Entrepreneurs Ask for Simplification of Retail KBLI

The Association of Indonesian Retailers and Shopping Center Tenants (Himpunan Peritel dan Penyewa Pusat Perbelanjaan Indonesia – “HIPPINDO”) assessed that the ease of doing business in Indonesia is the cause of a number of retail businesses closing down in recent times. The Chairperson of HIPPINDO, Budiharjo Iduansjah, revealed that the complexity of regulating physical stores is the cause of their inability to compete with online stores that tend to be free in selling goods..

“Because the online ones are too free, while the offline ones are too strict,” Budiharjo told Hukumonline.

Budiharjo encouraged the government to simplify business licensing, especially for physical retailers in selling retail. According to Budiharjo, the Indonesian Standard Classification of Business Fields (Klasifikasi Baku Lapangan Usaha Indonesia – “KBLI”) that physical retailers need to register is too much for each type of product sold. Meanwhile, in online retail, store owners are free to sell various types of products through one account without having to register the KBLI like physical retailers.

“We want the KBLI to be simple (for) retail. Here, there are so many KBLI that must be fulfilled. Every time you add goods, for example adding clothes, you have to add the KBLI for clothes,” he said.

Budi admitted that he had conveyed the input to the Ministry of Trade and related Ministries/Institutions. He supports the government's discourse on improving regulations for the retail business sector.