According to Article 1 paragraph 1 of the Trade Law, trade is defined as an activity that involves transactions of goods and services both domestically and abroad, with the aim of transferring rights to goods and services to obtain rewards or compensation.

According to Article 1 Paragraph 2 of MOT 36/2007, a trading company is any business that carries out business activities in the trading sector on a permanent, sustainable basis, established, working, and domiciled in the territory of Indonesia intending to make a profit.

A Trading Business License, also known as SIUP, allows a person to conduct trading business activities. All trading companies must have an SIUP. However, the concept of business licenses in Indonesia has changed since the Job Creation Law came into effect. For example, the current investment and business climate is better thanks to implementing risk-based business licensing.

According to Article 7 paragraph (1) of the Job Creation Law, the determination of risk level and business scale rating of business activities is the basis for risk-based business licensing. On the other hand, Article 7 paragraph (2) of the Job Creation Law stipulates the assessment of the level of hazard and the potential for hazard occurrence.

From this statement, business activities are determined to be low, medium, and high-risk business activities, with business licensing as follows:

1. Business licensing for low-risk business activities in the form of granting a Business Identification Number (“NIB”) which is the legality of implementing business activities.
2. Business licensing for medium-risk business activities consists of low medium-risk business activities and high medium-risk business activities. Business licensing for low-medium-risk business activities is in the form of granting NIB and standard certificates. Meanwhile, business licensing for medium-high-risk business activities is in the form of granting NIBs and standard certificates, which are issued by the central government or regional governments according to their authority based on the results of verification of the fulfillment of business activity implementation standards by business actors.
3. Business licensing for high-risk business activities is in the form of granting NIB and permits from the central government or regional governments for the implementation of business activities that must be fulfilled by business actors before carrying out their business activities. If high-risk business activities require the fulfillment of business standards and product standards, the central government or local government will issue business standard certificates and product standard certificates based on the results of verification of standard fulfillment.

As for the TDP, Article 1 letter a of Law 3/1982 stipulates that a Tanda Daftar Perusahaan (TDP) is a list of official records made according to or based on the provisions of Law 3/1982 and or its implementing regulations. The TDP must contain all matters that must be registered by every company and authorized by the authorized official of the company registration office. A company that has been authorized for registration in the company registry will be granted a TDP, as stipulated in Article 22 of Law 3/1982. However, Law 3/1982 was revoked and declared invalid based on Article 116 of the Job Creation Law. Thus, TDP is currently no longer required for companies.

Legal Basis:

1. Law Number 7 the Year 2014 on Trade;
2. Government Regulation instead of Law Number 2 of 2022 concerning Job Creation;
3. Law Number 6 of 2023 Concerning the Stipulation of Government Regulation instead of Law Number 2 of 2022 on Job Creation into Law;
4. Government Regulation Number 5 of 2021 on the Implementation of Risk-Based Business Licensing;
5. Regulation of the Minister of Trade Number 36/M-DAG/PER/9/2007 of 2007 on the Issuance of Trade Business License;
6. Regulation of the Minister of Trade Number 46/M-DAG/PER/9/2009 of 2009 concerning Amendments to the Regulation of the Minister of Trade of the Republic of Indonesia Number 36/M-DAG/PER/9/2007 concerning the Issuance of Trade Business License;
7. Regulation of the Minister of Trade Number 39/M-DAG/PER/12/2011 of 2011 on the Second Amendment to Regulation of the Minister of Trade Number 36/M-DAG/PER/9/2007 on the Issuance of Trade Business License;
8. Regulation of the Minister of Trade Number 07/M-DAG/PER/2/2017 of 2017 on the Third Amendment to Regulation of the Minister of Trade Number 36/M-DAG/PER/9/2007 on the Issuance of Trade Business License; 9;
9. Regulation of the Central Bureau of Statistics Number 2 of 2020 concerning the Indonesian Standard Business Field Classification.

Reference:

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