CAPITAL INVESTMENT PROCEDURES

A. PMDN / Domestic Capital Investments

1. A prospective capital investor , who will conduct an undertaking in the framework of law number 6 of 1968 as already amended by law Number 12 of 1970, shall first study the list of business sectors, closed for capital investments , and if a further elucdation is required, the BKPM / Capital Investment Coordinating Boar or the BKPMD / Regional Capital investment Coordinating Board can be contacted.
2. After having conducted inadequate study concerning the business sectors which are open, and other provisions concerned the prospective capital investor forwards an application for capital investment to the MENINVES ( Minister of Investment Fund Mobilization ) / Chairman of the BKPM / Capital Investment Coordinating Board , by using the Application Procedures, stipulated by the MENINVES / Chairman of the BKPM
3. If said application is in accordance with the provisions of the legislative regulations and the prevailing conditions for Domestic Capital Investment, the MENINVES / Chairmen of the BKPM issues a Capital Investment Approval Letter, which is also effective as an Approval in Principle
4. To accelerate the capital investment process, the MENINVES/ Chairman of the BKPM for Wards a copy of the capital investment approval letter to involved Government Agency.
5. If the Capital investor has already obtained a Capital investment Approval Letter and after the stipulated conditions have been met, then :

   a.  The MENINVES/Chairman of the BKPM issues :

   1. A Limited Imported Identification Number ;
   2. A Decree for the granting of import duty facilities and other import levies;
   3. An approval for the RPTKA / Plan for the utilization of Expatriate Manpower required, as basis for the chairman of the BKPM in issuing a work permit for the expatriate manpower required ;
   4. A Permanent Business Permit / licence , on behalf of the minister , subordinating said undertaking , in accordance with the delegation of Authority

   b. The Head of the Regency / Municipality Agrarian Affairs Office issues a location Permit,In accordance with the
       space Lay – out Plan.
   c. The Head of the Regency / Municipality Agrarian Affairs Office issues HGB / Building Right Certificate , HGU
       /Undertaking Right Certificate and a management Right Certificate , in accordance with the prevailing provisions
   d. The Head of the public Works service of the Iind. Level Region , or the technical Work Unit , on behalf of the
       Regent / Municipal Mayor concerned , or the Head of the P2K / City Development Supervision service for the
       Jakarta Capital Special Region, on behalf of the Governor of the Jakarta Capital Special Region, issues an IMB /
       Building or Construction Permit.
   e. The secretary of the Iind. Level Territory / Region , on behalf of the Regent / Municipal Mayor concerned , Head of 
       the Bureau for Orderliness, on behalf of the Governor of the Jakarta Capital Special Region , issues the UUG / HO
       (Disturbance Ordinance Permit).

6. The obligation to have Disturbance Ordinance Permit is not valid for industrial companies , of Which the kind of industry is obligated to have an ANDAL / Environmental impact Analysis Ore which are located in an industrial Estate/Bonded Zone
7. After having obtained the Capital investment Approval Letter form the MENINVES / Chairman of the BKPM , the Capital Investor shall , within the stipulated time, forward to the BKPM , the Master List of Capital Goods and raw as well as auxiliary materials to be Imported.
8. Based on the evaluation of the Master List of Capital Goods and raw as well as auxiliary materials to be imported the MENINVES / Chairman of the BKPM issues a decree concerning the import duty facilities and other import levies.
9. Applications for amendments in the capital investment plan , which has already obtained an a approval from the MENINVES / Chairman of the BKPM , including amendments for project expansion , shall be forwarded by the capital investor to the MENINVES / Chairman of the BKPM to obtain his approval , by using the procedures as stipulated by the MENINVES / Chairman of the BKPM
10. The application of Domestic Investment ( PMDN ), supplemented by :

1. Copy Establishment deed of the company for PT, BUMN / BUMD, CV or Firm.
2. Copy NPWD ( Taxpayer Identification Number ) of the application.
3. Copy KTP ( Citizen Identity Card ) for individuals .
4. Description of the production process, supplemented by the process flow chard, and type ( s ) of raw auxiliary material for processing industries.
5. Description of the business activities for activities in service business.

B. PMA / Foreign Capital Investment

1. The prospective capital investor who will do business in the framework of Law Number 1 of 1967 as already amended by Law Number 11 of 1970 shall first study the prevailing List of Sectors Closed for Foreign Capital Investments. And if a further elucidation is required then the BKPM or BKPMD could be contacted.
2. After a sufficient study has been conducted concerning the oven business sector , and the other provisions concerned , the prospective capital investor submits a capital investment application to the MANINVES / Chairman of the BKPM by using the application procedure stipulated by the MENINVES / Chairman of the BKPM.
3. Based on the evaluation towards the capital investor’s application the MANINVWS / Chairman Of the BKPM forwards said application to the President accompanied with the considerations to obtain a Decree.
4. The Approval / Refusal of the President concerning a capital investment application is forwarded to the MENINVES / Chairman of the BKPM.
5. If the application obtains the approval of the President, the MENINVES / Chairman of the BKPM forwards a Notification concerning the Presidential Decree to the prospective capital investor , which shall also be effective as an Approval in principles.
6. To accelerate the capital investment process, he MENINVES / Chairman of the BKPM forwards a copy of the presidential Notification Letter to the Government Agency involved.
7. When the Capital Investor has already obtained the Presidential Decree constituting the Approval for the capital investment and after the stipulated conditions have been met;
   a. The MENINVES / Chairman of the BKPM issues:
   1. The Limited Importer Identification Number;
   2. A Decree for the provision of import Duty facilities and other import levies;
   3. The approval of the plan for the utilization of Expatriate Manpower (RPTKA) required as basis for the chairman of the BKPMD to issue the working permit for the required expatriate manpower;
   4. The permanent business permit on behalf of the Minister sub ordination said business, in accordance with the delegation of authority.
      The Head of the Agrarian Affairs Office of a Regency / Municipality issues a Location Permit in accordance with the Lay-Out Plan.

   b. The Head of the Agrarian Affairs Office of a Regency / Municipality issues the HGB /Building Rights and the HGU / 
       Undertaking Rights in accordance with the prevailing Provisions.

   c. The Head of the Public works service of the second Level Region on the Technical work Unit on behalf of the Regent /
       Municipal Mayor concerned or the Head of the P2K/ City Development Supervision Service for the Jakarta Capital
       Special Region on behalf of the Governor of the Capital Special Region issues the IMB / Building Construction Permit.

   d. The secretary of the Iind. Level Territory / Region on behalf of the Regent / Municipal Mayor concerned or the Head of
       the Bureau of Underliness for the Jakarta DKI on the behalf of the Governor , Head of the Jakarta Capital Special Region
       issues the UUG/HO ( Disturbance Ordinance ) permit.

8. The obligation to have a UUG / HO ( Disturbance ordinance ) permit shall not be effective for industrial companies of which the kind of industry is obligated to have an ANDAL or is located in an industrial Estate / Bonded Zone.
9. After the Capital Investment Approval Letter has been obtained from the MANINVES / Chairman of the BKPM , the capital investor within the stipulated period of tame shall forward to the BKPM a master List of the Capital goods and the raw – and auxiliary materials to be imported.
10. Based on the evaluation towards the master List of the capital goods and the raw – and auxiliary material, the MENINVES / Chairman of the BKPM issues the decree on the import duty Facilities and other import levies.
11. The application for an amendment on the plan for a capital investment which has already obtained a Presidential approval , including the amendment for a project expansion shall be submitted by the capital investor to the MENINVES / Chairman of the BKPM to obtain his approval by using of procedure stipulated by the MENINVES / Chairman of the BKPM.
12. The application of foreign Investment (PMA ), Supplemented by :

1. Power of attorney, in case of application is not conducted by the applicant himself .
2. Draft Joint venture agreement .
3. Copy Establishment Deed of the company for PT, BUMN / BUMD, CV or Firm .
4. Copy NPWP ( Taxpayer Identification Number ) of the application .
5. Copy KTP ( Citizen Identity Card ) of individuals for Indonesia participant .
6. Copy visas for Individuals Foreign participant .
7. Bank Reference for foreign participant of individuals .
8. Description of the production process, supplemented by the process flow card and type (s) of raw auxiliary material for processing industries .
9. Description of the business activities, for activities in service business .

C. Capital Investments in the Non – Oil – Gas Mining Sector and in the Forestry Sector

1. The application for a domestic capital Investment in the on – oil and gas mining sector shall be submitted to the MENINVES / Chairman of the BKPM:

   • Based on the work Contract between the prospective capital investor the Government. Cq . the Department of mining and energy for the exploitation of minerals of the strategic group;
   • Based on the Mining Licence for the exploitation of minerals of the vital group;
   • Based on a Regional Mining Permit for the exploitation of minerals of the non – strategic and non – vital groups ;

2. The application for a Foreign capital investment in the non – oil – and gas mineral mining sector in accordance with the prevailing legislative regulations shall be submitted to the MENINVES / Chairman of the BKPM based on a work Contract between the prospective capital investor and the Government cq. The Departement of Mining and Energy.
3. The application for capital investment of the non – oil – and – gas mining sector , including the application for an amendment in the capital investment already approved by the Government, shall be regulated and completed according with the prevailing provision.
4. The applications for domestic and foreign capital investments in the forestry sector shall be forwarded to the MENINVES / Chairman of the BKPM based on the Forest Exploitation Rights or the Timer Forest Exploitation Rights issued by the Minister of Forestry.
5. The application for capital investment in the forestry sector, including the applications for an amendment in the capital investment which has a already been approved by the Government, shall be regulated and completed according with the prevailing provisions.

D. Obligations of the Capital Investor .

1. Each Capital Investor shall conduct his capital investment in accordance with a already Approved provisions.
2. Each change in the implementation of the already approved provisions shall first obtain the Approval of the MENINVES / Chairman of the BKPM.
3. To obtain the approval as referred to the capital investor shall submit an application to the MENINVES / Chairman of the BKPM.
4. All capital investors shall submit a periodic report concerning the implementation of their Capital investment to the BKPM at stage of the project development as well as at the stage of business activities especially in the framework of the utilization of facilities in the reporting from and procedure stipulated by the MENINVES / Chairman of the BKPM .

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