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Compliance of a registered company in Indonesia is closely related to business licensing. One of the important aspects that support the business licensing system in Indonesia is the existence of the Online Single Submission (OSS) system. After the enactment of Law Number 11 of 2020 on Job Creation (Omnibus Law) and Government Regulation Number 5 of 2021 on Implementation of Risk-Based Business Licensing (GR 5/2021), a new concept of business licensing in Indonesia is recognized, namely Risk-Based Business Licensing, where the business license which is required by to the business actor is assessed based on the level of risk of the business activities concerned.
Prior to the enactment of the Omnibus Law, the business licensing approach in Indonesia was still in the form of a license approach, where supervision was more focused on fulfilling administrative requirements in obtaining a license. After the enactment of the Omnibus Law, the licensing approach is now shifting towards a risk-based
approach. In Risk-Based Business Licensing, supervision is more focused on the implementation of the business activity to meet the standards and requirements of such a business activity.1
As a follow-up to the enactment of GR 5/2021, from 2 June 2021 to 1 July 2021, the government has conducted the trial implementation of the new OSS system that is oriented to risk-based business licensing, known as OSS-RBA (risk based approaches).2 Risk-Based Business Licensing through the OSS System began implementation on 2 July 2021.3 As for the fulfillment of commitments and applications for new business licenses by business actors submitted to the OSS system after 25 June 2021 where business licenses (effective business licenses) has not been issued by OSS system until 30 June 2021, the business licenses will then be processed based on Risk-Based Business Licensing in accordance with the provisions stipulated in GR 5/2021.4 ALH/HAL
Transition of Implementation of Business Licensing to Implementation of Risk-Based Business Licensing Through OSS