The minister of home affairs recently enacted Regulation 22/2016, amending Regulation 27/2009 on the Guidelines for the Granting of Regional Nuisance Permits. The amendment is part of President Joko Widodo's policy to reduce the number of business permits and licences required to start a business. Regulation 22/2016 came into force on May 2 2016.
The amendment has introduced two important changes. Under Regulation 27/2009, environmental criteria were considered in nuisance permit applications. However, under Regulation 22/2016, such applications are assessed based only on social and economic criteria. Further, Regulation 22/2016 exempts upstream oil and gas businesses from the requirement to obtain a nuisance permit.
A nuisance permit is now required for all business activities, except:
- activities that take place in industrial, bonded and special economic zones;
- activities that take place in buildings which have already obtained a nuisance permit;
- micro and small businesses' activities that take place in buildings or on land parcels and will have no effect outside the building or land parcel; and
- upstream oil and gas business activities.
Applicants can submit a nuisance permit application to the regional government agency in the relevant city, regency or, in the case of Jakarta, province. Nuisance permits are valid for the duration of the relevant business activities, although they are subject to periodic renewal under several regional regulations.
Applicants must submit:
- an application form;
- a copy of their resident identity card (if an individual) or deed of establishment (if a legal entity); and
- a copy of their land ownership title.
The above requirements are subject to the relevant regional regulations and additional documents or forms may be required. Nuisance permit applications may also be subject to additional fees, as set out in the relevant regional regulations.
Regulation 27/2009 stipulates that nuisance permits must be issued within 15 business days from the date on which the application is declared complete and correct. Where the regional government fails to meet this deadline, an application will be deemed to have been accepted. Regions may set shorter timeframes – for example, in Jakarta the governor must issue nuisance permits within 10 business days from the date on which the application is declared complete and correct.
Regulation 27/2009 includes no penalties for the violation of nuisance permit provisions. Instead, it delegates this power to the mayor, regent or governor, as applicable. Depending on the relevant region's regulations, penalties can involve written warnings, fines or the suspension of business activities.
For further information on this topic please contact Adithya Lesmana at Ali Budiardjo, Nugroho, Reksodiputro by telephone (+62 21 250 5125) or email ([email protected]) The Ali Budiardjo, Nugroho, Reksodiputro website can be accessed at www.abnrlaw.com.