Obtaining an STPW Before Franchising Your Business in Indonesia

An established business is not automatically ready to sign a franchise agreement. Besides preparing business systems and disclosure documents, owners need to arrange registration in the correct order. In Indonesia’s franchise sector, the Franchise Registration Certificate, or Surat Tanda Pendaftaran Waralaba (STPW), is a key compliance checkpoint: who must hold one, which documents support the application, and when the next stage can proceed.

1. Distinguish the STPW from routine business licences and registrations

The main legislation to consult is Government Regulation No. 35 of 2024 on Franchising, which replaced Government Regulation No. 42 of 2007. Guidance that still treats the 2007 regulation as the principal rule therefore needs to be checked, even if it was published more recently.

The 2024 regulation defines the STPW as a business licence supporting business activities and as proof that an individual or business entity is registered as a franchise operator. Franchisors, sub-franchisors, franchisees and sub-franchisees are all required to hold one.

This means that a Business Identification Number (NIB) does not replace an STPW. Equally, an STPW does not replace the licences required to operate an outlet. A food business, for example, must still meet the requirements applicable to its activities.

If you are preparing to franchise your business, separate the work into three categories:

• Legal status of the business operator: identity documents, the business entity where applicable, the NIB, and the authority of its management to act.
• Licensing of business activities: requirements specific to the activities and operating location.
• Franchise registration: the STPW required for each party’s role.

This distinction helps the team understand that obtaining one document does not necessarily fulfil every obligation.

2. Identify the applicant and check that the documents are consistent

Before starting an application through Indonesia’s Online Single Submission (OSS) system, decide who will act as the franchisor. Do not use a company name in the prospectus, an individual’s name in the draft agreement and a different business account for the application without clarifying the legal relationship between them.

Prepare a checklist covering the applicant’s name, address, NIB, management or authorised representative, and role as franchisor. Cross-check these details against the supporting documents. If the address or management has changed, complete the relevant updates first so that the application does not rely on outdated information.

Under Government Regulation No. 35 of 2024, a franchisor’s STPW application must include the franchise offering prospectus as supporting documentation. This prospectus is not simply a sales brochure. It covers the business’s identity and legal status, operating history, organisational structure, business system, financial statements for the past two years, number of outlets, list of franchisees, and intellectual property certificates or recordal documents.

Registration does not replace compliance with the franchise criteria. Before applying, make sure the business meets the criteria in the 2024 regulation, including a business system, profitability, recorded or registered intellectual property, and ongoing support.

Appoint one person to coordinate the paperwork, monitor requests for corrections and retain the application outcome. A legal review can be helpful where the rights holder, outlet operator and prospective franchisor are different parties.

3. Make the STPW a prerequisite for signing

Government Regulation No. 35 of 2024 requires a franchisor or sub-franchisor to hold an STPW before entering into a franchise agreement. Proof of application is not a substitute for an issued STPW.

Set out a work schedule with a sequence that is easy to verify:

1. Complete the legal documentation, evidence of compliance with the franchise criteria, and prospectus.
2. Apply for the franchisor’s STPW through OSS in accordance with the applicable procedure.
3. Address any deficiencies in the documents and confirm that the STPW has been issued.
4. Ensure the prospective franchisee has received the prospectus at least 14 calendar days before signing.
5. Carry out a final check before the agreement is signed.

This sequence is a conservative administrative approach. The two requirements remain distinct: the franchisor must hold an STPW before entering into the agreement, and the prospectus must be supplied to the prospective franchisee within the required notice period.

Do not promise a signing date based on an estimated issue date. If documents need correcting, the commercial timetable must adjust accordingly. Also avoid treating a document titled “partnership reservation” as a shortcut; its substantive obligations need to be reviewed, not just its title.

4. Complete the franchisee’s registration before the outlet starts operating

The franchisor’s STPW does not automatically cover the franchisee. The franchisee has a separate registration obligation, with the franchise agreement forming the basis of its application. Under Government Regulation No. 35 of 2024, the franchisee must hold an STPW before starting franchise business activities.

After signing, provide the franchisee with the necessary documents and record who is responsible for submitting the application. The franchisor may assist with the administration, but that assistance should not be confused with fulfilment of the franchisee’s obligation.

Use an outlet-opening checklist that tracks the agreement, the franchisee’s STPW, business activity licences and operational readiness separately. Check the OSS guidance and implementing rules in force when applying; do not rely on old screenshots or outdated lists of requirements.

Keep issued documents, proof of delivery and correspondence about corrections in a single, traceable file. If business details change, check whether the system records and related documents need updating.

Practical step: establish two mandatory checkpoints: the franchisor’s STPW before the agreement is signed, followed by the franchisee’s STPW before franchise business activities begin. Build both into the expansion timetable, rather than leaving them on a to-do list for after the outlet opens.