Open a HORECA Company in Indonesia

Updated on Thursday 13th December 2018

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Tourism is one of the most appreciated industries in Indonesia not only by tourists but also by investors who have found many business opportunities here. Starting a company in tourism is a very good idea considering small companies can operate accommodation facilities, but one can also set up large resorts which offer full services.

The best way of setting up a business in tourism in Indonesia is by opening a HORECA company which offers multiple services, such as accommodation and foods establishments. HORECA is short for hotel, café, restaurant, therefore one or more of these services can be combined in order to run a successful business in Indonesia.

The requirements imposed on foreign investors opening HORECA companies here are quite different from those imposed on local entrepreneurs, and our team of company formation agents in Indonesia can be your guide in starting such business here.

Registering a HORECA business as a foreigner in Indonesia

Foreign investors can open HORECA companies if they have a local partner. The most appreciated type of structure for such operations is the limited liability company which can also be fully owned by a foreign entrepreneur. However, for a hotel license, a local partner is needed.

In order to register a HORECA business in Indonesia as a foreigner, one should consider the following:
  •           an investment plan of at least 10 billion IDR (close to 760,000 USD) is required;
  •           at least 2,5 billion IDR must be deposited as an initial capital of the company;
  •           the company must then be registered with the local office of the Trade Register in Indonesia;
  •           the company must obtain a tax identification number and a VAT number.

Once these steps are completed, the company will be required to start the licensing procedure. Our Indonesia company incorporation specialists can help foreign investors with the registration procedure of a HORECA business.

Licenses for HORECA companies in Indonesia

Once the Indonesian company is registered, the licensing procedure for operating as a restaurant, hotel, or resort must begin with the city hall where the company will operate and with the local office of the tourism and culture agency.

The following licenses are available for those who want to open a HORECA company in Indonesia:
  1.           the restaurant license which will allow the company to serve food;
  2.           the hotel license which can differ based on the types of services offered and the number of rooms;
  3.           the music license is most of the times applied for, as both hotels and restaurants play music on the premises;
  4.           the alcohol beverage license is mandatory for serving alcoholic drinks in Indonesia;
  5.           import licenses for restaurants importing foodstuff from outside the country.

When it comes to the hotel license, it should be noted that different requirements apply based on whether the Indonesian accommodation business is starred or not.

Documents needed to register as a tourism business in Indonesia

Most HORECA companies are registered as tourism businesses in Indonesia. The following documents need to be submitted with the tourism and culture department:
  •           the application form issued by the agency;
  •           the company’s incorporation documents;
  •           the applicant identification papers (ID or passport);
  •           a copy of the tax registration form which must state the company’s tax ID;
  •           a copy of the building permit and rental agreement;
  •           a report on the environmental impact of the company;
  •           a picture of the location of the company;
  •           a disturbance hinder permit issued by the local police department.

Once these documents are submitted, the company will undergo an inspection from the city hall and then will be enlisted as a tourism business with the Ministry of Tourism. The Indonesian HORECA company will also receive a certificate of tourism business.

HORECA companies must also pay attention to the employment regulations applied in the tourism industry. The employees of such establishments must undergo specific hygiene training programs in order to be able to handle and serve food. In the case of starred hotels, these requirements are stricter.

There are many types of HORECA businesses which can be registered in Indonesia, especially in renowned destinations such as Bali which provides for special regulations related to opening guesthouses. These types of businesses are very popular here and are very sought by foreign tourists.

If you plan on opening a HORECA company in Indonesia and need help, please feel free to contact our company registration consultants in Indonesia. We can assist foreign investors in setting up various types of companies in Indonesia by offering personalized services.