Formal Revocation of PP 5/2021

Government Regulation Number 5 of 2021 on the Implementation of Risk-Based Business Licensing, hereinafter referred to as PP 5/2021, has been officially revoked and declared no longer valid following the enactment of Government Regulation Number 28 of 2025 on the Implementation of Risk-Based Business Licensing, hereinafter referred to as PP 28/2025, on 5 June 2025.

The issuance of PP 28/2025 marks a new chapter in the governance of business licensing in Indonesia. While still employing a risk-based approach, the new regulation introduces a more centralized and coordinated system, and explicitly governs the transitional provisions for licenses that were issued or are still in process under PP 5/2021.

A New Policy Direction: More Comprehensive, Yet Centralized

PP 28/2025 offers a more comprehensive framework for managing business licensing, yet it also reflects a clear shift toward centralized authority. This can be seen from the transfer of most assessment, verification, and licensing issuance processes to the central government level, including the strengthening of the OSS system and integration with other national systems.

This policy aims to improve administrative efficiency, legal certainty, and eliminate overlapping regulations and institutional mandates. However, both ongoing businesses and potential investors should pay close attention to this shift to avoid administrative or legal obstacles during the transition period.

Transitional Provisions: Treatment of Existing and Pending Licenses

To ensure business continuity during the transition period, PP 28/2025 explicitly stipulates the treatment of licenses already issued, pending, or not yet effective. These provisions are critical to understand, as they directly affect the legal rights and obligations of business actors.

As of the effective date of PP 28/2025:

1. Basic requirements, Business Licensing (PB), and/or Business Licensing to Support Business Activities (PB UMKU) that are under application process until the OSS System is adjusted in accordance with this Regulation, shall continue to be processed under PP 5/2021;

2. Business activities classified as medium-high risk that have obtained:

   1. Standard Certificate but are not yet verified; and/or

   2. PB UMKU but not yet effective,shall continue to be processed under PP 5/2021 until the adjusted OSS System becomes operational.

3. Business activities classified as high risk that have obtained:

   1. Expedited permits but have not fulfilled the requirements; and/or

   2. PB UMKU but not yet effective,shall also continue to be processed under PP 5/2021 until the adjusted OSS System becomes operational.

4. Government institutions responsible for developing, regulating, and supervising futures trading shall continue to carry out business licensing related to digital financial assets including crypto assets and financial derivatives until the transfer of supervisory duties is completed pursuant to the relevant laws and regulations.

5. OSS Access and License Validity

   1. Business actors who obtained OSS access prior to the enactment of this Regulation must update their access data in the OSS System;

   2. Upon such update, the OSS System shall notify the business actor via the registered email address.

6. For licenses already issued:

   1. The implementation of Risk-Based Business Licensing (PBBR) under this Regulation does not apply to business actors whose basic requirements, PB, or PB UMKU have been issued, verified, or approved and are still valid before this Regulation comes into force — unless the provisions under PP 28/2025 are more favorable to the business actor;

   2. Basic requirements, PB, and/or PB UMKU issued under different nomenclature prior to this Regulation must be interpreted according to the terminology used in PP 28/2025;

   3. Tourism businesses categorized as medium-high or high risk that have obtained Standard Certificates shall remain valid as long as the business continues to operate in accordance with applicable regulations, with the following requirements:

      1. Administrative update through the issuing tourism certification body and surveillance transfer mechanism;

      2. Upload of the valid Standard Certificate into the OSS System.

7. General Provisions

   1. All existing laws and regulations regarding basic requirements, PB, and/or PB UMKU shall remain valid so long as they do not contradict the provisions of PP 28/2025;

   2. PP 5/2021 is formally revoked and declared no longer in effect.

Implementation and System Adjustments

Article 551 of PP 28/2025 sets out technical implementation deadlines:

1. Implementing regulations must be issued no later than four (4) months from the date of enactment;

2. The OSS System and Indonesia National Single Window (INSW) must be adjusted in accordance with PP 28/2025 within four (4) months of enactment;

3. If business licensing for export/import activities, trade restrictions, and commodity balances cannot yet be processed through the INSW, licensing shall be conducted via the relevant ministerial or agency electronic systems, pursuant to applicable laws.

Conclusion

PP 28/2025 represents more than just an administrative change; it is a systemic transformation of Indonesia’s national licensing policy. The Regulation reinforces the centralization of licensing processes and introduces a comprehensive transition mechanism that must be adhered to strictly to avoid legal exposure.

Business actors and investors are urged to immediately assess the status of their current licenses, update OSS access data, and align with the new structure and terminology. Diligent attention to this transition period is essential to ensure compliance and uninterrupted business operations.