Friday, March 24, 2017
The taxing of multinational corporations is no easy task in this era of globalized capital, especially when national governments have to deal with corporate behemoths such as Google. However, as complicated as this issue can seem at first glance, the collection of such taxes is by no means an impossible task for Indonesia’s tax authorities. Taking its cue from the United Kingdom’s newly enacted diverted-profits tax scheme, the Indonesian government is optimistic that it can find a new solution to the thorny question of collecting taxes from corporations such as Google in ways that don't involve forcing them to register as permanent establishments within Indonesia. Can such schemes ultimately prove effective however? This edition of ILD will address this tangled question, as Indonesia considers incorporating its own diverted-profits tax scheme into its current tax regime.
Friday, March 17, 2017
One of the most controversial draft bills in Indonesian legislative history has been incorporated into the 2017 national prioritized legislation program. Indeed, now that the Draft Bill on Tobacco has come to the attention of the general public after being officially initiated by the House of Representatives in mid-2016, the government just this week indicated its intention to suspend the House’s deliberations of the bill. Some believe that the Draft Bill is urgently needed in order to create a regulatory framework aimed at improving and boosting the national tobacco industry. However, others are of the view that the Draft Bill, in its current version at least, fails to address a number of important elements relating to the public interest, specifically health and poverty. This edition of ILD will analyze the Draft Bill and elaborate upon its key provisions.
Friday, March 10, 2017
As a way of mitigating the problems associated with land scarcity, the government, working in conjunction with the private sector, is currently engaged in a land reclamation project which is aiming to create new land from the sea. However, land reclamation is an issue that remains steeped in controversy and often leads to disputes between those who are initiating a given reclamation project and the residents who are evicted in order to make way for it. This edition of Indonesian Law Digest will present an in-depth analysis of the various issues affecting land reclamation, particularly as they apply in coastal areas and on small islands.
Monday, March 27, 2017
Following the newly enacted Law No. 20 of 2016 on Trademarks and Geographical Indications, the Ministry of Law and Human Rights has expeditiously issued Regulation No. 67 of 2016 on Trademark Registrations in order to create greater certainty regarding the various requirements and procedures involved in the registration of trademarks and collective trademarks, the extension of their protection periods, the amendment to holders’ names and addresses, their transfer, as well as other relevant aspects, including the classification of goods and/or services, the basis for rejection, and official quotations for trademark certificates.
Friday, March 24, 2017
Recognizing the importance of enhancing the financial-soundness of conventional insurance and reinsurance companies in order that they be able to provide adequate protection to their customers, the Financial Services Authority has issued Regulation No. 71/POJK.05/2016 on Financial Soundness for Insurance and Reinsurance Companies. In an attempt to realize this objective, the new regulation outlines a number of financial soundness parameters which should be satisfied by both insurance and reinsurance companies, along with provisions relating to the allocation of guarantee funds, the separation of assets and liabilities of said companies, and the obligation to submit various financial statements to the OJK for compliance-monitoring purposes.
Thursday, March 23, 2017
Through the issuance of Regulation No. 20 of 2017, the Governor of the Jakarta Special Capital City Region has determined the 2017 minimum wages for certain industrial sectors in Jakarta, specifically: (1) Chemicals, energy, and mining; (2) Metal work, electronics and machinery; (3) Pharmaceuticals and health services. In spite of the higher statutory minimum wages set under the new regulation, fewer industrial sectors (from a previous total of 11 down to only three sectors) and subsectors are covered in comparison with the 2016 minimum-wage framework.
Tuesday, February 28, 2017
The ongoing dispute between the government and PT Freeport Indonesia has been very much in the spotlight throughout February 2017. Both parties have yet to reach an agreement regarding the conditions of the Special Mining Business Permit (Izin Usaha Pertambangan Khusus/IUPK) which was granted to Freeport in order to replace its original Contract of Work (Kontrak Karya). Freeport subsequently invoked the arbitration clause in its Contract of Work, meaning that both parties have less than four months in which to settle their dispute amicably before an arbitration forum is set up. The dispute is considered to be one of the greatest challenges currently facing Indonesia and, whatever the outcome, it will surely affect the country’s future investment climate.
Tuesday, January 31, 2017
This edition of Monthly Law Review will outline the key aspects of 114 regulations which were issued in end of December 2016 and January 2017, and we have classified these various regulations into Energy and Natural Resources, Financial Service, Tax, Manufacturing and Industry, Telecommunication and Media, Trade, General Corporate, Litigation, as well as a number of other sectors which we have grouped under the Miscellaneous banner.
Friday, December 30, 2016
Moving on to the legislative sector, the House of Representative has passed 22 new laws this year. Seven of these relate to Indonesia’s ratification of several international treaties or agreements, and three are laws concerning the national budget. As such, the House has in fact only completed 12 new laws of the 51 new laws set by the 2016 Priority Legislative Program. This is a slight improvement by the House compared to last year’s performance, in which the House passed only one of 50 laws set by the 2015 Priority Legislative Program.