OSS System Indonesia: A Simple Guide for Business Owners

Understanding the OSS System in Indonesia 

Are you planning to set up a business in Indonesia? Whether you’re opening a restaurant in Bali, starting a villa rental in Sumbawa, or running a consulting firm in Jakarta, you’ll need to understand the OSS system in Indonesia. 

The Online Single Submission (OSS) platform has transformed the way business permits and licenses are obtained, making the process faster, more transparent, and easier to manage. But to stay compliant, it’s important to know how the system works, what KBLI codes mean, and how zoning regulations affect your business. 

What is the OSS System? 

The OSS system was launched by the Indonesian government in 2018. It is a centralised digital platform that allows businesses to apply for permits, track approvals, and maintain compliance—all in one place. 

By reducing bureaucracy and streamlining the process, OSS helps business owners save time while ensuring transparency in licensing. 

What Can You Do with the OSS Platform? 

The OSS platform connects businesses to multiple government agencies, ensuring licensing is accurate and compliant. Key features include: 

• Automated Licensing: Many applications are approved instantly if requirements are met. 

• Application Tracking: Monitor the status of your business license in real time. 

• Zoning and Compliance Checks: The system cross-references your business activity with zoning and environmental regulations. 

• Digital Licenses: All permits are issued electronically, making renewals simple. 

KBLI Codes and OSS Licensing 

Every business in Indonesia is classified under a KBLI (Klasifikasi Baku Lapangan Usaha Indonesia) code. Selecting the correct code is crucial as it determines your permitted activities and required licenses. 

Examples of KBLI codes include: 

• KBLI 68111: Real estate activities with owned or leased property 

• KBLI 56101: Restaurant and food service activities 

• KBLI 70209: Management consulting services 

Tip: Choosing the wrong KBLI code can lead to compliance problems, rejected applications, or tax complications.  

OSS and Zoning for Property Investors 

If you plan to invest in property or operate a villa rental business in Bali, OSS compliance must align with local zoning rules. 

• Green zones (conservation/agriculture): No commercial activities allowed. 

• Yellow zones (residential): Limited permissions, sometimes short-term rentals are allowed. 

• Pink zones (tourism): Suitable for hospitality, restaurants, and rental properties. 

• Red zones (commercial): Area allocated for businesses, offices, shops, and commercial activities. 

Remember: OSS licenses are linked to a specific address. You cannot use the same license for multiple properties without updating the system. 

Recent Updates: Stricter Monitoring by Bapenda 

As of June 2025, the Regional Revenue/Tax Agency (Badan Pendapatan Daerah or “Bapenda” for short) has increased its monitoring of businesses registered in the OSS—especially villa rentals and accommodation providers. 

What Bapenda is Checking 

• Villas are correctly listed as business premises in OSS. 

• KBLI codes (e.g., 55900) match actual business activities. 

• Zoning and licensing are aligned with property use. 

• Local tax reporting is complete and accurate. 

Who’s affected? Business owners and property managers who operate rental villas or accommodation businesses. 

Common OSS Challenges for Business Owners 

Even though OSS has simplified licensing, some hurdles remain: 

• Technical delays – System downtime may hold up approvals. 

• Database mismatches – OSS data may not always match land/zoning department data. 

• Additional permits – High-risk industries still need sector-specific permits outside OSS. 

• Language barriers – OSS operates in Indonesian, often requiring professional assistance. 

Best Practices for OSS Success 

1. Prepare all required documents before submitting your application. 

2. Verify your KBLI code is correct and reflects your real business activities. 

3. Confirm zoning compatibility before signing contracts or investing in property. 

4. Keep up to date with regulatory changes. 

5. Maintain compliance to avoid audits, restrictions, or penalties. 

Using the OSS System Without Stress 

The OSS system has made obtaining business licenses in Indonesia far more efficient. However, compliance with KBLI codes, zoning regulations, and tax obligations must be taken seriously. 

At Smart Advisory Solutions, we help foreign investors and business owners navigate OSS licensing, zoning rules, and regulatory compliance. Ensure your business is properly set up from the start—so you can focus on growth. 

Get in touch today to ensure your OSS compliance and set your business up for success in Indonesia.