Investment Ministry Introduces Deemed Approval Mechanism to Reform Business Licensing
Warta Ekonomi, Jakarta - The Ministry of Investment and Downstream Industries/Investment Coordinating Board (BKPM) has made a breakthrough in its business licensing reform agenda to improve the investment climate. One such breakthrough is the application of the deemed positive approval (fikpos) principle in business licensing.
Deputy Minister of Investment Todotua Pasaribu explained that fikpos is a mechanism whereby a licence is deemed automatically issued if no decision is made by the authorised official within the stipulated timeframe. The mechanism aims to provide certainty for business operators when applying for business licences through the OSS (Online Single Submission) system.
He conveyed this during a Public Consultation on the Draft Regulation of the Minister of Investment and Downstream Industries/Head of BKPM at the Ministry's offices in Jakarta.
"There is a concept we have prepared at the ministry, namely regarding service level agreements. Within that framework, there is a context called deemed positive approval. The purpose is to provide certainty. Our ministry, as I mentioned earlier, handles around 1,700 types of licences involving approximately 17 other ministries or agencies," said Todotua, as quoted from a BKPM press release on Tuesday (8 July).
On the same occasion, Todotua stated that business licensing reform is a crucial part of the government's strategy to achieve a national economic growth target of eight per cent over the next five years. To reach this target, the government is aiming for investment realisation of Rp13,000 trillion, from both Foreign Direct Investment (PMA) and Domestic Direct Investment (PMDN). Business licensing therefore remains one of the most critical elements in attracting investment.
Deputy Minister of Investment Todotua Pasaribu explained that fikpos is a mechanism whereby a licence is deemed automatically issued if no decision is made by the authorised official within the stipulated timeframe. The mechanism aims to provide certainty for business operators when applying for business licences through the OSS (Online Single Submission) system.
He conveyed this during a Public Consultation on the Draft Regulation of the Minister of Investment and Downstream Industries/Head of BKPM at the Ministry's offices in Jakarta.
"There is a concept we have prepared at the ministry, namely regarding service level agreements. Within that framework, there is a context called deemed positive approval. The purpose is to provide certainty. Our ministry, as I mentioned earlier, handles around 1,700 types of licences involving approximately 17 other ministries or agencies," said Todotua, as quoted from a BKPM press release on Tuesday (8 July).
On the same occasion, Todotua stated that business licensing reform is a crucial part of the government's strategy to achieve a national economic growth target of eight per cent over the next five years. To reach this target, the government is aiming for investment realisation of Rp13,000 trillion, from both Foreign Direct Investment (PMA) and Domestic Direct Investment (PMDN). Business licensing therefore remains one of the most critical elements in attracting investment.