Government Enacts New Risk-Based Business Licensing Regulation to Boost Investment
The government has officially enacted Government Regulation (PP) Number 28 of 2025 on the Implementation of Risk-Based Business Licensing, replacing PP Number 5 of 2021. The policy has been affirmed as a demonstration of the government's commitment to building a more efficient business licensing ecosystem to drive national investment growth.
Secretary of the Coordinating Ministry for Economic Affairs, Susiwijono Moegiarso, explained that there are three key breakthroughs underpinning the latest regulation. One of these is the certainty of service timelines, or Service Level Agreements (SLA), in the business licence issuance process.
"The SLA will serve as a time reference throughout all stages of the process, from registration and document verification through to licence issuance. This provides clarity and certainty for business operators," said Susiwijono at the launch of the regulation at Graha Sawala, Ali Wardhana Building, Coordinating Ministry for Economic Affairs, Jakarta, on Monday (30/6/2025).
Additionally, PP 28/2025 introduces a phased fictive-positive policy. This means that if the relevant authority fails to respond within the timeframe stipulated by the SLA, the system will automatically advance the process to the next stage. This mechanism is expected to cut bureaucracy and accelerate services.
Another important point is the simplification of processes for Micro and Small Enterprise (UMK) operators. Through the enhanced Online Single Submission (OSS) system, UMK operators need only complete a self-declaration to obtain their business legality. The latest OSS system is also equipped with three new subsystems: the Basic Requirements subsystem, the Business Facilities subsystem, and the Partnership subsystem. These three subsystems are designed to improve the integration and efficiency of licensing services.
Susiwijono emphasised that PP 28/2025 will serve as the single reference for all business licensing in Indonesia. Accordingly, no additional requirements may be issued by ministries, agencies, regional governments, or zone administrators unless explicitly stipulated in the regulation.
"This regulation is the primary reference. No additional requirements beyond those stipulated are permitted. This is to prevent regulatory overlap and provide legal certainty to business operators," he stressed.
The government hopes that through the implementation of PP 28/2025, Indonesia's investment climate will become increasingly conducive, and the business sector, particularly micro and small enterprises, will gain tangible ease in accessing business legality and facilities.
Secretary of the Coordinating Ministry for Economic Affairs, Susiwijono Moegiarso, explained that there are three key breakthroughs underpinning the latest regulation. One of these is the certainty of service timelines, or Service Level Agreements (SLA), in the business licence issuance process.
"The SLA will serve as a time reference throughout all stages of the process, from registration and document verification through to licence issuance. This provides clarity and certainty for business operators," said Susiwijono at the launch of the regulation at Graha Sawala, Ali Wardhana Building, Coordinating Ministry for Economic Affairs, Jakarta, on Monday (30/6/2025).
Additionally, PP 28/2025 introduces a phased fictive-positive policy. This means that if the relevant authority fails to respond within the timeframe stipulated by the SLA, the system will automatically advance the process to the next stage. This mechanism is expected to cut bureaucracy and accelerate services.
Another important point is the simplification of processes for Micro and Small Enterprise (UMK) operators. Through the enhanced Online Single Submission (OSS) system, UMK operators need only complete a self-declaration to obtain their business legality. The latest OSS system is also equipped with three new subsystems: the Basic Requirements subsystem, the Business Facilities subsystem, and the Partnership subsystem. These three subsystems are designed to improve the integration and efficiency of licensing services.
Susiwijono emphasised that PP 28/2025 will serve as the single reference for all business licensing in Indonesia. Accordingly, no additional requirements may be issued by ministries, agencies, regional governments, or zone administrators unless explicitly stipulated in the regulation.
"This regulation is the primary reference. No additional requirements beyond those stipulated are permitted. This is to prevent regulatory overlap and provide legal certainty to business operators," he stressed.
The government hopes that through the implementation of PP 28/2025, Indonesia's investment climate will become increasingly conducive, and the business sector, particularly micro and small enterprises, will gain tangible ease in accessing business legality and facilities.