Restaurant Business License Guide for Legal Operations in Indonesia

The restaurant industry in Indonesia has grown rapidly in recent years, supported by the country’s thriving tourism, urbanization, and food culture. From small family diners to upscale international chains, restaurants play a vital role in Indonesia’s economy.

However, to operate legally, every restaurant — regardless of size or concept — must hold a valid restaurant business license (izin usaha restoran). This license is not only a formality but also a legal obligation ensuring food safety, consumer protection, and business credibility.

This article will guide you through the types of restaurant permits, the licensing process, and the required documents you’ll need to operate your restaurant legally in Indonesia.

Why Restaurant Licensing Is Important

Operating a restaurant without proper licensing can expose your business to legal risks, fines, and even closure by authorities. Proper licensing provides several benefits:

1. Legal compliance: Ensures your restaurant operates within Indonesia’s business and food safety laws. 
2. Customer trust: Licensed restaurants are more likely to gain consumer confidence and attract repeat customers. 
3. Access to business benefits: Licensed restaurants can participate in government programs, open bank accounts, and expand with franchise or investment opportunities. 
4. Operational security: Avoids potential penalties, suspensions, or business shutdowns due to regulatory violations. 

In short, restaurant licensing is not just a regulatory step—it’s a foundation for sustainable business growth.

Types of Restaurant Permits in Indonesia

Depending on the type and scale of your restaurant, several permits may be required. These include general business licenses, food and beverage safety permits, and location-specific approvals.

1. Business Identification Number (NIB)

The NIB (Nomor Induk Berusaha) functions as your primary business license. It is obtained through the OSS (Online Single Submission) system and acts as your restaurant’s legal identity.

2. Commercial Operating License (Izin Komersial/Operasional)

This license allows your restaurant to conduct operational activities such as serving food and beverages to customers. It is mandatory for all restaurants regardless of size.

3. Environmental Approval (SPPL or UKL-UPL)

Restaurants that generate waste, emissions, or noise must submit an Environmental Management Document (SPPL, UKL-UPL, or AMDAL) depending on the business scale.

4. Building Use and Location Permit

You must ensure that your restaurant’s building complies with local zoning and building regulations. This includes a Building Use Certificate (IMB/PBG) and a Location Permit issued by the regional government.

5. Halal Certification (Optional but Highly Recommended)

If your restaurant serves Muslim customers, obtaining a Halal Certificate from the Halal Product Assurance Agency (BPJPH) and MUI is strongly encouraged to improve customer trust.

6. Health and Sanitation Permit

Local health authorities may require your restaurant to undergo inspections to ensure compliance with food hygiene and employee health standards.

Required Documents for a Restaurant Business License

Before applying for your restaurant license, make sure you have the following essential documents prepared:

Document	Description
Business Deed & Legalization	Company establishment deed legalized by the Ministry of Law and Human Rights.
Taxpayer Identification Number (NPWP)	Proof of company tax registration.
Business Identification Number (NIB)	Obtained from the OSS system.
Building Permit (IMB/PBG)	Verification that your restaurant location meets local building standards.
Lease or Ownership Agreement	Proof of right to use the restaurant property.
Environmental Documents (SPPL/UKL-UPL)	Depending on the size of your operations and waste output.
Health & Sanitation Certificate	Required for food handling and hygiene compliance.
Menu List & Food Source Information	To confirm compliance with food safety standards.
Halal Certificate (if applicable)	Proof that food preparation meets halal guidelines.

Restaurant Business License Guide for Legal Operations in Indonesia

Here’s a detailed step-by-step guide to obtaining a restaurant business license in Indonesia:

Step 1: Company Establishment

Before applying for a restaurant license, your business must first be legally established — either as a PT (Limited Liability Company) or CV (Commanditaire Vennootschap).

The establishment process includes drafting a Deed of Establishment, obtaining approval from the Ministry of Law and Human Rights, and securing a Tax ID (NPWP).

Step 2: Register on the OSS System

Next, register your restaurant through the Online Single Submission (OSS) system to obtain your NIB. The NIB acts as your restaurant’s main license and automatically registers your business with several relevant authorities.

Step 3: Secure Environmental and Building Approvals

Submit your SPPL or UKL-UPL environmental documents to ensure your restaurant adheres to sustainability standards.

Simultaneously, verify your Building Use Permit (PBG) and Location Permit to confirm that your premises are authorized for commercial restaurant operations.

Step 4: Apply for Operational License

Once your NIB and environmental documents are in place, apply for your Commercial Operating License (Izin Operasional). This license allows you to start serving customers officially.

Step 5: Obtain Additional Permits

Depending on your restaurant’s business model, you may need to apply for additional licenses such as:

• Alcohol Distribution Permit (if serving alcohol)
• Live Music Permit (if applicable)
• Halal Certification for Muslim-targeted establishments 

Step 6: Health and Safety Inspections

Before launching, local authorities will typically conduct an inspection of your restaurant facilities to verify hygiene, safety, and employee health compliance.

Step 7: Business Launch and Compliance Maintenance

After receiving all required permits, your restaurant is legally authorized to operate. However, compliance must be maintained through annual renewals, periodic inspections, and tax reporting.

Benefits of Having a Legal Restaurant License

Operating a legally licensed restaurant offers multiple strategic advantages:

1. Stronger Brand Reputation – Customers and investors are more confident in a business that meets legal standards. 
2. Ease of Expansion – Licensed restaurants can more easily open branches or franchise units. 
3. Partnership Opportunities – Legal status makes it easier to partner with delivery apps, hotels, or international investors. 
4. Access to Financial Services – Banks and financial institutions often require proof of licensing before approving business loans or accounts. 
5. Avoidance of Legal Sanctions – Non-compliance may result in temporary closure, fines, or even license revocation. 

Common Mistakes to Avoid

Many new restaurant owners make avoidable mistakes during the licensing process. Here are some of the most common:

• Operating before obtaining a complete license — even a soft opening requires legal approval. 
• Using a residential address as a business domicile. 
• Incomplete environmental or hygiene documents.
• Failure to renew permits on time. 
• Serving alcohol without a specific distribution permit.

Ensuring each legal requirement is met will save time, money, and future complications.

How Korsia Group Can Help

Korsia Group is a trusted legal and business consulting firm that specializes in helping local and foreign entrepreneurs obtain business licenses in Indonesia.

For the restaurant industry, Korsia Group provides end-to-end support including:

• Business structure setup (PT or PMA) 
• OSS registration and NIB issuance 
• Environmental and location permit assistance 
• Food safety and sanitation compliance 
• BPOM and Halal certification guidance 
• Legal renewal and post-licensing support 

Our team ensures your restaurant is fully compliant, allowing you to focus on what matters most — running your culinary business successfully.

Conclusion

Starting a restaurant in Indonesia is a promising venture, but success requires more than great food and ambiance — it demands legal compliance.

From obtaining an NIB through OSS to securing your Operational License, Environmental Approvals, and Health Certifications, every step must follow proper legal procedures.

By partnering with Korsia Group, you gain a reliable business consultant experienced in Indonesian licensing regulations, helping you navigate complex processes quickly and accurately.

A licensed restaurant is not just a compliant business — it’s a trusted, credible, and scalable enterprise ready to grow in Indonesia’s dynamic food and beverage market.