Legal Alert: Closure of Services for Obtaining Certificate of Domicile in Special Capital Region of Jakarta

/ / 2019, Legal News, Legal News 2019

Author: Anton Latief, Edly Febrian Widjaja, Rizqi Bangun Lestari

On 26 April 2019, the Head of Special Capital Region of Jakarta Investment and One Stop Integrated Services (“Jakarta One Stop Services”) has issued announcement No. 27 of 2019 on the Closure of Non-License Administration Service for Company Certificate of Domicile/Surat Keterangan Domisili Perusahaan (“SKDP”) and Business Certificate of Domicile/Surat Keterangan Domisili Usaha (“SKDU”) at Jakarta One Stop Services (“Announcement”).

In general, the following points were outlined in the Announcement:

1. SKDP and SKDU have increased procedures to the licensing process that hinder the ease of doing business climate.
2. As a proof of commitment from the Special Capital Region of Jakarta Provincial Government to improve the ease of doing business climate in Jakarta, the administration service to obtain SKDP and SKDU was closed on 2 May 2019.
3. In lieu of the SKDP and SKDU, business owners can use other business licenses issued by the Jakarta One Stop Services and/or from other government institutions, as regulated in relevant laws and regulations (e.g Online Single Submission or the Indonesia Investment Coordinating Board).

Prior to the Announcement, SKDP and SKDU for companies domiciled or to be domiciled in Jakarta were issued by the Jakarta One Stop Services and generally viewed as one of the required licenses in the establishment of such companies. Previously, SKDP and SKDU were required to obtain further licenses and fulfill certain administrative requirements (e.g. in opening a bank account).

The issuance of the Announcement is considered as a “breath of fresh air” in promoting the ease of doing business climate in Indonesia. Specifically, the Announcement eliminates uncertainties on whether the SKDP and SKDU are still needed in the Special Capital Region of Jakarta to obtain further licenses or for daily business operations. In order to simplify the establishment and licensing of companies in Indonesia, it would be favorable for this important move to be followed by other provinces in the country.

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