If you’re planning to invest in Indonesia, one of the first things you need to do is obtain an Izin Prinsip Penanaman Modal (IPPM) or Principle License for Investment. This license is essential for foreign investors who want to expand their businesses in the country.
What is Izin Prinsip Penanaman Modal?
The Izin Prinsip Penanaman Modal is a principle license issued by the Indonesia Investment Coordinating Board (BKPM) to foreign investors who want to invest in Indonesia. It is also known as the Principle License for Investment.
The IPPM is a preliminary license that allows investors to start their investment planning process in Indonesia. It is valid for 12 months and can be extended for another 12 months if necessary.
Once you obtain an IPPM, you can start exploring investment opportunities in Indonesia, such as setting up a company, acquiring a local company, or investing in a joint venture.
Why Do You Need an IPPM?
The IPPM is a crucial prerequisite for foreign investors who want to invest in Indonesia. It is the first step towards obtaining a complete investment license, called the Izin Usaha Penanaman Modal (IUPM) or Business License for Investment.
Without an IPPM, you cannot proceed with your investment plans in Indonesia. The BKPM requires foreign investors to obtain an IPPM before they can apply for an IUPM.
The IPPM serves as a guarantee that the BKPM has reviewed your investment plan and has deemed it feasible for implementation. It also ensures that your investment does not violate any of the country’s laws and regulations.
How to Obtain an IPPM?
Obtaining an IPPM is a relatively straightforward process. Here are the steps you need to follow:
Step 1: Submit Your Application
You can submit your IPPM application online through the BKPM’s Online Single Submission (OSS) system. You need to provide the following documents:
- A copy of your company’s articles of association
- A copy of your company’s business license
- A copy of your company’s tax identification number (NPWP)
- A copy of your company’s bank account statement
- A copy of your investment plan
Step 2: Wait for Approval
Once you submit your application, the BKPM will review your investment plan and determine if it is feasible for implementation. If your application is approved, you will receive an IPPM within five working days.
Step 3: Obtain Your IUPM
After obtaining an IPPM, you can proceed with applying for an Izin Usaha Penanaman Modal (IUPM) or Business License for Investment. The IUPM is a complete investment license that allows you to start your investment activities in Indonesia.
Conclusion
The Izin Prinsip Penanaman Modal (IPPM) is a crucial prerequisite for foreign investors who want to invest in Indonesia. It is a preliminary license that allows investors to start their investment planning process in the country.
If you’re planning to invest in Indonesia, make sure to obtain an IPPM before proceeding with your investment plans. The IPPM serves as a guarantee that your investment plan has been reviewed and deemed feasible for implementation by the Indonesia Investment Coordinating Board (BKPM).
By following the simple steps outlined above, you can obtain your IPPM and start exploring investment opportunities in Indonesia.
