions and obligations stipulated in the Permen PUPR 08/2019.

Business entities who have TDUP are required to:

  1. submit reports on annual business activities; and
  2. carry out, at least 1 (one), the work of construction services in the period according to the validity period of the work competency certificate.

Business entities who have an IUJK business entity are obliged to fulfill the following conditions:

  1. directors, commissioners, PJBU, and PJTBU do not occupy the positions of directors, commissioners, PJBU, and PJTBU at other Construction Services entities at the same time, this must be proven by the statement;
  2. conducting construction services in market segments according to their qualifications;
  3. only do work that is in accordance with the business sub-classification listed on the IUJK business entity;
  4. submit reports on annual business activities;
  5. register business experience, specifically for BUJKN intermediate and large qualifications;
  6. have at least 1 (one) Construction Services job within a period of 3 (three) years in accordance with the validity period of the SBU;
  7. employ construction workers who own work competency certificates;
  8. have a registration certificate from the Minister of General Works and Public Housing (“Minister”) for foreign construction workers in the position of experts in the Construction Services sector who will be employed by the employer; and
  9. employ Indonesian workers as assistants in the management and technical fields at least one level below the position of foreign workers based on appropriate classification.

The annual business activity report, as mentioned above, must be submitted by the business entities of TDUP or IUJK, to the regent/mayor no later than the 30th of April of the following year. For owners of IUJK business entities, the submission of business experience registration must be submitted annually to the Minister, proven by a sign of experience register.

Shalomo Mashury Tampubolon