An industrial business license (IUI) is necessary for companies in Indonesia’s manufacturing or production sector. If you let it lapse, you might face serious problems, from legal penalties to a full operations shutdown. Find out below why staying up to date matters and how to renew your license to avoid risks.
Why having an active IUI is important
Keeping your industrial business license valid is not just a formality. Here is why an active license is crucial for your business:
Legal Compliance
An active license keeps your business compliant with Indonesian regulations. Operating without it may lead to legal action, fines, or forced closure.
Access to Permits and Government Services
Without a valid industrial license, you could lose access to essential services such as customs clearance, tax incentives, and government permits.
Business Credibility and Trust
Clients, partners, and investors check to see if your licenses are up to date. A valid license strengthens your credibility and supports long-term partnerships.
Smooth Audits and Inspections
Government audits are routine. A valid industrial business license makes the process easier and helps you avoid unnecessary penalties.
Many businesses tend to overlook getting or renewing their industrial business licenses. Specific sectors must stay alert and ensure full compliance to avoid bigger risks.
Read more: How to Seamlessly Obtain an Industrial Business License in Indonesia
Which business should have an active industrial business license
Not all businesses need an industrial license, but this license is mandatory if your company is involved in manufacturing, processing, or packaging. These sectors include:
- Manufacturing Units: Companies producing goods using raw materials or semi-finished goods.
- Processing Plants: Businesses that refine or treat materials, such as food, textiles, or chemicals.
- Assembly Lines: Operations involved in assembling components into finished products.
- Packaging Industries: Businesses that package goods for retail or distribution.
- Heavy Industries: Large-scale industrial operations including automotive, metal, and machinery.
The IUI is valid for five years from the date of issuance. To avoid penalties or legal issues, it must be renewed before the expiration date.
Consequences of missing the IUI renewal
Letting your industrial business license expire can create significant problems for your business. Here is what can happen:
- Fines and Legal Action: You may face penalties or legal issues for operating without a valid license.
- Blocked OSS Access: Inactive IUI may prevent you from accessing the OSS system and essential permits.
- Business Disruption: Authorities can halt your operations, causing delays and losses.
- Financing Difficulties: Banks and investors may deny funding without a valid license.
How to renew your industrial business license
Renewing your industrial business license requires proper planning and knowledge of your company’s risk classification. Since introducing the Risk-Based Licensing System (OSS RBA), the renewal process depends heavily on your business’s KBLI code and risk level.
Understand Your Business Risk Level
Before starting the renewal, determine your business’s risk classification:
- Low Risk: Requires basic documentation and self-declaration.
- Medium-Low Risk: Requires standard operating procedures and risk management statements.
- High Risk: Requires a more detailed evaluation, technical requirements, and strict compliance checks.
This classification is determined based on your KBLI (Indonesian Business Field Classification) code. If your KBLI has changed or your business activities have expanded, you must update it before applying for license renewal.
Step-by-Step Guide to Renewing Your IUI
Here are the key steps to ensure a smooth renewal process for your industrial license:
1. Check Your Current IUI Status
Log in to your OSS (Online Single Submission) account and review your industrial license’s expiration date and status.
2. Review and Update Your KBLI
Ensure your KBLI matches your current business operations. If necessary, update it to reflect any changes.
3. Prepare Required Documents
Depending on your risk level, gather documents such as:
- Company deed
- NIB (Business Registration Number)
- Previous IUI
- Operational plans or SOPs
- Risk analysis (for medium-high risk businesses)
4. Submit Renewal via OSS RBA
Log in to OSS and navigate to the renewal section. Upload your documents, fill in the required fields, and submit your application.
5. Obtain Your Updated License
Your renewal request will be processed, and OSS will notify you if additional information is needed. Once approved, download your renewed IUI and store it securely. Make sure all team members involved in compliance are notified.
Staying ahead of your IUI renewal ensures continuous legal operation and avoids unnecessary delays or disruptions.
Read more: Industrial business license guide: What permits are needed?
Stay compliant and renew your license on time
Keeping your industrial business license active is essential for avoiding legal trouble, business delays, and financial risks. Do not wait until the last minute! Trust InCorp Indonesia (an Ascentium Company) for a seamless industrial business license solution.
Why choose InCorp?
- Deep understanding of Indonesia’s licensing regulations and OSS system.
- Full-service support, including KBLI updates to document preparation and submission.
- We help you comply with your business’s risk classification.
- We ensure a fast and compliant process with a streamlined, professional approach to avoid delays.
Contact us today and let us handle the paperwork, so you can focus on growing your business confidently.
Frequently Asked Questions
Which businesses need an industrial business license (IUI)?
Companies involved in manufacturing, processing, assembling, or packaging—such as food, chemical, textile, or heavy industries—must have an active IUI to operate legally.
How long is an industrial business license valid?
The IUI is valid for five years from the date of issuance and must be renewed before it expires to avoid penalties or business disruptions.
What happens if a company misses its IUI renewal?
Expired licenses can lead to fines, OSS access restrictions, halted operations, and difficulty securing bank financing or investments.
How does a business renew its industrial license?
Businesses can renew their IUI through the OSS RBA system by updating their KBLI code, preparing required documents, and submitting the renewal online based on their risk level.
How can InCorp Indonesia assist with IUI renewal?
InCorp helps businesses with KBLI updates, document preparation, risk assessment, and OSS submissions to ensure a fast, compliant, and stress-free renewal process.
Get in touch with us.
What you'll get
A prompt response to your inquiry
Knowledge for doing business from local experts
Ongoing support for your business
Disclaimer
The information is provided by PT. Cekindo Business International (“InCorp Indonesia/ we”) for general purpose only and we make no representations or warranties of any kind.
We do not act as an authorized government or non-government provider for official documents and services, which is issued by the Government of the Republic of Indonesia or its appointed officials. We do not promote any official government document or services of the Government of the Republic of Indonesia, including but not limited to, business identifiers, health and welfare assistance programs and benefits, unclaimed tax rebate, electronic travel visa and authorization, passports in this website.
Verified by
Hotdo Nauli
Senior Legal & Delivery Manager at InCorp Indonesia
Hotdo heads the Legal and Delivery team at InCorp Indonesia, managing Product Registration, Legal Advisory, and Business Licensing. With over 8 years of experience, she focuses on compliance and integrity, ensuring all client operations align with Indonesian laws and regulatory standards, including contract reviews and sector-specific licenses. She is also a licensed advocate and a member of the Indonesian Advocates Association (PERADI).
