【SMM Analysis】PP 28/2025 Update: Implications for Indonesian Nickel Smelters

Introduction

Following the previous explanation of Government's Regulation No. 28 of 2025 (PP 28/2025), which governs "Implementation of Risk-Based Business Licensing" on June 5th 2025. SMM has joined FINI (Indonesia's Nickel Industry Forum) Coffee Morning, featuring the Director General of ILMATE (Metal, Machinery, Transportation Equipment, and Electronics Industries), Dr. Setia Diarta, M.T., and attended by stakeholders from various smelters across Indonesia.

Previous News Link:【SMM Analysis】Another Restrictions on Nickel Supply? Indonesian Nickel Market Uncertainty Continues | SMM

I. Why This News Recently Gained Attention?

Although the PP 28/2025 regulation was released in June 2025, there was a four-month grace period in the government’s system. As a result, during October–November, Indonesian smelters began to receive notifications from the OSS (Online Single Submission) system — the platform used for submitting Industrial Business License (IUI) applications. The notice requires companies to submit a written statement explaining that they will not produce MHP, FeNi, NPI, or nickel matte.

However, the OSS application system is not yet running smoothly, with frequent instability and system crashes affecting the submission process.

II. Discussion Points (Presented by Mr. Eko Widodo, Head of the Business Licensing Verification Team at the Directorate of Metal Industry/ILMATE)

• For smelters already under construction, FINI (Indonesia Nickel Smelter Association) will assist in submitting applications to the government to request exemptions from the new regulation, as these projects commenced prior to its enactment. When submitting supporting documents via the OSS system, companies should also include a statement confirming that construction began before October 2025, specifying the exact start date.

• For smelters that are still in the land acquisition phase or have not yet begun construction, obtaining exemptions will be more challenging.

• For companies planning to develop further downstream facilities, such as nickel sulfate or battery materials plants, while still building and operating NPI, FeNi, nickel matte, or MHP smelters under separate entities, these will continue to be treated as two independent company structures. As such, further discussions with the government will be required for this special case.

III. Conclusion and Further Updates

From this discussion, it is likely that smelters currently under construction will receive consideration, as their construction began prior to the issuance of PP 28/2025. For further clarification, FINI will be invited to another coordination meeting with the Coordinating Ministry for Economic Affairs, expected to take place next week. SMM will continue to report on the developments and provide clarity regarding this regulation.