LKPM is a report on the development of investment realization and issues faced by business actors that is obliged to be prepared and submitted regularly. LKPM is important for the government as it provides insight on investment potential, obstacles and policies that should be implemented by the government. Furthermore, LKPM becomes important for business actors because it is a medium to communicate the issues faced by business actors and to contribute in economic growth.

The legal basis that regulates regarding the LKPM submission are Law of the Republic of Indonesia Number 11 of 2020 on Job Creation and Regulation of the Investment Coordinating Board Number 5 of 2021 on the Guidelines and Procedure for Oversight of Risk-Based Business Licensing.

The LKPM comprises two phases:

1. Construction/Preparation Stage: This phase involves reporting on investment realization, manpower allocation, and challenges encountered by businesses. The LKPM is completed during the initial period of the reporting year after the establishment of a company, before the commencement of business activities.
2. Operational and/or Commercial Stage: In this stage, the report covers investment realization, manpower deployment, production/service delivery, marketing efforts, challenges faced by businesses, and compliance with business obligations. It pertains to businesses that are already engaged in production and/or commercial operations.

The LKPM submission period for small business actors is every 6 months in 1 reporting year, specifically the first semester which should be submitted by the 10^th of July and the second semester which should be submitted by the 10^th of January of the following year.

While the LKPM submission period for medium and large business actors is quarterly, with the following schedule: The report for the first quarter is submitted by April 10^th, the second quarter is submitted by July 10^th, third quarter is submitted by October 10^th, and the fourth quarter report is submitted by January 10^th of the following year

If within the period as specified above and a company has not submitted LKPM, then according to the provisions of Article 55 of BKPM Regulation Number 5 of 2021, the company may be subject to sanctions in the form of a written warning.

If you, a prospective client, have further inquiries about the topic discussed above, Schinder Law Firm is one of many corporate law firms in Indonesia that has handled numerous similar matters, with many experienced and professional corporate and civil lawyers in its arsenal, making it one of the top consulting firms in Indonesia. Feel free to contact us at info@schinderlawfirm.com for further consultation.

Author: 
Dewi Susanti