Understanding BUJKA License for Foreign Construction Business in Indonesia

Indonesia’s construction industry is one of the fastest-growing in Southeast Asia, driven by massive infrastructure projects, urban development, and private sector demand. This attracts foreign contractors—from design firms to large construction companies—who want to tap into opportunities.

However, many foreign investors face a familiar challenge: the capital requirements for establishing a PT PMA (Foreign-Owned Company) can be prohibitive. As an alternative, Indonesia provides a more practical entry route through the BUJKA license—a special license for foreign construction companies to operate under a representative office model.

This article explains what BUJKA is, its scope, requirements, process, and why it can be an attractive pathway for foreign investors entering Indonesia’s construction sector.

What is BUJKA?

BUJKA (Badan Usaha Jasa Konstruksi Asing) refers to a foreign construction company’s representative office in Indonesia. Instead of setting up a full-fledged PT PMA, foreign contractors can open a BUJKA office to participate in large-scale projects while partnering with local construction companies.

The legal foundation of BUJKA is found in Indonesia’s Construction Services Law and implemented under the risk-based licensing system (OSS-RBA) introduced by Government Regulation No. 28/2025. Under this system, business activities are classified according to risk levels, and construction services—including BUJKA—fall into the medium-high risk category.

This means that establishing a construction company requires more than just a Business Identification Number (NIB); it must also obtain an operational license both for foreign and national companies.

Scope of BUJKA Operations

The BUJKA license is not a free pass to perform any construction work in Indonesia. Its scope is clearly defined:

• Large-Scale, Complex Projects
  BUJKA is allowed only for projects categorized as large and complex—typically involving advanced engineering, high investment value, and national importance.
• Joint Operation with Local Partners
  A BUJKA must always collaborate with a licensed national construction company (BUJKN). This ensures local participation and knowledge transfer.

📌 Example: A European construction firm may open a BUJKA in Jakarta to bid on high-value infrastructure projects, but the execution must be carried out in joint operation with an Indonesian BUJKN partner.

BUJKA Requirements for Foreign Contractors

To secure a BUJKA license, foreign construction companies must meet both technical and financial criteria:

1. Technical Requirements
   • Portfolio of large-scale or complex construction projects overseas.
   • Certificates of expertise, such as SKA (Sertifikat Keahlian) or SKT (Sertifikat Keterampilan) for Indonesian engineers and technical staff.
   • Membership in a recognized professional or industry association.
2. Financial Requirements
   • Proof of handling construction projects with a cumulative value of at least IDR 250billion during the past 10 years; OR
   • Experience in a single project valued at IDR 83.3 billion or more.
3. Administrative Requirements
   • Appointment of a chief/head of representative office in Indonesia..
   • Registered office address in Indonesia.
   • Parent company documents: Legalized Articles of Association, Certificate of Incorporation, and audited financial statements.
   • Registration in the OSS system under the correct KBLI classification (medium-high risk)

The Licensing Process

Applying for a BUJKA license involves several stages. While the process is centralized under OSS-RBA, it still requires thorough preparation:

1. Determine KBLI Code
   Confirm the appropriate KBLI classification for construction services.
2. Document Preparation
   Compile technical, financial, and administrative documents, including proof of experience and certifications.
3. Application via OSS-RBA
   Submit documents through the OSS online system.
4. Verification and Standard Certificate
   Authorities review the application. For medium-high risk categories, a Standard Certificate must be issued before operations can begin.
5. Joint Operation Agreement
   Once licensed, the BUJKA must sign a Joint Operation (JO) agreement with a BUJKN partner for every project.

Estimated timeline: 2–3 months, depending on document readiness and verification process.

Benefits of BUJKA for Foreign Investors

1. Lower Entry Barrier
   Unlike PT PMA, BUJKA does not require a minimum paid-up capital of IDR 10 billion.
2. Access to Strategic Projects
   Enables participation in high-value infrastructure and government projects.
3. Market Testing
   Allows foreign firms to establish a presence and build partnerships before committing to full incorporation.
4. Enhanced Credibility
   A BUJKA license signals compliance with Indonesian law, improving trust with local stakeholders.

Limitations and Challenges

While BUJKA offers advantages, it comes with restrictions:

• Not for Small Projects
  BUJKA is limited to large and complex projects; small-scale works are off-limits.
• Dependency on Local Partners
  Success relies heavily on the capability and reliability of the BUJKN partner.
• Risk-Based Licensing
  As a medium-high risk classification, BUJKA requires strict compliance with technical and financial standards, which can delay licensing.
• Limited Autonomy
  Unlike a PT PMA, BUJKA cannot independently generate revenue outside its authorized scope.

Best Practices & Tips for BUJKA Applicants

1. Select a Reliable BUJKN Partner
   Evaluate potential Indonesian partners for track record, financial stability, and project portfolio.
2. Prepare Documentation Early
   Ensure technical and financial evidence meets Indonesian standards (SKA, SKT, project references).
3. Plan Long-Term Strategy
   Consider BUJKA as an entry phase before forming a PT PMA for a broader business scope.
4. Leverage Professional Support
   Regulatory processes can be complex—work with experienced consultants to avoid delays.

👉 Business Hub Asia provides comprehensive assistance in BUJKA registration, from documentation to compliance, ensuring a smooth entry into Indonesia’s construction market.

The BUJKA license is a strategic pathway for foreign construction firms to enter Indonesia without the heavy capital requirements of a PT PMA. By focusing on large-scale projects, working with BUJKN partners, and complying with medium-high risk KBLI classification, foreign contractors can gain access to Indonesia’s vast construction opportunities.

📞 Partner with Business Hub Asia for expert guidance in BUJKA licensing and market entry strategies. Contact us today for a free consultation.