Government Regulation No. 3 of 2026, enacted by the Government of Indonesia on 15 January 2026, amends Government Regulation No. 29 of 2021 to strengthen the administration and supervision of trade activities, particularly targeting direct selling businesses and other distribution models. While the regulation was legally effective in January, several of its core enforcement measures and secondary reporting requirements only became operationally mandatory in the first week of March 2026, marking a significant milestone in regulatory compliance.
Key operational changes now in effect include the prohibition of virtual office addresses for direct selling businesses. Companies must maintain a verifiable physical business presence to qualify for licensing under the revised framework. This measure ensures that authorities can inspect and supervise operations effectively, addressing concerns about shell companies and virtual setups used to bypass regulatory oversight.
Additionally, the March operational milestone includes critical reporting obligations under the Online Single Submission (OSS) platform and other administrative channels. Businesses are required to submit verifiable documentation demonstrating their actual operational capacity, physical office presence, and alignment with licensing conditions. Authorities have indicated that failure to comply with these operational requirements may result in administrative sanctions, suspension of licenses, or additional inspections.
The timing of these operational milestones is particularly important for companies in the direct selling sector, as they now face enforceable compliance obligations that go beyond the initial legal enactment. The enforcement highlights Indonesia’s broader policy objective of enhancing transparency, accountability, and regulatory control over trading activities, ensuring that licensing approvals reflect substantive business operations rather than nominal or virtual setups.
Please refer to the following official legal authority: