Are you looking to establish a construction business or real estate office in Bali, Indonesia?
Navigating the requirements for establishing a PT PMA and understanding the KBLI Code 41012 can be challenging.
This blog post will guide you through the process of establishing your construction business in Bali, covering the scope of work under KBLI Code 41012, which includes the construction, maintenance, demolition, and reconstruction of office buildings, such as offices and home offices.
We’ll also discuss the role of real estate companies in developing office buildings for sale and the subclassifications BG002 and G1002, which encompass design and construction services for office buildings.
Overview
KBLI Code 41012 encompasses businesses involved in the construction, maintenance, and redevelopment of office buildings, including standard offices and office homes.
This category also includes the construction of office buildings for sale, undertaken by real estate companies, and activities related to the modification and renovation of these office buildings.
Legal Basis
The legal framework for businesses operating under KBLI Code 41012 is governed by the Regulation of the Minister of Public Works and Housing of the Republic of Indonesia No. 6 of 2021.
This establishes guidelines and requirements specific to the construction industry in Indonesia.
Type of License
The licensing for construction services under KBLI Code 41012 is detailed in BKPM Regulation No. 4 of 2021, Article 12, which outlines the investment value exceptions for foreign direct investments.
Businesses must meet a minimum investment threshold of IDR 10 billion, excluding land and building costs per business sector per project location.
Coverage of Service
The scope of service under this KBLI includes construction, maintenance, demolition, and rebuilding of office buildings such as offices and office homes.
It covers both the construction of new buildings and the renovation or redesign of existing structures to suit commercial purposes.
Business Scale, Land Area, and Risk Level
Businesses under this KBLI code are classified as large scale. The regulation does not specify a required land area.
The risk level associated with these construction activities is categorized as medium-high, reflecting the significant safety, environmental, and compliance considerations involved.
Authorities Granting Licenses
Licenses for businesses operating under KBLI Code 41012 are granted by national-level authorities, specifically the Ministry or the Head of the Agency responsible for foreign investments and construction services.
Requirements and Obligations for Business Licensing
To obtain a business license, companies must demonstrate their capability through standard assessments of business service capacity.
They are required to keep records of their business experience and adhere to strict standards concerning safety, health, sustainability, and environmental management.
These include quality standards for materials and equipment, safety and health at work, construction service procedures, quality of construction results, and operational and maintenance standards.
Social protection guidelines for workers and environmental management standards must also be followed according to legislation.
Resources:
- Indonesia Investment Coordinating Board (BKPM)
- Indonesian Minister of Public Works and Housing
- Government Regulation No. 5 of 2021 on Risk-Based Business Licensing
Frequently Asked Questions
- What benefits do businesses gain by operating under KBLI Code 41012 in Indonesia?
Businesses benefit from a clear regulatory framework, access to a growing market for office spaces, and potential tax incentives or subsidies for compliant projects, enhancing profitability and operational efficiency.
- What challenges might a company face when setting up a construction business in Bali under this KBLI code?
Challenges include navigating the complex regulatory environment, managing construction costs, dealing with logistical constraints on the island, and ensuring compliance with both local and national standards.
- What future trends are expected to influence the construction of office buildings under KBLI Code 41012?
Future trends include the increasing adoption of green building practices, the integration of smart technology in office designs, and the evolving needs of businesses for flexible workspaces that can adapt to changing work patterns.
- What is the maximum allowed foreign ownership for ASEAN and non-ASEAN construction service business entities (BUJK) in this sector?
Non-ASEAN foreign BUJK can own at most 67%, while ASEAN foreign BUJK can own at most 70% in this sector, as regulated in Government Regulation Number 5 of 2021.
- What is the duration for obtaining business licenses under this code?
The duration for obtaining business licenses under KBLI Code 41012 is 15 days.
Contact us for Construction PT PMA in Bali.
