A discerning entrepreneur understands the indispensable importance of preparing all legal business documents before embarking on a new venture. These documents not only ensure compliance with regulatory standards and safeguard business continuity, but also cultivate trust among partners and customers.
Which legal documents must every entrepreneur possess? Key documents include the Certificate of Business Domicile (SKDU), NPWP, Trading Business License, NIB, SIUI, SIUP, and others. Below are 17 essential legal documents to prepare before launching your business.
The Importance of Legal Business Documentation
1. Legal Protection for Business Sustainability
Possessing official legal documents is far more than a mere formality. These documents form a protective legal foundation, shielding your business from future regulatory issues and ensuring long-term operational stability.
2. Enhanced Credibility, Professionalism, and Trustworthiness
Obtaining business permits elevates your company’s credibility, strengthens its professional image, and significantly enhances customer confidence in your products, services, or offerings.
3. Easier Access to Partnerships and Collaboration
To collaborate with legally established entities or government institutions, having complete and valid business permits is absolutely essential.
When seeking funding or presenting proposals to investors, these documents are always among the first prerequisites.
4. Eligibility for Government Assistance Programs
The government—both central and local—actively supports MSME development through various programs ranging from capital assistance to capacity-building initiatives.
To benefit from such programs, entrepreneurs must present valid legal documents establishing their business entity.
Only legally recognized MSME owners are eligible for these benefits.
17 Types of Legal Documents Required to Start a Business
1. Certificate of Business Domicile (SKDU)
The Certificate of Business Domicile (SKDU) is an official document issued by local authorities certifying that a business is legally established within a specific area.
It typically includes details such as business address, registration number, business type, and owner information.
This certificate is often required before acquiring other legal documents, such as NIB, TDP, or additional permits.
2. Taxpayer Identification Number (NPWP)
NPWP serves as the official tax identification number for individuals or legal entities.
Issued by the Directorate General of Taxes, it is required for all tax-related administration and reporting.
3. Trading Business License (IUD)
The Trading Business License is a mandatory administrative requirement for businesses operating in the trading sector.
It is issued by the local Department of Industry and Trade or the regional Licensing Office.
4. Permit for Business Location (SITU)
SITU certifies that your business location complies with zoning regulations and is legally recognized as a suitable place of operation.
5. Principle License
A preliminary approval issued by the government, serving as the initial green light for project development before acquiring more detailed permits.
6. Industrial Business License (SIUI)
SIUI authorizes industrial operations and confirms compliance with regional industrial regulations.
7. Trading Business License (SIUP)
SIUP is issued to businesses operating in the trading sector, certifying their eligibility to conduct commercial activities.
8. Company Registration Certificate (TDP)
TDP formally records the identity of your company, providing assurance of its legal recognition.
9. Industrial Registration Certificate (TDI)
TDI is required for businesses engaged in industrial activities, serving as formal registration for industrial operations.
10. HO / Nuisance Permit
This permit ensures that business activities will not cause disturbances to surrounding communities.
11. Building Permit (IMB)
IMB provides official authorization for constructing business premises and ensures compliance with building and planning regulations.
12. BPOM License
Mandatory for food and health-related businesses, this license confirms that products meet safety and regulatory standards.
13. Deed of Establishment (for Limited Liability Companies)
A notarial document that legally establishes the formation of a Limited Liability Company (PT), detailing ownership and corporate structure.
14. Business Identification Number (NIB)
NIB is a foundational business registration document issued by the Indonesia Investment Coordinating Board (BKPM).
It serves as the primary identity for all business entities and is required before obtaining any operational permits.
15. Trademark Intellectual Property Rights (HKI Merek)
Trademark protection secures your brand identity, safeguards product authenticity, and prevents unauthorized use.
16. Distribution Permit (Izin Edar)
This permit authorizes the distribution of products and ensures compliance with safety and quality regulations.
17. Halal Certification (MUI)
Mandatory for businesses producing or selling halal products, this certification validates compliance with Islamic dietary and production standards.
Not all 17 legal documents above are required for every business. Each type of venture may require a different set of permits. For deeper understanding, continue reading the next article on Business Legality and Business Documentation.
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