Introduction

Business licensing in Indonesia is now strictly time‑bound under the Online Single Submission (OSS) system. If ministries or agencies fail to respond within the prescribed timeframe, licenses can be automatically approved (fiktif positif). This mechanism is no longer theoretical it is digitally enforced and already applies to 258 KBLI sectors. Businesses must understand when approvals are automatic and what obligations remain post issuance.

1 .Transforming Business Licensing: The Shift to SLA Driven Approvals under OSS

Indonesia’s business licensing regime has undergone a structural shift. Through the OSS system, licensing processes that previously depended on open‑ended administrative discretion are now governed by mandatory service timelines (Service Level Agreements  SLA).

OSS integrates licensing processes across ministries, agencies, and regional governments, ensuring that applications are processed within predefined time limits. Where no decision is issued within the applicable SLA, the system itself is empowered to proceed with approval.

2. Mandatory Time Limits for Ministries and Agencies       

Under Government Regulation No. 28/2025, government authorities are legally required to complete verification of licensing requirements within sector‑specific timelines.

For medium‑high risk business activities, this obligation is stipulated under Article 222(6). For high‑risk activities, the same obligation applies under Article 227(6). These provisions remove the possibility of indefinite delays in licensing review.

3. Automatic System Takeover in Case of Delay

BKPM Regulation No. 5/2025, operationalizes these obligations through OSS.

If an authority fails to complete verification within the allocated time:
OSS automatically blocks further action by the authority, and Proceeds to the approval stage of the relevant license.       

This mechanism applies to both medium‑high and high‑risk business activities, ensuring that regulatory silence does not halt business operations.

4. Fiktif Positif: Automatic Approval by Operation of Law   

The concept of fiktif positif is rooted in Indonesian administrative law under Law 30/2014, as amended by Law 6/2023. In essence, where no administrative decision is issued within the statutory timeframe, the application is deemed approved.

GR 28/2025 translates this doctrine into a digitally enforceable rule within OSS. If verification is not completed on time: The system automatically confirms compliance, and Issues the relevant legal authorization without further human intervention.

This represents a major shift: fiktif positif is no longer procedural it is executive and immediate.

5. Licenses That Can Be Issued Automatically

The OSS system differentiates automatic issuance based on business risk level:

a. Automatically Issued Upon Submission            

• Medium low risk activities: NIB, Standard Certificate (self‑declaration), SPPL
• Low risk activities: NIB and environmental documentation (SPPL).

b. Automatically Issued Due to Missed Deadlines (Fiktif Positif)

• High risk activities: Definitive license issued automatically on behalf of the relevant authority.

Medium high risk activities: Standard Certificate deemed verified by the system.

6. Scope of Current Implementation

As of June 2025, fiktif positif has been applied to 258 KBLI sectors across multiple ministries, including:

• Manpower
• Industry
• Marine Affairs and Fisheries
• Tourism and Creative Economy
• Energy and Mineral Resources
• Agriculture

This confirms that automatic approval is already actively in force across a wide range of industries.

7. No Single Deadline: Sector Specific Timelines Apply

There is no universal SLA for all licenses. Processing timelines vary depending on: Sector, Risk level, KBLI classification. Authoritative timelines are set out in Appendix I of Government Regulation No. 28/2025. Businesses should assess applicable deadlines carefully for each activity.

8. H-1 Control Mechanism to Prevent Unintended Automatic Approvals

To minimize unintended automatic approvals, the regulations require authorities to issue verification outcomes no later than one day (H‑1) before the SLA expires. If this obligation is missed, OSS automatically escalates the application for approval, triggering fiktif positif by system.

9. Practical Implications for Businesses

a. Monitor OSS timelines closely: Automatic approval depends on strict compliance with submission requirements.

b. Ensure data accuracy: Automatic issuance does not eliminate post‑licensing compliance or potential audits.

c. Prepare for faster go‑live: Businesses may obtain legal authorization sooner than under previous regimes.

d. Expect stricter post‑approval supervision, especially for medium‑high and highrisk activities

Conclusion

Indonesia’s OSS framework has fundamentally reshaped business licensing by embedding legally binding timelines and automated approvals into the system. Under Government Regulation No.  28/2025 and BKPM Regulation No. 5/2025, bureaucratic inaction is no longer a barrier to licensing. For businesses, the key challenge is no longer waiting for approvals, but ensuring readiness, compliance, and operational discipline once licenses are automatically issued.

Contributor: Rezi Akmal | Legal Associate