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Jakarta Post

BKPM takes on licensing in transport and construction

Grace D. Amianti
Jakarta   ●   Fri, March 6, 2015

The Investment Coordinating Board (BKPM) has further expanded its authority in providing business licenses after the Transportation Ministry and Public Works and Public Housing Ministry transferred their licensing power to the agency.

The two ministries are among 22 state institutions that have delegated their authority on permit issuance to the BKPM as part of the establishment of a one-stop service.

Heldy Satrya Putera, deputy at the tertiary-sector deregulation directorate at BKPM, said the one-stop service, the PTSP, had enabled the investment board to issue several permits related to the transportation, public works and public housing sectors.

'€œThe BKPM is ready to issue principle or basic permits within 3 days at a maximum for all business sectors,'€ Heldy said on Wednesday.

Regarding business permits for toll road operations, he said licenses could be issued within seven days at a maximum after all required documents had been received by the BKPM.

Rido Matari Ichwan, expert on economy and investment at the Public Works and Public Housing Ministry, said the minister had delegated seven types of permits related to the sector '€” investment permits on toll roads and water and business permits on property, real estate, foreign construction operators, foreign construction consultants and foreign construction services.

'€œBusiness permits for property and real estate can already be processed online, while the foreign construction services permit process is dealt with by the ministry'€™s officials at the BKPM,'€ he explained.

During the promotional event, property developers grouped under Real Estate Indonesia (REI) criticized the long and complicated process of permit issuance in the sector, claiming that for one project, they had been required to file proposals for 44 permits with regional administrations.

'€œWe have a backlog of 15 million houses each year, but the complex bureaucracy has stopped us fixing the problem and helping the government. We demand that the 44 permits be reduced to 10 only,'€ Dadang Juhro, REI'€™s central advisory board deputy chairman, said.

In response, Rido said the ministry would implement a nationwide policy to simplify the 44 permits, while saying that '€œother relevant and specific permits have been much simplified; opening a toll gate for real estate will now take more than a month'€.

Meanwhile, the Transportation Ministry has also delegated the issuance of six permits to the BKPM, including business permits for scheduled and non-scheduled air transportation.

Muzdalifa, sub-directorate head of business development and guidance for air transportation at the ministry, said all investors were now allowed to file proposals directly to the BKPM.

'€œIn scheduled and non-scheduled air transportation, permits will need a maximum of 30 days, although investors are still required to provide legal documents,'€ she said.

Muzdalifa said further that permit procedures at the Transportation Ministry were still semi-manual, but that it was currently arranging the online-based service and expected it to be completed by the end of this month.

'€œWe are also preparing online-based permits for business operations and flight routes. Moreover, we'€™ve already opened online-based flight approval,'€ she added.

In addition, Muzdalifa said the online system would be synergized with the BKPM'€™s one-stop service in terms of basic permits.

Indonesia'€™s realized investment for the period of January-December last year reached Rp 463.1 trillion, exceeding a previous target of
Rp 456.6 trillion and up by 16.2 percent from Rp 398.6 trillion in the same period of 2013, BKPM data show.

The BKPM expects total investment in 2015 to reach Rp 516.5 trillion, made up of Rp 343.7 trillion in foreign direct investment and Rp 175.8 trillion in domestic direct investment.