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Indonesia Business License for Ecommerce
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Indonesia is currently facing massive changes with the adoption of economic digitisation. The new Indonesian digital economy system creates a new gate for local and foreign investors to enter the Indonesian market through digital trades.
Who needs a business license for Ecommerce?
individuals or entities engaging in e-commerce activities are generally required to obtain a business license, regardless of whether the operations are conducted through online platforms or physical channels. According to the Ministry of Trade Regulation No. 50 of 2020 on Provisions for Business Licensing, Advertising, Guidance, and Supervision of Business Actors in Trading Through Electronic Systems (Peraturan Menteri Perdagangan No. 50 Tahun 2020), any party conducting commercial transactions online must possess appropriate licenses to operate legally.
Types of Business License for Local Ecommerce
- Legal Structure: Must establish a Local PT (Perseroan Terbatas)
- Business License: Required to obtain a Surat Izin Usaha Perdagangan melalui Sistem Elektronik (SIUPMSE)
- Tax Identification Number (NPWP): Required for business operations
- Domicile Letter: Must obtain from local government
- Investment Plan Submission: Not typically required
- Compliance with Regulations: Must comply with Indonesian laws, including tax and labor regulations
- PSE License: Required if operating an online platform
- Additional Requirements: May need to register under specific KBLI for e-commerce
Types of Ecommerce Business License for Foreign Investors
- Legal Structure: Must establish a PT PMA (Foreign-owned Limited Liability Company)
- Business License: Required to appoint a Foreign Trade Company Representative Office (FTRO PMSE) and obtain SIUPMSE
- Tax Identification Number (NPWP): Required for business operations
- Domicile Letter: Must obtain from local government
- Investment Plan Submission: Required to submit an investment plan to the Investment Coordinating Board (BKPM)
- Compliance with Regulations: Must comply with Indonesian laws, including tax and labor regulations
- PSE License: Required if operating an online platform
- Additional Requirements: Must ensure compliance with additional foreign investment regulations
Types of E-Commerce Businesses in Indonesia
Indonesia has a diverse e-commerce sector, with various business models targeting different customer segments.
- Business-to-Consumer (B2C): The fastest-growing sector which focuses on consumer needs.
- Business-to-Business (B2B): The type of e-commerce business that serves the needs of other businesses.
- Business-to-Government (B2G): Catering to local, regional, and central government needs.
E-Commerce Business Regulations Updates in 2024
Since 2024, launching an e-commerce venture in Indonesia demands compliance with the following prerequisites.
Local and Foreign E-Commerce Organizers (PPMSE)
- Must apply for an E-commerce Trade Business License (SIUPMSE)The application for an E-commerce Trade Business License (SIUPMSE) is mandatory
- Foreign PPMSE companies must set up a representative office to conduct foreign trade.
Local and Foreign E-Commerce Merchants
- Local e-commerce businesses require the proper trade licenses
- E-commerce platforms of local vendors require an SIUPMSE
- Foreign businesses must register their licenses with the local PPMSE
Local and Foreign Intermediary Services Organizers (PSP)
- Those not directly involved in e-commerce transactions as beneficiaries or intermediaries are exempt from obtaining a SIUPMSE
Document Requirements to Get a Business License for Ecommerce in Indonesia
- Identity and contact details of Company Directors: For Indonesian individuals, KTP, NPWP, email, and phone number. For Foreign Individuals, valid passport, email, and phone number.
- Copy of Deed of Establishment along with Decree Approval from Ministry (SK)
- Copy of Amendment of Article of Association along with Decree Approval from Ministry (if any)
- Username and Password of OSS (Online Single Submission)
- Email and Password used for OSS (Online Single Submission)
- Other required document
Register an E-Commerce License in Indonesia with LMI Consultancy
- Consult your inquiry with our professional consultant
- Submit necessary document
- Proceed with the payment
- Application process
- Receive the complete document
Other Popular Legal Licensing Services in Indonesia
Setup a Business in Indonesia with LMI Consultancy
Established in 2016, LMI Consultancy has been supporting countless individuals in understanding the intricacies of visas, business setup, tax & accounting, and property investment in Indonesia, providing a comprehensive and dependable service.
We take pride in being an ethical and innovative company that places a strong emphasis on exceptional customer service and strives to set a new standard in our industry, guaranteeing a smooth and encouraging experience for our clients.
FAQ
Does my PSE License expire?
Your PSE license remains valid as long as the website and application remain active and unchanged.
What are the consequences of my business operating without a PSE License?
Failure to register your website or application for a PSE License in Indonesia may result in its being blacklisted by the Ministry of Information and Technology.
What additional permits or licenses are necessary to operate an e-commerce business?
ou need to make sure that your Business License also has an E-commerce business license. Other than that, you have to obtain the correct licenses for your specific industry.
What licenses and permits are required to run an online business in Indonesia, and do I need a sales tax license?
Yes, business owners operating an online business in Indonesia are required to obtain relevant licenses or permits, including a sales tax permit, depending on the nature and scale of their operations. These requirements ensure the business is legally recognised and complies with national tax obligations.
While a sales tax license (often part of your tax identification number or NPWP) allows you to legally collect and remit sales taxes, additional permits may be required for certain product categories, digital services, or marketplaces.
Do I need an Employer Identification Number to begin business operations in Indonesia, and what are the licensing requirements?
In Indonesia, instead of an Employer Identification Number (EIN) like in other countries, businesses must obtain a Tax Identification Number (NPWP) and register their business operation through the Online Single Submission (OSS) system. The licensing requirements vary based on the industry and type of business activities you intend to carry out.
If you plan to have partners, investors, or foreign shareholders, it is important to share this information during the registration process as it may affect the legal structure and licensing needs.
What are the requirements for business licenses in Indonesia for a small business?
The requirements for business licenses and permits in Indonesia vary depending on your sector and business scale. While general business licenses are needed for most industries, certain fields may require additional sector-specific permits.
In general, to register your business and apply for a business license, you must prepare legal documents such as the Deed of Establishment, tax number, and NIB (Business Identification Number). To obtain a business license, small business owners must also ensure compliance with local zoning and trade classifications.
Note that license requirements vary, so working with a consultant like LMI Consultancy can help clarify your obligations and ensure you meet the right criteria for a license to operate in Indonesia.
How much does a business license cost in Indonesia?
The business license cost in Indonesia depends on several factors, including your business type, location, and whether it is locally or foreign-owned. While government fees for standard registrations may be minimal or even waived for micro and small enterprises, additional costs such as notary services, legal consultation, and sectoral permits may apply.
If you are unsure whether or not your business in Indonesia will require an e-commerce license, you may consult LMI Consultancy’s professional consultants with your questions through our 1 hour free consultation.
Disclaimer : Our services in LMI Consultancy provide consulting services focused on ensuring client compliance with applicable immigration and legal regulations in Indonesia. We do not provide or facilitate the production of official government documents, nor do we offer any expedited or preferential access to government services.
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