Government Reregulates Utilization of Natural Gas by Power Plants
In a bid to increase the utilization of natural gas by power plants while ensuring supplies of natural gas for purchase by the electrical power sector at fair and competitive prices, the Ministry of Energy and Mineral Resources recently issued Regulation No. 45 of 2017 on the Utilization of Natural Gas by Power Plants. This new regulation addresses several provisions which pertain to the following matters: 1) Natural-gas supplies for power plants; 2) Natural-gas pricing; 3) Natural-gas distribution tariffs; 4) Natural-gas sale-and-purchase agreements; 5) Natural-gas allocation periods; and 6) The development of power plants which utilize natural gas in their wellheads.
OJK Regulates Implementation of Commercial Bank Compliance
To minimize the risks inherent to commercial banking business in both a preventative and curative manner, the Financial Services Authority has issued Regulation No. 46/POJK.03/2017 on the Implementation of Commercial Bank Compliance. This new regulation makes a minor alteration to the provisions which were originally set out under Bank Indonesia Regulation No. 13/2/PBI/2011 on the same matte. Essentially, this regulation addresses several matters, including: 1) Compliance function; 2) Director of compliance; and 3) Sanctions.
Govt. Introduces Greater Flexibility for Oil-and-Gas Contractors Operating under Gross-Split Production Sharing Contracts
The government is putting a lot of effort into ensuring that oil-and-gas contractors operate under the Gross-Split Production Sharing Contract (GS-PSC) scheme. After witnessing the apparent reluctance of contractors to engage in these contracts however, which are believed to be unfavorable to their businesses, the Ministry of Energy and Mineral Resources has finally issued Regulation No. 52 of 2017, which amends Ministry Regulation No. 8 of 2017 on Gross-Split Production Sharing Contracts. Under this new GS-PSC regulation, the government is offering more attractive contractors’ takes, which were previously set in a more limited sense under the previous regulation.
Draft Presidential Regulation on the Implementation of Patents by Patent Holders
The government is currently deliberating the Draft Presidential Regulation on the Implementation of Patents by Patent Holders, which essentially requires patent holders to produce products or utilize the relevant patented process within Indonesia. However, in the event that patent holders are not yet ready to implement patents within Indonesia, then they are allowed to apply for a patent implementation postponement from the Ministry of Law and Human Rights.
Supreme Court Partially Annuls Regulation Regarding Application-Based Transportation Services
The Supreme Court has rendered Decision No. 37 P/HUM/2017 on the Petition for Judicial Review of Ministry of Transportation Regulation No. PM 26 of 2017 on the Organization of Non-Fixed-Route Public-Transportation Services. The recently rendered MA Decision annuls seven legal issues initially addressed under Regulation 26/2017 due to their conflicting with both the UMKM Law and Road Transportation Law.
Procedures for Land Freezes and Land Seizures
The Ministry of Agrarian Affairs and Spatial Planning/Head of the National Land Agency has now codified provisions which relate to the recording of land freezes and land seizures into a single regulation, specifically Regulation No. 13 of 2017 on Procedures for Land Freezes and Land Seizures. The regulation sets out provisions which address the requirements and procedures which have to be met when attempting to invoke land freezes and land seizures.
New Mechanism for Purchase of Electricity from Renewable-Energy Power Plants
In order to create a better investment climate as regards the renewable energy sector, the Ministry of Energy and Mineral Resources has issued Regulation No. 50 of 2017 on the Utilization of Renewable-Energy Resources for the Production of Electricity. This new regulation basically adds one new type of renewable energy which can be utilized for the production of electricity. The regulation also redefines the purchase mechanism for any electricity which is generated by renewable-energy power plants.
OJK Codifies Periodic Reporting Obligation for Insurance-Related Companies
In a bid to codify provisions which relate to reporting obligations for Insurance-Related Companies, the OJK has issued Regulation No. 55/POJK.05/2017 on Periodic Reporting by Insurance Companies. In brief, Regulation 55/2017 re-regulates the list of periodic reports that should be submitted by each type of company operating within the insurance industry, as well as administrative sanctions for non-compliance.
Hospital Accreditation Reregulated
In order to implement Article 40 (4) of Law No. 44 of 2009 on Hospitals, as well as to improve the quality of hospital services, the Ministry of Health has issued Regulation No. 34 of 2017 on Hospital Accreditation. This new regulation repeals and replaces the now obsolete Ministry Regulation No. 12 of 2012 on the same matters and updates several provisions which pertain to the following areas: 1) Hospital accreditation; 2) The accreditation process; 3) Supervision; and 4) Transitional provisions.
Income Tax for Dividends Acquired from Foreign-Controlled Companies Modernized
The Ministry of Finance has issued Regulation No. 107/PMK.03/2017 on the Determination of the Moment of Acquisition of Dividends and the Basis for Their Calculation by Domestic Taxpayers for Capital Participation in Overseas Companies, in order to ensure greater legal certainty for domestic taxpayers who invest in foreign-controlled, non-listed companies. This regulation addresses several provisions which pertain to the following matters: 1) Criteria for non-listed foreign companies; 2) Deemed dividends; 3) Foreign tax credits; 4) Pass-through entities; and 5) Dividends from multiple countries.