Building Permit for Foreign Investment in Indonesia – A Complete 2025 Legal Guide by The Bali Lawyer
Investing in property development or construction in Indonesia as a foreign entity requires more than capital—it demands legal compliance. One of the most important requirements is securing a valid building permit. In 2025, Indonesia enforces strict construction and zoning laws that apply to all developers, including foreign investors operating under a PT PMA (Foreign Investment Company).
At The Bali Lawyer, we specialize in assisting foreign investors in navigating the building permit process in Indonesia. This guide outlines everything you need to know about obtaining a PBG (Persetujuan Bangunan Gedung)—Indonesia’s official building permit—for foreign-owned projects.
What Is a Building Permit (PBG) in Indonesia?
A PBG (Persetujuan Bangunan Gedung) is a legal authorization issued by the local government that allows you to construct, renovate, expand, or modify a building. It replaces the previous IMB (Izin Mendirikan Bangunan) and is mandatory for all building activities across Indonesia.
For foreign investors, the PBG ensures that:
The building complies with national and regional spatial planning
Your investment follows construction safety, design, and usage laws
You are eligible to apply for further licenses, such as SLF (Sertifikat Laik Fungsi), utility connections, and operational permits
No construction can begin without a valid PBG.
Who Needs a Building Permit?
Foreign investors who plan to:
Build a villa, resort, hotel, factory, or any commercial property
Renovate or expand an existing property
Construct a mixed-use development
Develop land under a PT PMA structure
must apply for a PBG through the OSS RBA system (Online Single Submission – Risk-Based Approach), the Indonesian government’s centralized business licensing platform.
Legal Structure Required for Foreign Investors
Foreigners cannot own land or build property in Indonesia under individual names. To obtain a PBG, you must first:
Establish a PT PMA (Foreign-Owned Company)
This entity allows you to legally own building rights (HGB) and develop land in Indonesia.Secure Land Rights Through HGB (Hak Guna Bangunan)
HGB provides you the right to use the land for building purposes under a leasehold arrangement, typically valid for 30 years with extensions.
Our legal team assists with both PT PMA establishment and HGB land acquisition to set a solid foundation for your building permit process.
PBG Requirements for Foreign Investment in Indonesia (2025)
To obtain a building permit as a foreign investor, you must provide the following:
1. Proof of Land Rights
HGB certificate (Hak Guna Bangunan)
Lease or usage agreements, if applicable
Land certificate or AJB (Sale and Purchase Deed)
You must legally control the land either through ownership (HGB) or leasehold agreements.
2. Zoning and Spatial Planning Approval (KKPR)
KKPR (Kesesuaian Kegiatan Pemanfaatan Ruang) verifies that your intended building activity is allowed on the specific land plot according to spatial and zoning laws.
This approval must be obtained before you apply for a PBG.
3. Company Legal Documents
You will need to submit documentation of your PT PMA including:
Deed of establishment
Business registration number (NIB)
NPWP (Tax ID)
Company domicile letter
Articles of Association
These prove your legal status to operate as a foreign business in Indonesia.
4. Technical Drawings and Construction Plans
All building plans must be created by licensed architects and engineers and must meet Indonesian national standards (SNI).
Required drawings include:
Site plan
Floor plans
Elevations and cross-sections
Structural details (foundations, columns, beams)
Electrical, mechanical, and plumbing layouts
Fire safety and evacuation plans
Drainage and sanitation system
Accessibility and public safety features
As-built documents must be submitted for review and approval.
5. Professional Licenses
All plans must be signed and stamped by professionals with valid SIPB (Surat Izin Praktik Badan), showing they are certified and authorized to perform construction design and supervision in Indonesia.
We connect foreign clients with trusted professionals who meet these legal criteria.
6. Risk-Based Classification
Buildings are classified based on size, function, and public impact:
Low risk – Single-family villas, small offices
Medium risk – Hotels, commercial spaces
High risk – High-rise buildings, hospitals, malls
Your building’s classification affects the permit process and inspection requirements.
7. OSS RBA Submission
All documents are submitted through the OSS RBA platform. Your company’s NIB must be active before submission.
Steps include:
Inputting land, building, and business data
Uploading technical drawings
Declaring construction timeline
Completing a self-assessment checklist
Tracking approval status
We manage your OSS RBA submission from start to finish to prevent rejection due to missing or incorrect information.
8. Declarations and Compliance Forms
You must sign legal declarations stating that:
You will construct the building in accordance with approved plans
All documents submitted are accurate
You accept liability for any non-compliance
These statements are mandatory to validate your PBG application.
Construction Inspections and Compliance
Before final approval, the local government may inspect the construction site and technical drawings. They verify compliance with:
Safety and fire regulations
Environmental sustainability
Public accessibility
Building functionality based on intended use
Our legal and engineering team prepares your project for inspection to ensure a smooth approval process.
SLF – Next Step After PBG
After obtaining your PBG and completing construction, you will need to apply for SLF (Sertifikat Laik Fungsi)—the building’s function worthiness certificate. It confirms the building is safe, usable, and aligned with legal standards.
We assist with this second-stage process, including as-built documentation, site inspection, and certification submission.
Why Work with The Bali Lawyer?
Navigating the legal and bureaucratic processes in a foreign country can be complex and time-consuming. The Bali Lawyer offers complete legal support for foreign investors, ensuring all permits and approvals are secured legally and professionally.
We provide:
End-to-end legal assistance from PT PMA to SLF
Licensed architects and consultants for design and compliance
Zoning and land-use analysis
OSS RBA platform management
Representation during inspections and agency coordination
Whether you’re developing a resort in Bali, an office in Jakarta, or a commercial space in Lombok, our team ensures your project moves forward legally and securely.
Common Pitfalls to Avoid
Starting construction without PBG
Using unlicensed professionals for drawings
Building in restricted zones
Submitting incomplete documents to OSS
Ignoring SLF certification after construction
Avoid these costly mistakes by working with legal experts who understand the system.
Timeframe and Cost Overview
The timeline for obtaining a PBG may vary depending on the building’s complexity, location, and documentation readiness.
Simple projects: 3–4 weeks after complete submission
Complex or high-risk projects: 2–3 months, including inspection and review
Costs depend on project scope, location, professional fees, and legal services. We offer transparent pricing and service packages to suit your investment goals.
Ready to Build in Indonesia?
A building permit is not just a legal requirement—it’s the foundation for protecting your investment. Without it, your property may face usage restrictions, demolition orders, or government penalties.
As your legal partner, The Bali Lawyer ensures that your building project complies fully with Indonesian laws, from land acquisition to final certification.