“The business entities who already registered on the OSS System previously have to migrate their data to the OSS Risk-Based Approach to maintain their business registry and licenses.”
In November 2020, the Government issued the Job Creation Law No. 11 of 2020 (UU Omnibus) to attract more investors into Indonesia by simplifying investment regulations, requirements, and procedures. Following the enactment of Law No. 11 of 2020, the Government has introduced the necessary implementing regulations to the law. One of the changes under the Omnibus Law, one in particular, is affecting business licensing.
Currently, mostly licensing activities are implemented through the single online submission (“OSS”) system. The business entities are required to obtain their business licenses through the OSS system. The Indonesia Investment Coordinating Board (Badan Koordinasi Penanaman Modal/BKPM) issued new regulations regarding this, which contain a few essential changes; BKPM introduces a new concept named Risk-based Approach Licensing System (“OSS RBA”).
Based on Government Regulation Number 5 the Year 2021 concerning Risk-Based Business Licensing, the OSS system will assess the applicant’s business and assign it to one of four risk categories (low, medium-low, medium-high, and high). Shifting the whole procedure was envisioned to make it more efficient and easier to attract more investors.
Migrate the Data From the OSS 1.1 to OSS RBA
Those who already have access rights under the old OSS System need to be migrated to the access rights under the OSS RBA system. By migrating data from OSS 1.1 to OSS RBA, the data initially recorded should automatically be migrated and recorded in OSS RBA. Those who don’t have access to OSS can register and get access to the OSS system either as an individual or as a corporate organization. Below are the steps to migrate the OSS 1.1 to the OSS RBA;
- To migrate the system, you have to enter into your OSS account through https://oss.go.id/ with your username and current password;
- On the homepage, you click NIB and check the Business License that you already have; if the business license is already effective, the system will directly show the list of the business field, including (KBLI, Business Location and Business Information). You can directly print the NIB. However, those whose business licenses are not yet effective can continue to make it effective by completing the business data and submitting an Environmental Approval Document, Polygon Map, and other required documents depending on which KBLI you choose.
Furthermore, the applicants of the business licensing as stipulated in Regulation of BKPM Number 4 the year 2021 consist of;
- An individual person;
- Business entities;
- Representative Offices; and
- Foreign business entities.
The Differences Between OSS 1.1 and OSS RBA
There are a few differences between OSS 1.1 and OSS RBA as written below;
a. In OSS 1.1, there is no formal licensing system in place, and all business operations are given the same level of consideration. Meanwhile, in OSS RBA will examine and classify business activities into four categories based on risk level;
b. In OSS 1.1, the licenses are placed in the same level of consideration, and every business operation will get Business Identification Number (NIB), Business Permit, and Commercial and Operational Licenses. Meanwhile, in OSS RBA, the licenses given are different based on risk level;
i. Low-Risk: NIB
ii. Medium-Low risk; NIB and Standard Certificate
iii. Medium-High risk: NIB and Standard Certificate
iv. High risk; NIB, Standard Certificate, and Permit
c. Regarding the incentives and facilities in OSS 1.1, businesses may apply for tax holidays, tax allowance, and investment allowance via OSS; meanwhile, in OSS RBA, there are additional schemes for companies in the Special Economic Zone (SEZ).
The government aims to simplify the licensing activities with the new system from OSS. It makes it easier to process the license and attracts more investors.
Author: Sutria Puti Dwirahayu
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