Prepared by MATRADE Jakarta, Feb, 2019

Coordinating Board (BKPM) head Thomas Lembong has admitted that the online single submission (OSS) system needs to overcome various challenges to accelerate licensing proceedures for investors. “There are still many challenges. We are encountering many difficulties,” said Thomas in Jakarta on Wednesday, as quoted by kompas.com, adding that the software, for example, should be upgraded to meet the requirements. The connectivity of the system and the government institutions involved should also be improved, Thomas added. Launched in mid-2018, the OSS system was initially run by the Office of the Coordinating Economic Minister, because the BKPM was not ready to operate the system. Only on Jan. 2 did the BKPM take over the OSS system’s operation. Thomas said the OSS system would be overhauled soon. “The new phase of the OSS will be introduced in March,” he said, adding that in this phase, the OSS system would facilitate license issuance for large projects in the regions, as it would coordinate licensing arrangements between central and regional administrations. “The OSS system will become an interministerial and interinstitutional online coordination platform. On the platform [the institutions] can engage in joint efforts to face challenges to investment.” Despite the OSS system being in operation, realized investment amounted to only Rp 721.3 trillion (US$51.62 billion) in 2018, missing the target of Rp 765 trillion. Thomas expressed optimism, however, that Indonesia could achieve the investment target of Rp 792 trillion this year. “We have seen signals of recovery this year after the significant slowdown in growth in 2018,” he added. – Jakarta Post, 7 February 2019

 Observation:

The OSS, which designed to expedite business licensing procedures, it will definitely help Malaysian companies to better understanding the procedures of investing in Indonesia besides than easier coordination of business processing. According to the system, any investors will no longer need to apply for fiscal incentives as the system would automatically verify those who are qualified to receive it through verified investment documents. Hopefully the OSS system will be rectified soon to accommodate the necessity of Malaysian investment and entrance of Malaysian products to Indonesia.