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BKPM takes over licensing power from Industry Ministry

The Industry Ministry has officially transferred full authority to issue investment permits in a number of business sectors to the Investment Coordinating Board (BKPM) to support the government’s efforts to turn the board into a one-stop licensing center

Linda Yulisman (The Jakarta Post)
Thu, December 18, 2014

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BKPM takes over licensing power from Industry Ministry

T

he Industry Ministry has officially transferred full authority to issue investment permits in a number of business sectors to the Investment Coordinating Board (BKPM) to support the government'€™s efforts to turn the board into a one-stop licensing center.

The move followed the launch of its online license-application system last week, which will allow prospective investors to submit their applications from anywhere without physical visit to the board'€™s office.

BKPM chief Franky Sibarani said during the hand-over ceremony Tuesday that the licensing authorities would cover 436 business industrial sectors, out of 1,249 sectors whose investment permits were handled by his office.

The new authorities given by the Industry Ministry will enable BKPM to carry out a variety of measures to quickly issue the so called '€œpermanent business permits'€, which involved multiple stakeholders from ministries to regional administrations.

Previously, BKPM only issued a principle permit while the licensing process from the start of the business to their commercial operation was handled by the ministry

'€œWe have not known yet how much time that we can reduce through the new authorities, but we cannot guarantee the process to pass permits will be much faster,'€ he told reporters during the press briefing.

A set of institutional reforms are considered vital to strengthen the role of the board coordinating body as a one-stop licensing center promised by President Joko '€œJokowi'€ Widodo in less than six months.

Franky said that he already coordinated with 18 ministries as well as other related bodies, such as the Food and Drug Monitoring Agency (BPOM), to obtain extended authorities pioneered by the Industry Ministry and expected the hand over could occur soon.

Investment has been a main driver behind the growth in Southeast Asia'€™s top economy, accounting for 30 percent of its gross domestic product (GDP) and coming second after the domestic consumption.

Attracting sizeable investment to help spur economic expansion is a challenge for the new administration, especially as the economy has so far this year picked by slightly above 5 percent, its slowest pace in almost five years.

The board previously set that it aims to pull investments totaling Rp 932.9 trillion (US$73.31 billion) by 2019.

Speaking during the ceremony, Industry Minister Saleh Husin said that along with the transfer of the authorities, his office appointed some staffs placed at the BKPM to quicken process of investment permits.

'€œEasier access to investment permits would help attract investors to pour their cash in the manufacturing industry,'€ he said.

The authorities assigned to the BKPM include the issuance of new business permits as well as business expansion licenses, covering alcoholic beverages industry, precious paper industry, arms and ammunition industry, industry that process and produce hazardous and toxic materials, strategic high technology industry, industry located in cross-provinces.

Apart from those responsibility, the board can also publish permits for industrial estates or expansion of industrial estates located in cross-provinces, foreign direct investment and revise industrial new business and business expansion licenses.

'€”JP/Linda Yulisman

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