Business Owners in Bali: Here’s Everything You Need to Know About OSS
OSS is Indonesia’s national system for business licensing, managed by the Indonesia Investment Coordinating Board (BKPM). Photo Source: https://oss.go.id/
Are you planning to start a business in Indonesia? Then, perhaps you’ve come across the OSS system, and if you haven’t yet, you’re likely to during the process of setting your business up. The OSS is a digital platform that has transformed the way that business licenses are obtained across Indonesia. Whether your plans are opening a restaurant in Canggu, or starting a villa rental business in Seminyak, you need to understand what the OSS system is and how it works to make sure you stay compliant.
What is the OSS System?
OSS stands for Online Single Submission (Sistem Pelayanan Terpadu Satu Pintu Online in Indonesian). It was launched by the Indonesian government in 2018 as an integrated digital platform that allows businesses to get permits and licenses, all through one single online portal, rather than by visiting multiple government offices.
It was made to streamline Indonesia’s famously complex bureaucracy, and as a means of reducing processing times and improving transparency in business licensing. Since being implemented, it has saved considerable time for business owners who no longer need to go between different agencies for different permits or in order to track progress and receive approvals.
What’s the OSS Platform Used For?
You can use the OSS platform to get access to multiple government agencies and find out more about their licensing requirements. When you submit a business license application, the system will automatically send your request to the necessary agencies, according to what your business activities are and which location you’re in.
Here’s what you can do with the OSS:
Automated Processing: Many business licenses can be approved automatically if your application meets the requirements.
Track Your Application: You can check your application status and will receive updates as your application moves through different stages of approval.
Check Your Compliance: The system checks your business activities against zoning regulations, including environmental requirements and other compliance areas before giving you a license.
Find Your Documents Digitally: All permits and licenses are issued digitally which reduces paperwork and makes renewing licenses easier.
KBLI Codes and The OSS:
KBLI Codes are business activity codes that classify what your company does. Each business activity has its own KBLI code, and when you register on the OSS system, you need to make sure you register under the right code for your business.
Some examples of KBLI codes are:
KBLI 68111: Real estate activities with own or leased property
KBLI 55900: Other accommodation services (including villa rentals)
KBLI 56101: Restaurants and food service activities
KBLI 70209: Other management consulting activities
Making sure that you input the right KBLI codes from the start is important because they will tell you which permits you need and which kinds of activities you can legally conduct in your business.
Property Investors - Take Note: OSS and Zoning for Villa or Property Rentals:
In Indonesia, all business licenses are issued through the OSS (Online Single Submission) system, which uses KBLI codes to classify business activities.
If you are planning to start a property rental business, it’s important to learn about the relationship between OSS and zoning regulations, as this could save you from costly mistakes. The OSS system issues business licenses under specific KBLI codes, but these have to match the property’s zone.
Before you buy leasehold rights or invest in any kind of property for commercial use, you need to check that it's the right zone for whatever your planned business activities are. This is important because if you submit an application on the OSS for properties in green or yellow zones, you typically won’t be able to get a commercial license through the OSS. That’s because rental properties aren’t allowed in green (conservation/agricultural) zones or yellow (residential) zones. Some yellow zones might still allow commercial use like short-term rentals, but it’s essential to verify via the zoning system before proceeding.
If you want to check whether a property would make a suitable investment, you can check if the OSS system allows KBLI code registration for that specific address. Many zoning maps, especially those in Southern Bali, are now integrated into the OSS platform which means that the verification process should be easier.
Another important thing to remember is that your business license is tied to a specific address. What this means is that even if you have a valid business license for one property, you won’t be able to use it to operate commercially in a different location without first approving the zone of the new address on the OSS system.
Important Update from June 2025: Increased Monitoring
Bapenda (which stands for the Badan Pendapatan Daerah – Regional Revenue/Tax Agency) has increased its monitoring activities, especially of businesses involved in renting out properties for daily stays. This development had some important implications for villa owners and property managers.
What's Happening?
Bapenda is currently confirming that the villa you’re renting is registered in your company’s OSS system as a business premise, and that the correct KBLI classification is associated with it.
Who's Affected? If your business owns or manages villa rentals, Bapenda is specifically scrutinizing whether your KBLI codes (especially 55900) are valid for your property locations, and if these are properly reflected in the OSS system.
If you want to avoid any compliance issues, make sure that:
Your business KBLI codes match your actual activities
These codes are valid for your specific property locations according to OSS zoning requirements
You input your business information accurately in the OSS system
Your local tax obligations with Bapenda are properly filed
If you fail to align your company's KBLI codes with zoning regulations and actual operations, this could result in restrictions on your operations, or tax issues.
Common Challenges With OSS:
Although the OSS has made Indonesia’s business licensing landscape simpler and more straightforward, there still are some common challenges:
Technical Problems: Sometimes the platform experiences technical issues that can delay your application. As such, make sure you allow extra time for any delays.
Foreign investors may encounter certain challenges in the OSS system, such as language barriers, zoning compatibility, and occasional system errors.
Misalignments between Official Government Databases: In some cases, OSS (Online Single Submission) may display one type of zoning for a property, while the land department system reflects another. Although the OSS is intended to be the authoritative source - since it integrates the official RDTR/RTRW data managed by the central government - it's still vital to conduct comprehensive due diligence to confirm the actual zoning status.
Complex Requirements: If your business activities are classified as high-risk, the OSS system will issue your NIB (Business Identification Number), but you must also apply for industry-specific operating permits through relevant ministries or regional authorities to begin commercial operations. Each of these permits comes with its own compliance requirements, such as environmental approvals, building permits, or sector standards, and typically still need to be processed in Jakarta or via centralized government agencies.
Language Barriers: The system operates in Indonesian. If you can’t speak Indonesian, you will likely need some professional help with it.
Zoning Complications: As we mentioned earlier, if there are zoning restrictions on your property or location, it can create unexpected obstacles to undertaking your business activities.
Best Practices for OSS Success
To make sure that you have success when using the OSS:
Get together all required documents before starting your application. Incomplete submissions may face delays or rejections.
Research your intended business activities thoroughly and select the correct codes. If you’re not sure, reach out to us for professional help or seek advice.
If your business is location dependent, check that your zone is compatible before making any contractual commitments.
Regulations and system requirements change frequently, so it’s important to always stay updated with changes that may affect your business.
Once you get your license, keep it by maintaining compliance. If you do, you’re likely to avoid further inspections or audits.
Using the OSS Without Stress
The OSS has made getting business licenses much easier, but it also needs to be used carefully and with adequate preparation. If you run a property related business, then understanding OSS licensing, KBLI codes and zoning regulations is important, and may require the help of an expert or professional.
As Bapenda is stepping up their monitoring of businesses, it’s never been more important to ensure that you are compliant and that your business activities are properly reflected on the OSS. Not doing so can pose a risk to your business that simply isn’t worth taking.
If you need assistance with using the OSS, understanding zoning regulations or the latest requirements for businesses, our friendly experts would be more than happy to help. We can make sure that your business is properly licensed and compliant. Simply reach out to us via Whatsapp or email, or feel free to drop by to our office in Pererenan to schedule an appointment today. Together, we can make sure you’re set up for success from the start!
Written by Bali Solve Team
29th July 2025
