In this article, we will guide you through the process of cosmetic product registration in Indonesia and bring out the most important things you need to bear in mind regarding Indonesian cosmetic regulations.
Which cosmetic products need to be registered in Indonesia?
Every cosmetic product, including personal care and toiletries, imported to and sold in Indonesia must be registered first. Cosmetic product registration is regulated by the National Agency of Food and Drug Control, also known as Badan Pengawas Obat dan Makanan (BPOM).
As opposed to food and beverage registration, for example, where you can register products with differences in packaging, design, manufacturer, etc. in one registration, BPOM requires you to register every variation of a cosmetic product as a separate item.
Therefore, if you wish to import a lipstick brand that comes in pink, red, and brown shades, you would need to register each of them as a separate item.
Naturally, this means hundreds of separate registrations and a lot of paperwork for bigger cosmetics brands.
Who can register cosmetic products in Indonesia?
As regulated by the BPOM, only legal entities established under the Indonesian Law can register cosmetic products in Indonesia. They also need an import license in order to be able to bring the products through Indonesian customs.
Therefore, unless you already have a limited liability company in Indonesia, you must first choose a suitable market entry strategy.
There are three options for registering cosmetic products in Indonesia:
#1 Set up a foreign-owned company in Indonesia
As Indonesian-based cosmetic manufacturers with a valid license can register cosmetic products in Indonesia, the first option is to set up a foreign-owned company (PT PMA) in Indonesia and acquire relevant licenses.
For registering a PT PMA in Indonesia, you must first submit an investment plan of IDR 10 billion (~US$ 750,000). 2.5 billion of it, however, needs to be paid up.
The maximum allowed foreign ownership depends on your business classification. For example, foreign investors can set up 100% foreign-owned import-export companies in Indonesia.
For distribution, however, you will need a local partner. If you don’t have such partner yet, Straits Partners can help you out.
Find more information in our guide to setting up a foreign-owned company in Indonesia.
#2 Set up a nominee company in Indonesia
The second option is to register a nominee company with a letter of appointment from the Principal. What differs nominee companies from PT PMAs is that they are established under requirements set for local companies.
Consequently, you can set up a nominee company with as little as IDR 51 million (~US$ 3,800). Most importantly, you would still have total control over your company and its assets.
As you purchase shares through a loan agreement between the nominee and you, they are pledged back to you for full control.
Read more about using nominee shareholders in Indonesia the safe way.
#3 Straits Partners as your nominee product holder
However, if your business is not in Indonesia and do not wish to set up a legal entity here either, you can also register your products through Straits Partners. We will provide you with our licenses and act as your nominee product holder.
For more information, contact us via [email protected]
How to register cosmetic products in Indonesia
Before you can start registering your products, you have to apply for an access to BPOM’s online system. For that, you need to submit an online application together with the necessary supporting documents, including:
Documents of incorporation
Import License (API-U)
Copy of the cosmetic manufacturer’s Good Manufacturing Process certificate, legalized by the Indonesian Embassy of the manufacturer’s state.
Certificate of Free Sales, issued by the governing body of the Principal’s location, legalized by the Indonesian Embassy.
Letter of Authorization from the Principal to the applicant
Once you have gained access to BPOM, you can start registering your cosmetic products in Indonesia.
#1 Submission of products
For each product you want to import, you need to request a separate notification as every stock keeping unit is an individual product in Indonesia. In other words, each product with variations in color, size, etc. needs to get its own notification.
Fortunately, this is all done online, by uploading the information of the cosmetic products, such as name, ingredients, functions of the ingredients, packaging, etc.
#2 State payment for each of the product
The second step of cosmetic product registration in Indonesia is paying a fee for each product:
IDR 1,500,000 per product when produced outside of ASEAN
IDR 500,000 per product when made in ASEAN countries
Also, note that this fee is not refundable, should the BPOM reject your product registration.
#3 BPOM notification/ Notifikasi kosmetik
If your products meet the requirements and your registration succeeds, you will receive a notification from the BPOM. BPOM will issue the notification number within 14 working days after the validation of the payment.
However, note that once you receive the notification, you must import each of the units within 6 months to keep your product registration valid. Also, you have to comply with further requirements such as preparing your product information database and labelling your products correctly before selling them in Indonesia.
The BPOM notification will be valid for three years and is extendable after that.
Common problems with cosmetic product registration in Indonesia
The process of cosmetic product registration in Indonesia is quite straightforward, as long as your documentation is in order, the application is correct and your products meet the safety and quality requirements.
However, there are still various reasons why the BPOM delays or even refuses your product registration. Here are some examples of our clients.
Producer is not able to provide a GMP certification
The BPOM only accepts GMP (Good Manufacturing Practice) certifications which are issued by governmental institutions. Certifications issued by private sector entities will not be accepted unless the country where the manufacturer is located allows it. In that case, however, further documents need to be provided.
Therefore, make sure that everything is in order with your documentation before proceeding with registering your cosmetic products in Indonesia.
Product name is misleading and/or overclaiming
BPOM also determines whether the products’ names will be misleading for Indonesian consumers. For example, you cannot name a cosmetic brand “Rose” if the product itself doesn’t have rose as an ingredient.
Another example is a product with the name “Magic White”. In this case, the BPOM considers the product as overpromising and creating false claims, due to the word “magic”.
Formula is forbidden
There are regulations regulating ingredients that are allowed to use, have limitations, or are prohibited in Indonesia.
For example, a company tried to register a skin foundation of color index No. 10006 (pigment green 8). BPOM refused to register it because color index No. 10006 is for short-term use while skin foundation for a longer period of time.
A lipstick of the same color index, however, was accepted since the BPOM sees it as a product that is used for a shorter period.
Another example is using Phenoxyethanol as a preservative. The maximum allowed percentage in cosmetic products in Indonesia is 1%. If you are submitting a formula that contains 1.02%, the BPOM will reject the application.
Compliance after cosmetic product registration in Indonesia
Product registration number (DIP)
For every unit you are importing to Indonesia, you need to have a product registration document (DIP). BPOM is frequently auditing the importers to make sure they have their DIP in order.
DIP can either be in English or Indonesian and has to include the following information:
Administration documents and summary of the products
Quality data of cosmetics
Safety and usage data of cosmetics
Labelling requirements of cosmetic products in Indonesia
When you sell your cosmetic products in Indonesia, the labels of the products need to be in Indonesian and must at least include the following information:
Name of the product
Name of the manufacturer
Name and address of the importer
Any warnings regarding the ingredients
For example, on the label of a hair color, there should be warnings that it can cause an allergic reaction or that it is not for use for children under 16 years old.
Starting with cosmetic product registration in Indonesia
As you can see, preparation is the key to a successful BPOM registration. If you are not sure whether your products comply with Indonesian regulations or need assistance with registering your cosmetic products in Indonesia, contact us via the form below. Our team will gladly help you out.
Feel free to reach out to us at [email protected]