START NOW – It is an obligation for an entrepreneur to complete his business activities with business licenses, in accordance with government regulations.

The good news is that the government has recently simplified the business licenses issue. So, you can now take care of it more easily. 

Various Types of Business Licenses

Before you start, you need to make sure what sector your business will be in (trading, manufacturing, culinary, etc).  

This is important because each business sector sometimes requires some additional business licenses that are different from each other.

To find out the various types of business licensing letters in depth, let’s check out at the following description:

General Business License

Why is it called general? It is because this type of business license is classified as a must-have for all entrepreneurs in Indonesia without exception 

Then, what are these types of general business licenses?  Here’s a breakdown:

NIB (Business License Number)

It’s the first thing a business owner should take care of. The process is easy, and you can even take care of it yourself directly.

All you have to do is access the official government website called OSS (Online Single Submission). This site is specifically intended to handle business licenses.

The process doesn’t take too long and you can run it from home. So, no need to bother to come to a certain office.  

SKDP (Company Domicile Certificate)

The second licensing document is the domicile certificate. You can get this file by taking care of it in stages through RT and RW.

However, for now, especially those in the DKI Jakarta area, SKDP is no longer required. The SKDP function has been replaced by the NIB. 

NPWP (Taxpayer Identification Number)

The third file included in the general business license category is the NPWP. It is necessary so that you can fulfill your tax obligations properly. 

You can obtain an NPWP at the Tax Office, which is in the same area where your business is located.

Special Business License

This second type of license is an additional license related to the business sector. Some examples of business licenses that fall under this category include: 

SIUP (Trade Business License)

SIUP stands for trade business license. As the name implies, this business license is specifically for entrepreneurs engaged in the business of trading.

Furthermore, SIUP is divided into four categories, namely Micro SIUP, Small SIUP, Medium SIUP, and Large SIUP.

Each of them has a classification of capital requirements. The hope is that entrepreneurs can explain the condition of their company honestly and transparently.

SIUI (Industrial Business License)

Just as the trade sector requires additional business licenses, so does the industrial sector. That special license known by the abbreviation SIUI. 

SIUI is given to entrepreneurs whose business activities include processing raw materials into products with new compositions and specifications.

The process of making this special business license is also fairly easy. You can choose to process it online or offline.

SIP (Principle License)

The next special business license you should know is the principle license, which is more commonly abbreviated as SIP. 

This is a special license granted to entrepreneurs whose business activities are engaged in the financial investment sector.

The institution authorized to issue this license is the Investment Coordinating Board or BKPM. 

IMB (Building Permit)

This last special license is not related to the business sector, but to status of establishment of a building. 

All entrepreneurs are required to have an IMB if they want to build a building for a place of business. 

This rule applies to all entrepreneurs, not matter what sector the business activities housed in the building will be in.

If you are caught constructing a building without an IMB, then you will be prohibited from continuing the construction process.

Special Skills License

This type of license is intended for companies that require staff with specialized skills to run their operations. 

An example of a company that requires specialized staff is a company engaged in construction services. This company generally requires a special license called: 

SIUJK (Construction Services Business License)

Companies that are required to have SIUJK are not only those that are actually involved in the world of building. 

Companies that open consulting services, planning services, and construction supervisors are also required to have this license. 

The government hopes that it can, for example, minimize an error in the preparation of the Company’s Articles of Association.

The Benefits of Having a Complete and Compliant Business License

You may need to spend some time and effort to complete of the procedures and requirements for obtaining business licenses. 

However, all these efforts will be very beneficial to support the continuity and smoothness of your business activities going forward.

There are at least four advantages for companies when equipping themselves with various types of business legality letters, namely:

Have a recognition and legal protection by the law

The existence of companies with complete licenses will be legally recognized by the state. So, they will have protection from criminal and civil law.

Can more easily have access to funding from the banks

Companies with complete licenses will also have access to a very wide range of funding from the bank more easily. 

It is because the bank sees your company as a true business entity which has been  recognized by the state.

So, they can be sure of your credibility and ability to complete the credit they will extend.

Have more opportunities for free market development

Surely, having more acces to get extra funding will open wider opportunity for you to develop and expand your company. 

So, you could say that a complete license has a positive impact on the progress of your business.

Have more opportunities to participate in project tenders

By having a complete license, your chances of participating in government tenders will also be more open.

This happens because the company has been legal and recognized by the state. So the company can easily get this access.

If you are too busy to make this business licenses yourself, you can utilize the services of a professional bureau.