Indonesian Law Digest

A short while ago, the Panama Papers scandal was hitting headlines the world over. Millions of files being held by the offshore law firm Mossack Fonseca were leaked, including a wealth of information relating to how SPVs (Special Purpose Vehicles) have been misused for illegal purposes such as money laundering and tax evasion. Moreover, the huge mine of data listed in the leaked files contained the names of over 800 Indonesian parties. This week’s ILD will discuss the issue of SPVs from a global perspective and examine how these vehicles are currently regulated in Indonesia.
Bill on Trademarks and Geographical Indications
In order to replace the nearly two-decade old Law No. 15 of 2001 on Trademarks (“Trademark Law”), the House finally passed the Bill on Trademarks and Geographical Indications (“Bill”) on 27 October 2016. In essence, the Bill aims to ensure healthy business competition, to protect consumers as well as medium-, small-, and micro-scale enterprises, and also to facilitate improvement within the industrial, trading and investment sectors through the revision of various obsolete provisions which were originally set out under the old Trademark Law. This week’s ILD offers analysis of the general framework of the Bill, as well as registration and cancellation procedures for both trademarks and geographical indications. We will also be taking a look at procedures for the transfer of trademark rights. This revision has been deemed necessary in the context of the recent inauguration of the ASEAN Economic Community, which is pushing for greater market liberalization and integration across the region.
Visitor Visas and Limited-Stay Visas for Foreign Citizens in Indonesia
In this era of globalization, immigration represents a huge opportunity but also a multi-dimensional threat to Indonesia. In order to ensure that foreign citizens can enjoy legal certainty whenever they visit Indonesia, the country’s government has issued a number of regulations which relate to immigration issues. Most recently, the Ministry of Law and Human Rights issued Regulation No. 24 of 2016 on Technical Procedures for the Requesting and Issuance of Visitor Visas and Limited-Stay Visas. This edition of ILD will be focusing on things that all foreign citizens should know as regards the securing of these two kinds of visa.
Indonesian Import Rules: Importer-Identification Numbers
Indonesia is currently ranked in seventh place on the list of the world's largest importers. Indeed, a number of business sectors in the country remain highly dependent on the import of commodities. Given the importance of import activity for the national economy then, understanding the regulatory framework that governs imports is essential. Two main areas are addressed under the current regulatory framework for imports, namely: customs provisions and import licensing. This edition of Indonesian Law Digest (ILD) will discuss the procedure whereby a business secures an Importer-Identification Number (API), which is a primary requirement for all importers, regardless of their relevant business areas. The API serves as a license which can be used by businesses to import goods into Indonesian territory, as set out under Law No. 7 of 2014 on Trade.
The Legal Profession in Indonesia
As the world’s fourth most-populous nation, Indonesia is arguably one of the world’s most promising countries as regards investment, and strong economic growth coupled with favorable demographics make it a great destination for investors. However, Indonesia is also notorious for its legal complexities, and the high profile of the country’s legal profession is the result of this. Indeed, a number of activities which relate to investment may only be undertaken by through the legal profession. This week’s edition of ILD offers a general exposition of several areas of the Indonesian legal profession, including advocates, notaries, land-deed officials, arbitrators, mediators, receivers and administrators.
Draft Bill on Food and Drugs: Towards Better Supervision
In the wake of the significant turbulence caused by various recent food and drug scandals, the government has finally decided to take serious action and is currently in the process of preparing a comprehensive framework relating to the supervision of food and drugs in Indonesia. The House of Representatives is at present discussing the Draft Bill on the Supervision of Food and Drugs with the relevant stakeholders, specifically the BPOM (the National Agency for Drug and Food Control).
Ministry of State Secretariat Regulation on Archive Security Classification: New Freedom of Information Challenges
On 28 September, the world celebrated International Right to Know Day, which is held in order to commemorate the right of civil society, journalists and citizens to access information which is held by public institutions. This day offers an opportunity for the world to reflect on the progress that has been made regarding the right to information, which is now protected as a human right under international law, as well as under many laws and regulations that exist at the national level. In the Indonesian context, the right to know is addressed by the 1945 Constitution, Law No. 14 of 2008 on the Disclosure of Public Information and Government Regulation No. 61 of 2010 on the Implementation of the 2016 Regulation, among other regulations. Moreover, last February, the Ministry of State Secretariat issued Regulation No. 2 of 2016 on Security Classification and Access to the Archives of the Ministry of State Secretariat (“2016 Regulation”), which offers guidelines for state officials as regards the disclosure of information to internal staff or to the general public. This week’s ILD offers analysis on how far the 2016 Regulation goes towards ensuring the right to know for Indonesia's citizens, as well as its major business players, and also addresses the issue of whether or not the 2016 Regulation conflicts with any other existing laws or regulations.
Indonesian Forestry 101: Classification and Utilization of Forestry Areas
Indonesia can boast some of the most extensive and biologically diverse areas of tropical forest in the world. Moreover, the country’s forests have amazing potential for development and utilization, and many individuals and businesses are attempting to utilize and even exploit the entirety of the natural resources contained therein to the very limits of their abilities. However, limits have indeed been set on the utilization of the country’s forests in order to ensure balance and the overall protection of the environment. Indonesia’s forests are controlled under several laws and regulations, including Law No. 41 of 1999 on Forestry, Law No. 5 of 1990 on the Conservation of Living Natural Resources and Ecosystems and Law No. 32 of 2009 on the Protection and Management of the Environment. This week’s ILD offers a general outline of Indonesia’s forests and their various classifications, as well as the procedures which have to be followed in order to secure permits for the utilization of timber and/or non-timber forestry products in areas of production forest.
Startups 101: Business Models and General Licenses
As one of the most populous nations in the world, not to mention one of Asia's most vibrant marketplaces, Indonesia offers numerous opportunities for the development of profitable startup companies. And indeed, many young entrepreneurs are currently attempting to establish startups across Indonesia. However, in doing so, there are a number of important areas that have to be considered, such as the formulation of a suitable business model and the securing of the necessary licenses. This week’s ILD offers a general outline of a number of different business models which are suitable for startups, as well as a rundown of the various licenses that should be secured by entrepreneurs prior to the rendering of any services to the general public.
Tax, Customs and Excise Breaks for Businesses Located Within Special Economic Zones
Since the official implementation of the Tax-Amnesty program last July, which mandates that certain assets should be repatriated to Indonesia, the government is pushing forward with a number of initiatives relating to the channeling of future investments. One alternative open to any new investors is the option to establish businesses in special economic zones (Kawasan Ekonomi Khusus – “KEK”). In order to accommodate this initiative, the Minister of Finance has issued Regulation No. 104/PMK.010/2016 on Tax, Customs and Excise Treatments in Special Economic Zones (“2016 Regulation”). In essence, this regulation set out further details relating to the various tax, custom and excise facilities, as well as various breaks which can be enjoyed by any companies or businesses which are engaging in commercial activities within KEKs.
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