First thing you should know to enter construction sector is that Indonesia has its own regulation regarding construction services’ permits. Therefore, you better get these things ready before conducting your business here.
All companies planning to enter construction sector, companies (both existing and new companies) starting construction services or planning to become a contractor consultant in construction field need a permit to conduct their service called Permits for Construction Services or IUJK as regulated on Ministry of Public Works Regulation No. 04/PRT/M/2011 on Terms on Giving Construction Services’ Permits.
The authorized agency who is responsible for giving IUJK to the company is Regency/City Government of its domicile. According to the Article 5 (2) of Ministry Regulation, the applications you can submit to the Regency/City government are:
- New permit
- Permit renewal
- Data changes
- Closing permit
If you are new in this business field then you have to make a new permit for your business. There are some documents required for obtaining new permit, first you have to complete the Permission Application form and prepare all the corporate documents, such as deed of establishment of National Construction Service Enterprise along with the company profile, Certificates of Business Entities which has been registered by the authorized institute, Expertise Certificate and/or Certificate of Skill from person in charge of technical matters who has registered by the institution, depends on your IUJK qualification that you need.
If you started your business on small project, you need the Certificate of Skill only. The Expertise Certificate will be needed when you started your business on the middle project base. Lastly, you must also submit Business Entity Card along with the self-binding statement letter from the expert with person in charge of the business entity.
The authorized institution, as mentioned on the Government Regulation No. 4 of 2010 and on the Indonesian Law No. 2 of 2017 on Construction Services, is the construction service development agency, who will check all the documents and probably will do the field verification if that is needed. The IUJK will be granted by a work agency/unit no longer than 10 (ten) days after all the required documents are completed. It will be given in the form of certificate signed by Regent/ Mayor or Head of Work Unit/Institution appointed on behalf of Regent/Mayor.
The IUJK that has already given will be announced through the internet media and each of it shall state the classification and qualification of the business entity that listed on the Certificate of Business Entity. Remember, all of those documents must be true and originals, otherwise there will be administrative sanction with written warning or even revocation of the business permit itself.
Once you have obtained the Construction Service Permit, you are ready to run your business. Good luck!
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ELSON Indonesia is a company that focus on providing comprehensive legal solution for expatriates, foreigner, and mix marriage couple in Indonesia.