Is Your Online Business Legal?

Is Your Online Business Legal?

Lately opening an online business has become very easy. you can use services like Toko-Toko and Magento which can help you create websites and payment gateways, while marketplaces like Amazon and AliExpress allow you to put your products in front of a global audience.

When you want to start an online store, you will still be wondering whether opening an online store or selling in a marketplace needs to take care of an online business license or not?

In many ways, online business is no different from a “brick and mortar” store, because it requires the same license and government permission. But there are some important differences that digital entrepreneurs must watch out for before launching their business.



License protects your business

License as a means of legal protection for your business. By having permission or legalization, you can prevent unexpected legal sanctions. And with the permission or legality can help you increase income turnover. Therefore it will be very helpful if you know the legal steps that are right before starting a business.


  • The Business Trade License (SUIP): SIUP is a form of trading permit that must be owned by every business actor conducting business trading activities. This is the first step to starting a business. Since 2017 the government has provided facilities where businesses that have SIUP do not need to re-register because the SIUP is valid as long as the trading company runs business activities in the trade sector. And in the process of issuance, business actors who submit SIUP are free of charge.


  • Company Registration Certificate (TDP):  From 2007, the Indonesian regulation stated that any limited liability companies (PT and PT PMA), foreign companies located in Indonesia, and other cooperatives, individual business owners to register the TDP with few special waivers available. At the local Company Registration Office (KPP), you can proceed the registration.


  • Electric System Operator Registration (PSE):  The PSE registration system is the officially established by the Ministry of Communication and Information Technology at Kominfo which is now partnership with the Indonesian E-Commerce Association(IDEA) to protect the e-commerce business on either who are members of the IDEA or even non-registered members.


  • Get special industrial licenses or permits:  Some professions require special business licenses issued by the state. To obtain the license or permit, the applicant generally must show skills or take part in certain training including medical, legal, real estate, or auction treatments. Also, if the business you have involves sending animals or plants across national borders, then you must apply for a special permit.


  • BPOM Permit: Permission from the Food and Drug Supervisory Agency is needed if the trader sells his own processed food.



Write the Terms & Condition:

The most visible difference between online and offline business lies in privacy, security, copyright, and taxation. Regulations related to law such as online advertising copyrights will still apply even if you do not make sales through your own online store. If you use a website for any type of business, then you need to include the terms & conditions about your service. This will protect you from all kinds of complaints and legal sanctions.

Terms and conditions



If you want to start an online business from scratch, like creating your own website, looking for warehouses, buying products, or making products, then you do research on the points above. You can also ask for input from friends, or join several communities that can help you from time to time.

When you choose an e-commerce platform that is suitable for starting an online business, you also have to consider what legalization support they have. If you have questions about how to start an online business that is legalized then don’t hesitate to contact Toko-Toko Customer Service. Anytime, we are here to help you.


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