Regulatory Updates

Financial Services Authority Regulation No. 3/POJK.04/2021 on Organization of Activities in the Sector of Capital Market (“POJK 3/POJK.04/2021”)regulates technical matters and applicable sanctions in the acquisition of legality and/or organization of capital market activities.
• The key points being regulated under POJK 3/POJK.04/2021 are:
1. Acquisition of Legality for Stock Exchange;
2. Acquisition of Legality for Clearing and Guarantee Institution as well as Storage and Settlement Institution;
3. Acquisition of Legality for Mutual Funds;
4. Acquisition of Legality for Securities Company;
5. Requirements for Representative of Securities Company;
6. Requirements for Investment Advisory and Acquisition of Legality in Securities Company Rating;
7. Acquisition of Legality for Commercial Bank as Custodian;
8. Acquisition of Legality for Securities Administration Bureau;
9. Acquisition of Legality for Trustee;
10. Eligible Professions in Supporting Stock Exchange; and
11. Financial Services Authority’s Eligibility to Convert Public Listed Company to Non-Public Listed Company.
• POJK 3/POJK.04/2021 provides technical guidance/threshold in relation to requirement, obtaining permits and eligibility of capital market activities to be carried out by investors/related business actors as well as the sanctions for violations of each of its provisions and the respective transitional provision.
Government Regulation No. 18/2021 on Right to Manage, Land Titles, Flat Units, and Land Registration (“GR 18/2021”)• GR 18/2021 regulates various land titles recognized in Indonesia with regards to each of their validity period, subject as well as obligation, prohibition and right of holder of each land title.
• The key points being regulated under GR 18/2021 are:
1. Right to Manage;
2. Right to Cultivate;
3. Right to Build;
4. Right to Use;
5. Right to Own over Flat Units;
6. Residential House or Residential for Foreigners;
7. Land Title or Right to Manage in the Upper Ground and Underground Space; and
8. Land Registration.
• GR 18/2021 provides a comprehensive regulation on each land title as well as technical aspects on land registration procedure.
Presidential Regulation Number 38 of 2015 regarding Government Cooperation with Business Entities in Infrastructure Provision ("PR 38/2015")• PR 38/2015 is a regulation that regulates regarding Government Cooperation with Business Entities (which is known as KPBU) in regard to infrastructure provision.
• The type of infrastructure that can be cooperated (KPBU) on based on this regulation are economic infrastructure and social infrastructure, which are:
o Transportation infrastructure.
o Road infrastructure.
o Water resources and Irrigation infrastructure.
o Drinking water infrastructure.
o Centralized wastewater management system infrastructure.
o Local wastewater management system infrastructure.
o Waste management system infrastructure.
o Telecommunications and informatics infrastructure.
o Electricity infrastructure.
o Oil and gas infrastructure and renewable energy.
o Energy conservation infrastructure.
o Urban facilities infrastructure.
o Educational facilities infrastructure.
o Sports and arts facilities infrastructure.
o Regional infrastructure.
o Tourism infrastructure.
o Health infrastructure.
o Prison infrastructure.
o Public housing infrastructure.
• KPBU can be a mix of two or more infrastructure that were mentioned above, and to improve the feasibility of a KPBU and/or provide greater benefits to the community, a KPBU may involve commercial facilities.
• In the implementation of KPBU, the Minister/Head of Institution/Head of Region acts as PJPK. State-Owned Enterprises and/or Region-Owned Enterprises can act as PJPKs, as long as it is as per the regulation.
• In this regulation it is also regulated in regards to land acquisition, Government Support and Guarantee, and Particular KPBU financing by the Government.
Presidential Regulation No. 9/2021 on Housing Administration Acceleration Body (“PR 9/2021”)• PR 9/2021 establishes Housing Administration Acceleration Agency (“BP3”) and regulates the main duties and functions of BP3 in serving the acceleration of construction and provision of public housing for low income society.

• Specifically, its main duties are as follows:

1. Carry out the management of conversion fund;

2. Coordinate the process of licensing and assurance of occupancy

3. Implement the provisions of land for housing

4. Carry out the management of public and special house, including facilitating the residential

5. Carry out the transfer of ownership of public house
Presidential Regulation No. 10/2021 on Business Sectors for Capital Investment (“PR 10/2021”)• PR 10/2021 regulates the type of open business fields including its criteria and requirements to be categorized by each following business fields.

• The category of business fields consists of:

a. Priority Business Fields;
b. Allocated business areas or partnership with cooperatives and MSMEs;
c. Business Field with Certain Requirements; and
d. other Business Fields besides point a-c which is open for all investors.

• The list of Business Fields according to the category aforementioned is provided in the Annex attached.
Download I
Download II
Download III
Presidential Regulation No. 11/2021 on Cooperation between Central Government and State-Owned Enterprises on Administration of Basic Geospatial Information (“PR 11/2021”)• PR 11/2021 is aimed to provide funding for administration of basic geospatial information, access to such information, and creating investment climate in geospatial information sector to stimulate geospatial industry growth.

• PR 11/2021 regulates:

1. The activities regarding the implementation of Basic Geospatial Information (“IGD”) that can be done in the form of the implementation of geodesy network control and basic map.

2. The election of Implementing State-Owned Enterprises (“BUMN”) regarding the Cooperation between Central Government with BUMN (“KPBUMN”) which consists of various activities, i.e.,:

a. the planning and preparation of KPBUMN;
b. criteria and election of KPBUMN; and
c. the signing of KPBUMN Agreement;

3. Financial aspects in KPBUMN, which is Government Supports in fiscal and non-fiscal form, financing, and Return on Investment
Presidential Regulation No. 12/2021 on Amending Presidential Regulation No. 16/2018 on Procurement of Government Goods/Services (“PR 12/2021”)• PR 12/2021 amends/repeals articles concerning:

1. Elimination and all regulations concerning Inspection Officer for Goods Provision Works Result/Inspection Committee Service for Goods Provision Works, and Middle-Sized Enterprises;

2. Addition and Amendment of tasks and authorities of actors in provision of goods and services;

3. Amendment and addition of regulations concerning Self-Predicted Price (“HPS”) value, contract, guarantee of implementation, methods of selection, pre-qualification, small-sized enterprises, etc.
Government Regulation No. 5/2021 on Risk-Based Business Licensing (“GR 5/2021”)• GR 5/2021 aims to implement Risk-Based Business Licensing through simplified licensing mechanism and supervision of business activities.
• Business risk for the purpose of licensing is graded according to risk analysis, which defines what kind of Business License a business shall obtain.
• Points for risk analysis done by the central government, namely:
1. Identification of business activity;
2. Assessment on the level of dangerousness;
3. Assessment on possibilities for danger;
4. Identification of risk level and business scale level; and
5. Identification of Business License types.
• Duties of governor/regent/mayor to provide Business Licensing service in accordance with applicable legislations concerning administration of Risk-Based Business Licensing
• Implementing Stages on conducting business activity consist of:
1. Preparatory; and
2. Operational and/or commercial stages
Government Regulation No. 6/2021 on Regional Business Licensing Administration (“GR 6/2021”)• GR 6/2021 regulates regional government’s role in administering Business Licenses along with the central government.
• Governors and mayors/regents delegate regional government’s authority in Business Licensing through their respective regional head of (provincial/municipal) Single-Window Integrated Service.
• Regional government’s administration of business licensing shall refer to regulation on risk-based business licensing.
• Further, GR 6/2021 regulates Administration of Regional Business Licensing which covers:
1. Authorities of Administration of Regional Business Licensing;
2. Implementation of Regional Business Licensing;
3. Regional Regulation and Head of Regional Government Regulation on Business Licensing;
4. Reporting of Regional Business Licensing;
5. Development and supervision;
6. Funding; and
7. Administrative sanctions.
Government Regulation No. 7/2021 on Relaxation, Protection, and Empowerment of Cooperatives and Micro, Small and Medium-Sized Enterprises (“GR 7/2021”)• GR 7/2021 regulates:
1. Facilitation, Protection and Empowerment of Cooperatives, which covers:
a. Facilitation in Operating Cooperatives
b. Cooperatives Business
c. Protection of Cooperatives
d. Policy regarding Cooperative Development in Certain Sectors.
2. Facilitation, Protection, and Empowerment of Small-Sized Enterprises, which covers:
a. Facilitation in Operating Micro and Small-Sized Enterprises (“MSE”) including the criteria for MSMEs, Risk-Based Business Licensing, Single Licensing and Facilitation for Standard Certificate and/or Permit
b. Protection of MSEs in the Provision of Legal Assistance Service for MSEs and Revitalization of MSEs
c. Empowerment of MSMEs
d. Business Development
e. Coordination and Controlling of Facilitation, Protection, and Empowerment of MSMEs.
3. Partnership, which covers:
a. Incentives for Partnership
b. Partnership Patterns
c. Partnership Agreement
d. Role of Central and Regional Governments in Partnership
e. Partnership Supervision, Procedures for Imposing Administrative Sanctions.
Government Regulation No. 8/2021 on Authorized Capital of Companies and Registration of Establishing, Amending, and Dissolving Companies Fulfilling Requirements for Micro and Small-Sized Enterprises (“GR 8/2021”)• GR 8/2021 regulates:
1. The Criteria of limited liability for micro and small-sized enterprises, which consists of:
a. A company established by 2 (two) or more persons; and
b. Single-member limited liability company established by 1 (one) person. The amount of authorized capital is set by the company’s decision.
2. The establishment of Single-member limited liability company and its provisions, such as requirements for establishment, amendment on single-member limited liability company establishment, financial report, and its dissolution.
Act No. 11 of 2020 on Job Creation (“Act 11/2020”)• Act No. 11/2020 serves the main purpose of job creation, as well as easing investments and business conducts in Indonesia
• Divided into several chapters and sectors, which amend multiple acts in one regulation.
• Act No. 11/2020 also establishes INA.
• In force.
Government Regulation No. 01 of 2021 on Assessment Method for Non-Tax-Derived Government Incomes (“GR 01/2021”)• GR 01/2021 is issued as the implementing regulation of Act No 9 of 2018 on Non-Tax-Derived Government Incomes (“Act 09/2018”).
• This Government Regulation deals with issues pertaining to explanation of methods in assessing Non-Tax-Derived Government Incomes (“PNBP”).
• In force.
Minister of Finance Regulation No. 04/PMK.03/2021 of 2021 on Payment of Stamp Duty, General and Specific Characteristics of Adhesive Stamp Duty, Stamp Duty in Other Forms, and Determination of Validity of Stamp Duty, and Post-Dated Stamp Duty (“MoFR 04/PMK.03/2021”)• MoFR 04/PMK.03/2021 regulates that stamp duty is set at a fixed rate of IDR 10,000.00 (ten thousand rupiah).
• Stamps made pursuant to Minister of Finance Regulation No. 65/PMK.03/2014 are still valid until 31 December 2021, where such stamps (of adhesive nature) are attached to documents valued at least IDR 9,000.00 (nine thousand rupiah).
• In force.
Minister of Finance Regulation No. 06/PMK.03/2021 of 2021 on the Calculation and Collection of Value-Added Tax and Income Tax on Submission/Income for Sales on Mobile Phone Balance, SIM Card, Token and Voucher (“MoFR 06/PMK.03/2021”)• MoFR 06/PMK.03/2021 is issued as an implementation regulation of several Acts (namely, Act No. 8/1983 on Income Tax (as amended by Act No. 36/2008), Act No. 8/1983 on Value-Added Tax for Goods and Services and Luxury Goods Sales Tax (as amended by Act No. 42/2009), Act No. 39/2008 on State Ministries, and Act No. 11/2020 on Job Creation), as well as two regulations (Presidential Regulation No. 57/2020 on Ministry of Finance, and Minister of Finance Regulation No. 217/PMK.01/2018 on Organization and Working Outline of the Ministry of Finance (as amended by Minister of Finance Regulation No. 229/PMK.01/2019).
• Mobile phone balances and SIM cards, as well as electricity tokens, are subjected to value-added tax under this regulation.
• Additionally, rewards such as voucher, points, or cash money are subjected to income tax, which also apply to sales of mobile phone balances and SIM cards.
• In force.
Minister of Finance Regulation No. 09/PMK.03/2021 of 2021 on Tax Incentive for Taxpayers Affected by Coronavirus Disease 2019 (“MoFR 09/PMK.03/2021”)• MoFR 09/PMK.03/2021 regulates that taxpayers are subjected to a final income tax of 0.5% from gross total circulation, and is borne by the government.
• Incentives are given for the duration of January 2021 until June 2021, which also includes exemption from income tax for imported goods.
• In force.
Decision of the Minister of Energy and Mineral Resources No. 22.K/MG.03/MEM.M/2021 on Indonesian Crude Oil Price Promulgation for January 2021 (“MoED 22.K/MG.03/MEM.M/2021”)• MoED 22.K/MG.03/MEM.M/2021 serves to set prices for Indonesian primary and secondary crude oil produces.
• The rate of Indonesian crude oil price under this regulation is set at US$ 53.17/barrel
• In force.
Minister of Agrarian and Spatial Affairs/Head of the National Land Agency Regulation No. 1/2021 of 2021 on Electronic Land Certificate ("MoASA/HNLAR 01/2021")• MoASA/HNLAR 01/2021 regulates the issuance of electronic land certificate for both first-time spatial/land registration and transition from original (printed) land certificate.
• In force
Minister of Finance Regulation No. 3/PMK.08/2021 of 2021 on Amending Minister of Finance Regulation No. 149/PMK.08/2018 on Buyback of Government Bonds (“MoFR 03/PMK.08/2021”)• MoFR 03/PMK.08/2021 allows for buyback of government bonds through debt switching in creating ‘new issuance’ series of government bonds and/or ‘reopening’ of bonds as replacement government bond series.
• The Bank of Indonesia (“BI”) is now included as parties to which the government can exercise buyback of government bonds. BI’s sale of government bonds can only be offered directly to the government without going through the Main Dealer.
• New addition Article 21A regarding adjusting/setting of price for buyback of government bonds; to be regulated through a Decision of the Directorate-General of Funding and Risk Management.
• In force.
Minister of Communications and Information Regulation No. 1/2021 of 2021 on Second Amendment of Minister of Communications and Information No. 13/2019 on Provision of Telecommunication Services ("MCITR 01/2021")• MCITR 01/2021 now regulate types of telecommunication services that might exist in the future (including Other Value-Added Telephony Services and Other Multimedia Services).
• Other forms of telecommunications services can be regulated in the future, depending on technological advances and healthiness of telecommunications industry.
• Telecommunication services provider (TSP) shall begin commercial operation 120 days after obtaining Business License (as opposed to Minister of Communications and Information Regulation No 13/2019, where such operation shall commence after the license is effectively applicable).
• TSPs have to comply with Business License requirements according to Indonesian regulations (as opposed to complying with Provider License requirements provided by the Minister of Communications and Information in the previous regulation).
• In force.
Presidential Regulation No. 2/2021 of 2021 on Ratification of the Convention Abolishing the Requirement of Legalisation for Foreign Public Documents (“PR 2/2021”)• PR 2/2021 ratifies the Convention Abolishing the Requirement of Legalisation for Foreign Public Documents (“the Convention”)
• PR 2/2021 include two annexes covering Indonesian translation of the Convention and the combined French-English version of the Convention.
• PR 2/2021 binds Indonesia as a party to the Convention, where Indonesia shall exempt certain other party’s public documents from legalisation in Indonesia.
• Documents of other State parties to the Convention that shall be exempted from legalisation in Indonesia include
a. documents emanating from a State’s court/tribunal (including from public prosecutor, clerk, process-server/huissier de justice);
b. administrative documents;
c. notarial acts; and
d. official certificates on documents signed by persons in private capacity.
• In force.
Download 1
Download 2
Minister of Manpower Regulation No. 2/2021 on Implementing Salary Payment for Certain Labour-Intensive Industries during Corona Virus Disease 2019 (COVID-19) Pandemic (“MOMR 2/2021”)• MOMR 2/2021 regulates salary payment mechanism for certain labour-intensive industries during COVID-19 pandemic.
• Article 2 (1): The criteria for ‘certain labour-intensive industries’ are as follows
a. Possess at least 200 workers.
b. Percentage of employee fee within production fee is at least 15%.
• ‘Labour-intensive industries’ as mentioned in Article 2 (1) are further specified to include
a. Food, beverage and tobacco industry;
b. Textile and clothing industry;
c, Leather and leather goods industry;
d. Footwear industry;
e. Children toy industry; and
f. Furniture industry.
• Industries covered by the regulation may adjust the amount and method of salary payment for employees, based on an agreement between the Entrepreneur and the employees
• Article 7 (2): the agreement must contain at least:
a. Amount of salary;
b. Method of salary payment; and
c. Duration of applicability, lasting until at the latest on 31 December 2021
• In force until 31 December 2021
Government Regulation No. 74 of 2020 on Indonesian Investment Authority (“GR 74/2020”)• GR 74/2020 is issued as the implementing regulation of Act No. 11/2020 on Job Creation.
• GR 74/2020 establishes INA and outlines its functions, authorities, and organization.
Government Regulation No. 73 of 2020 on Starting Capital of the Indonesian Investment Authority (“GR 73/2020”)• GR 73/2020 is issued as the implementing regulation of Act No. 11/2020 on Job Creation.
• GR 73/2020 outlines INA's starting capital to be at IDR 15,000,000.00 (fifteen trillion, Indonesian rupiah).
Government Regulation No. 49/2021 on Tax Treatment for Transactions Involving Indonesian Investment Authority and/or Its Entities (“GR 49/2021”)• GR 49/2021 regulates the treatment of Income Tax and Value Added Tax and/or Value Added Tax and Luxury Goods Tax treatment towards LPI and / or the entities it owns, including third parties involved in transactions with INA and/or its entities.
• GR 49/2021 regulates that Indonesian Investment Authority (“INA”) is a domestic corporate tax subject while its entities may be either domestic or foreign tax subjects.
• INA and its entities shall register as taxable subjects.
Government Regulation No. 48/2021 on Third Amendment to Government Regulation No. 31/2013 on Implementing Regulation of Act No.6/2011 on Immigrations (“GR 48/2021”)• GR 48/2021 amends multiple provisions to facilitate investor with ease of immigration, including by allowing investor to apply multiple visit visa for pre-investment purpose and allows immigration guarantee deposit as a substitute to letter of guarantee
• The maximum duration for single and multiple visit permit is increased to 180 days.
• Single visit permit cannot be extended while multiple visit can be extended as long as the stay does not exceed 12 months
Government Regulation No. 47/2021 on Administration of Hospitals (“GR 47/2021”)• GR 47/2021 regulates:

1. Hospital classification including:

a. General
b. Service Ability
c. Health Facilities and Supporting Facilities
d. Human Resources
e. Class Change

2. Hospital obligations

3. Hospital accreditation

4. Administrative sanction imposition procedures.
Government Regulation No. 46/2021 on Post, Telecommunications, and Broadcasting (“GR 46/2021”)• GR 46/2021 regulates:

1. Administration of Post;

2. Administration of Telecommunications;

3. Utilization of Radio Frequency Spectrum; and

4. Administration of Broadcasting.

• Further, GR 46/2021 provides foreign postal administration to conduct postal activities in Indonesia under the following conditions:

1. Mandatory cooperation with domestic postal administrator through joint venture; and

2. Cooperation between foreign and domestic postal administrators are limited to operation within provincial capitals.

• Foreign postal administrators cooperating with domestic postal administrator through joint venture cannot conduct intercity deliveries.

• In regulating digital television, government to assist in providing set top boxes for low-income households to receive terrestrial digital television services
Government Regulation No. 45/2021 on Administration of Geospatial Information (“GR 45/2021”)• GR 45/2021 covers the following scope of regulations:

1. Types of geospatial information;

2. Administrator of geospatial information;

3. Administration of geospatial information;

4. Implementing entities on geospatial information sector;

5. Administration and updating of Basic Geospatial Information;

6. Nurturing of geospatial information; and

7. Administrative sanctions relating to geospatial information.
Government Regulation No. 44/2021 on Implementation of Ban on Monopoly and Unhealthy Business Competition (“GR 44/2021”)• GR 44/2021 regulates:

a. Authorities of Supervisory Commission on Business Competition (“Commission”);
b. Sanctions, including their criteria, types, and amounts; and
c. Investigation of objection and cassation against the Commission’s decision.

• In imposing sanctions, they are administrative in nature and:

a. Are equivalent to the level or effect from violations done by the related business;
b. Takes the business’ activity continuity into account;
c. Are based with clear grounds and reasoning.
Government Regulation No. 43/2021 on Mitigation of Incompatibility on Spatial Development, Forestry Zone, Permit, and/or Land Rights (“GR 43/2021”)• GR 43/2021 regulates mitigation of incompatibility issues relating to Spatial Planning, Forestry Zone, Permit, Concession, Land, and/or Managing Right, occurring in relation with or within:

a. Regional Limit;
b. Forestry Zone;
c. Zonal Spatial Development Plan (“RTRW”);
d. Permit;
e. Concession;
f. Land and/or Management Right;
g. Shoreline;
h. Marine Spatial Development Plan (“RTRL”), Zonation Plan for Certain National Strategic Zone (“RZ KSNT”), Zonation Plan for Inter-regional Zone (“RZ KAW”), and/or Zonation Plan for Shore Areas and Islets (“RZWP-3-K”); and/or
i. Permit relating to Activities utilizing Marine Space.