Companies Which Require a Trade Business Licenses

Any business in the trade sector can engage in trading activities after they have secured a SIUP. There are however exceptions to this general rule. Business do not require a trade business license in case:

  1. the companies are branch offices or representative offices. In the latter case, the representative office requires a specific trade representative office license; and/or
  2. the companies are holding maximum IDR 50 million of assets.

Validity Period of SIUP and Re-Registration Requirement

Prior to the issuance of Regulation 2017, a SIUP was valid for as long a business remained in operation. However, the business was required to re-register the SIUP every five years. The Regulation 2017 now removes this re-registration requirement. In line with this removal, the Regulation 2017 also removes related provisions, such as the sanctions provisions on non-compliance with the re-registration requirement.

The Regulation 2017, in combination with Ministry of Trade issued Regulation number 8/M-DAG/PER/2/2017 on the Arrangement of the Company Registration, will ease the burdens placed upon trading businesses. The simplified procedures for re-registration of Company Registration Certificate (TDP) and the repeal of the obligation for such businesses to re-register their SIUP is a promising step towards a more investor-friendly business climate.

The Regulation 2017 has been in force since February 22, 2017.

This column is provided by PNB Law Firm Jakarta