Procedures for Licensing Supervision in Ibu Kota Nusantara (Nusantara Capital City) under OIKN Regulation 1/2026
Authors
Overview
On 8 January 2026, the Head of the Nusantara Capital City Authority (Otorita Ibu Kota Nusantara – “OIKN”) issued OIKN Regulation No. 1 of 2026 on Procedures for Licensing Supervision in Ibu Kota Nusantara (“OIKN Reg 1/2026”). This regulation sets out the implementing framework for how OIKN will conduct supervision and follow-up actions in relation to licensing compliance in the IKN area, particularly in connection with risk-based business licensing (Perizinan Berusaha Berbasis Risiko – “PBBR”) processed through the Online Single Submission (“OSS”) system.
OIKN Reg 1/2026 also governs supervision of non-business licensing and non-licensing approvals, including the administrative sanctions regime, public complaint mechanisms, and procedures applicable in force majeure situations.
Scope of Supervision
OIKN Reg 1/2026 confirms that OIKN’s supervision may cover licensing issued through OSS as well as licensing within IKN issued by the East Kalimantan Provincial Government, the Penajam Paser Utara Regency Government, and the Kutai Kartanegara Regency Government, depending on the distribution of authority and the relevant licensing category. The supervision role is conducted through OIKN’s technical work units, and the OSS system plays a central role in the supervision workflow, including inspection documentation and follow-up actions.
Supervision of Risk-Based Business Licensing (PBBR)
OIKN Reg 1/2026 distinguishes between routine and non-routine supervision of PBBR. Supervision may be conducted through physical inspections or virtual visits, and inspection results must be recorded in the form of inspection minutes (berita acara pemeriksaan) through OSS. 1 The regulation also emphasizes compliance with “basic requirements” that typically support business operations, including Spatial Utilization Approval (Kesesuaian Kegiatan Pemanfaatan Ruang), environmental Approval (Persetujuan Lingkungan), and Building Approval and Certificate of Proper Function (Persetujuan Bangunan Gedung and Sertifikat Laik Fungsi).
Supervision of Non-Business Licensing and Non-Licensing Approvals 2
For non-business licensing and non-licensing approvals, the regulation provides that supervision is carried out periodically and may involve cooperation with the relevant issuing authorities where the licensing was issued by the East Kalimantan Province or the relevant regencies. OIKN Reg 1/2026 also allows the establishment of joint supervision teams, where required.
Administrative Sanctions and Enforcement
OIKN Reg 1/2026 establishes a structured administrative sanctions framework. For PBBR violations, OIKN may impose sanctions ranging from written warnings, temporary suspension of activities, administrative fines, and coercive measures (daya paksa polisional), to revocation of business licensing, certifications, and approvals. 3 Sanctions may also extend to revocation of basic requirements, PB, and/or PB UMKU, depending on the type of non-compliance. The regulation provides a staged warning system (including first, second, and third warnings, as well as a “first and final warning”) and sets compliance deadlines following the issuance of warnings. 4
In addition, coercive measures (daya paksa polisional) may include: 5 (i) temporary suspension of public services; (ii) seizure of goods or equipment that may cause or contribute to the violation; (iii) product recall from circulation; (iv) prohibition from operating; (v) closure of the relevant premises; (vi) demolition of buildings; (vii) other measures aimed at stopping violations that cause damage; and/or (viii) other measures in accordance with applicable laws and regulations. These coercive measures may be imposed independently or in conjunction with the revocation of PBBR.
Where the relevant licensing was issued by another authorities, OIKN may recommend revocation to the OSS institution (for PBBR) or cooperate with the relevant issuing authority (for non-business licensing and non-licensing approvals).
Public Participation and Complaints
Article 57 of OIKN Reg 1/2026 expressly allows public participation in supervision, including through monitoring and complaint submission. Complaints may be submitted directly to OIKN, in writing, or electronically through OSS or other complaint channels.
Complaints must be accurate, accountable, and to contain minimum information, such as the substance of the complaint, parties involved, and chronology. Complaint handling is followed up by OIKN and/or the OSS institution through verification and clarification procedures.
Force Majeure (OSS System Disruption)
Article 59 of OIKN 1/2026 provides that where OSS cannot function due to force majeure, supervision and licensing-related processes may be conducted manually and remain legally valid. Once force majeure is declared to have ended, business actors and OIKN units must re-record the relevant data into OSS.
Force majeure is defined as an event occurring beyond human control and which cannot be avoided, resulting in activities being unable to be carried out as they should. The regulation further recognises force majeure events include: (i) natural disasters (including earthquakes, volcanic eruptions, typhoons, landslides, droughts, forest/land fires due to natural causes, plant pests and diseases, epidemics, outbreaks, extraordinary events, and outer space-related incidents); (ii) non-natural disasters (including forest/land fires caused by human activity, transportation accidents, construction/technology failures, industrial impacts, nuclear explosions, environmental pollution, and space-related activities); (iii) social disasters (including social unrest and recurring social conflicts); (iv) strikes; (v) fires; (vi) other industrial disruptions declared through a joint decision of the Minister of Finance and/or other relevant technical ministers; and/or (vii) other force majeure circumstances as recognised under applicable laws and regulations.
Disclaimer:
This client update is the property of ARMA Law and intended for providing general information and should not be treated as legal advice, nor shall it be relied upon by any party for any circumstance. ARMA Law has no intention to provide a specific legal advice with regard to this client update.
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