Amendments to Law on Legislation Formation Challenged

Late last year on November 25, 2021, the Indonesian Constitutional Court ruled against the Government in its Decision No. 91/PUU-XVIII/2020 (the “Decision”) regarding the constitutionality and validity of Law No. 11 of 2020 on Job Creation (the “Job Creation Law”). The decision declares the Job Creation Law as “conditionally unconstitutional,” due to the absent legal basis on the formality of such law drafting (known as the omnibus method), for two years as of the date of the Decision.

As required under the Decision, the Parliament and the Government rectify the “conditional unconstitutional” nature of the Job Creation Law by amending Law No. 12 of 2011 on Legislation Formation (the “Legislation Law”) with Law No. 13 Year 2022 on Second Amendment to Law No. 12 of 2011 on Legislation Formation (the “2022 Amendment”). The 2022 Amendment was enacted on June 16, 2022. Five implementing regulations should be issued following the 2022 Amendment.

Recently, a petition formal and material review of the 2022 Amendment was filed to the Constitutional Court under case register number 69/PUU-XX/2022. In this petition, the petitioner seeks the review of the amended Article 64 paragraph (1b); Article 72 paragraphs (1a) and (1b); and Article 73 paragraphs (1) and (2) of the Legislation Law in the 2022 Amendment. The first hearing was held on August 24, 2022, while the second hearing is scheduled on September 8, 2022.

In addition to the introduction to the omnibus method on legislation formation, the 2022 Amendment sets out (i) clearer public’s participation and involvement in the legislation formation processes, (ii) electronic legislation formation, and (iii) rectification of errors in draft legislation after the legislation has been approved by the Parliament.We set out below the key provisions of the 2022 Amendment.

  • Omnibus Method in Legislation Formation

Under the 2022 Amendment, the omnibus method is now introduced as a method for legislation formation which combines multiple laws into a single law. However, there are certain limitations as to when the omnibus method may be used as follows:

–                  to add new provisions to existing laws;

–                  to revise multiple laws that are related to each other and/or that are drafted to achieve the same objective; and

–                  to revoke multiple laws of the same type and hierarchy.

It is also important to note that all laws using the omnibus method may only amended and revoked using the omnibus method as well.

  • Electronic Legislation Formation

With the 2022 Amendment, the Legislation Law now introduces electronic legislation as a method of lawmaking. Article 97B of the Legislation Law enables the electronic signing of laws through certified electronic signatures. In this context, the Legislation Law expressly declares that laws that are electronically enacted and signed are equally enforcable as laws that are enacted and signed conventionally.

  • Strenghthening Public Participation

Although the Legislation Law prior to the 2022 Amendment already contained provisions to encourage public participation under its Article 96, the 2022 Amendment further strengthens by amending the said article. The 2022 Amendment promotes the overall public participation and public openness by enabling online public participation, creating easy public access to the academic script of a draft bill and the draft itself, as well as involving in public discussions and consultations with regard to the law drafting.

  • Technical Errors Fix in Legislation Formation

The 2022 Amendment allows lawmakers to correct or rectify technical errors in a bill which has been approved by the People’s Representative Council (Dewan Perwakilan Rakyat or the “Parliament”) and the President. The correction requires consents from the chairman of the relevant Parliament committee and officers. If other errors are found after a law is enacted, such correction may be done by the ministry of secretariat affairs and the relevant ministry along with the relevant Parliament’s committee.

September 8, 2022

AKSET

Please contact Johannes C. Sahetapy-Engel (jsahetapyengel@aksetlaw.com) or Clara Anastasia So (canastasia@aksetlaw.com) for further information.

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