The sentence that most often causes business owners to panic goes something like this: running a business without environmental approval can lead to imprisonment for 1 to 3 years and fines of up to Rp3 billion. This statement is not incorrect, but it combines two legal pathways that have different requirements and enforcers. Separating them is important because the pathway that most frequently affects business actors is not the criminal pathway.
The criminal pathway has one additional requirement since the Job Creation Law
The threat of imprisonment for a minimum of 1 year, a maximum of 3 years, and fines ranging from Rp1 billion to Rp3 billion indeed comes from Article 109 of Law 32/2009 on Environmental Protection and Management. What has changed is the requirement to reach that point.
Before the Job Creation Law, not having an environmental permit was sufficient for criminal prosecution. After the Job Creation Law amended that article, prosecution can only occur if the business activities result in victims or damage to health, safety, security, and the environment. The Job Creation Law also inserted Article 82A, which states that business actors conducting activities without environmental documents are subject to administrative sanctions.
This means that not having documents is no longer a direct entry point into the criminal realm. There must first be evidence of pollution or victims.
The pathway that truly operates: administrative sanctions
The implementing regulations are new. The Minister of Environment and Forestry/Environmental Control Agency Regulation Number 6 of 2026 on Supervision and Administrative Sanctions in the Environmental Sector has been in effect since June 15, 2026, and revokes Ministerial Regulation 14/2024. If you are still using compliance records that refer to Ministerial Regulation 14/2024, those records are now outdated.
Article 38 outlines five forms of sanctions in a tiered manner:
- written warning
- government coercion
- administrative fine
- suspension of Business Licensing or Government Approval
- revocation of Business Licensing or Government Approval
A written warning must be followed up within a maximum of 30 days from the receipt of the decision. Government coercion can be imposed without prior warning if the violation is repeated or poses a serious threat to health and the environment.
The figure that is often overlooked: fines are calculated based on investment value
Article 43 contains seven criteria for violations that trigger administrative fines. Two of these pertain to environmental approvals, and the calculation method is regulated in Article 45:
| Condition | Fine amount |
|---|---|
| Has Business Licensing, does not have Environmental Approval | 2.5% multiplied by investment value |
| Does not have either Business Licensing or Environmental Approval | 5% multiplied by investment value |
The investment value here is calculated from fixed capital plus working capital, using data from the ministry that manages investments. Article 44 paragraph (2) states a maximum limit of Rp3 billion for each violation, and to date, practitioners still disagree on whether this limit locks the percentage calculation results in Article 45. For businesses with large capital, the difference between these interpretations is not a small amount.
What is also rarely realized: the 5% rate is not only for businesses that are completely unlicensed. Article 45 paragraph (2) interestingly also applies to changes in technical specifications, production equipment, raw materials, land expansion, and the addition of business types that do not comply with the Business Licensing held. For cases of changes, the calculation basis is the investment value of that change, not the entire company.
Three things you can check today
- Match the type of business, land area, and technical specifications currently in operation with those written in the Environmental Approval. Differences here often turn into percentage fines.
- Ensure that submissions and changes to documents are made through Amdalnet, as the entire screening process up to issuance is integrated there.
- Remember that the authority for issuance now follows the location of business activities based on PP 28/2025, so most applications no longer stop at the central level.
The document hierarchy itself, from SPPL to AMDAL, has been discussed separately in this article. If you prefer to see the verbal explanation, there is also a short clip available.
Sources
- Job Creation Law Eases Criminal Sanctions for Environmental Violators, Tirto.id
- Minister of Environment and Forestry/BPLH Regulation Number 6 of 2026 on Supervision and Administrative Sanctions in the Environmental Sector, JDIH Ministry of Environment and Forestry
- Latest Provisions on Administrative Sanctions in the Environmental Sector, Saka Wibisono & Partners
- Revisiting Environmental Approval and Amdalnet Post Issuance of PP 28/2025, Hukumonline
- PP Number 22 of 2021 on the Implementation of Environmental Protection and Management, JDIH Cabinet Secretariat