Electricity 2022
Reproduced with permission from Law Business Research Ltd. This article was first published in Lexology Getting the Deal Through – Electricity 2022 (Published: October 2021). For further information please visit www.gettingthedealthrough.com
Author from AKSET: Arfidea Dwi Saraswati, Andi Manggoana Wira Tenri, and Mochamad Fatih Satria Kasmaliputra
Electricity 2022
Indonesian Constitutional Court Reviewed Article 15 (2) of Fiduciary Security Law,
On August 31, 2021, the Constitutional Court (Mahkamah Konstitusi) rendered its decision number 2/PUU-XIX/2021 (“Decision No. 2/2021”) in relation to the judicial review of Article 15 paragraph (2) of Law No. 42 of 1999 dated September 30, 1999, on Fiduciary Security (the “Fiduciary Security Law”). Briefly, the petition for the review was submitted by Joshua Michael Djami, an employee of a finance company. The petitioner is an internal collector and is certified in the collection sector. The petitioner claimed that certain provisions in the Fiduciary Security Law were unconstitutional, against their constitutional rights, and detrimental to his line of work, specifically in collection and enforcement of encumbered goods.
The Constitutional Court previously decided based on its decision number 18/PUU-XVII/2019 (“Decision No. 18/2019”) the following:
- The phrases the ‘enforcement power’ (kekuatan eksekutorial) phrase and the ‘similar to a final and binding decision’ (sama dengan putusan pengadilan yang berkekuatan hukum tetap) phrase contained in Article 15 paragraph (2) of the Fiduciary Security Law and the ‘event of default’ (cidera janji) phrase contained in Article 15 paragraph (3) of the Fiduciary Security Law are unconstitutional;
- Article 15 paragraph (2) of Fiduciary Security Law must be interpreted that if the parties do not agree on an event of default and the debtor does not voluntarily surrender the object of the fiduciary security, the enforcement of the fiduciary security must then be conducted in the manner and mechanism for the enforcement of a final and binding court decision (i.e., through court enforcement procedures); and
- In interpreting Article 15 paragraph (3) of the Fiduciary Security Law, an event of default should not be decided unilaterally by a creditor, but by an agreement of the parties or through a legal measure determining such event of default.
Article 15 paragraph (3) of the Fiduciary Security Law enables the unilateral enforcement (parate eksekusi) that was declared unconstitutional by Decision No. 18/2019. So, the enforcement may not be implemented in the absence of an acknowledgement by the debtor of a breach of contract, and the voluntary surrender of the object under the fiduciary agreement.
Decision No. 2/2021 further reiterates the above decision provided that the request for enforcement by the district court is only as an alternative which may be taken by a creditor if the parties did not acknowledge and/or agree with the occurrence of breach of contract, and the voluntary surrender of the fiduciary object.
In conclusion, after the assessment of the facts and the laws, the Court rejected the petition for review in its entirety by the applicant and reiterated Decision No. 18/2019 pertaining to the enforcement of fiduciary certificates. If a debtor did not acknowledge a breach of contract on its part, and is reluctant to voluntarily surrender the object, then the creditor is prohibited from unilaterally enforcing the fiduciary. The creditor is required to request for an execution order from the relevant district court. Further, the Court decided that this means of execution has indeed provided protection to all elements/parties (i.e., the debtor, the creditor and the fiduciary object) and that the request for execution to the court provides protection between the parties and prevents arbitrariness in the execution of such object.
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September 22, 2021
Please contact Johannes C. Sahetapy-Engel (jsahetapyengel@aksetlaw.com), or Datanya Nuga Kalula (dkalula@aksetlaw.com) for further information.
Disclaimer:
The foregoing material is the property of AKSET and may not be used by any other party without prior written consent. The information herein is of general nature and should not be treated as legal advice, nor shall it be relied upon by any party for any circumstance. Specific legal advice should be sought by interested parties to address their particular circumstances.
Any links contained in this document are for informational purposes and are available and relevant at time this publication is made. We provide no liability whatsoever in respect of any information or content in such links.
Government Addresses Industrial Relation Problems Caused by the Pandemic
With the Covid-19 pandemic that has yet to show signs of abating anytime soon, the Government continues to implement the Micro Scale Public Activity Restriction (Pembatasan Kegiatan Masyarakat Berbasis Mikro or PPKM) at different levels. The pandemic has caused many employers to implement the work-from-home policies, if not reducing employees’ wages or laying off employees to closure.
In an effort to shed light on the public’s perception on determining the fair labor relation decisions at the workforce due to the pandemic, the Government has issued several regulations aimed at addressing these labor problems, such as the Minister of Manpower (the “MOM”) Regulation No. 2 of 2021 dated February 15, 2021 on Implementation of Remuneration in Certain Labor-Intensive Industries during the Corona Virus Disease 2019 (Covid-19) Pandemic (“Regulation 2/2021”) which governs wage adjustment in certain industries affected by Covid-19.
More recently, the MOM issued Decree No. 104 of 2021 dated August 13, 2021 on Guidelines on the Implementation of Industrial Relations During the Covid-19 Pandemic (“Decree 104/2021”). Decree 104/2021 is a guideline as to how business policies should be carried out in the industrial relations setting. With this decree in place, it is hoped that both employers and employees have more clarity in understanding their rights and obligations, as well as in implementing internal workforce arrangements to stay in accordance with government policies practice.
In our view, Decree 104, unfortunately, offers no new matters for employers as whatever employers wish to carry out, the consents of the employees are required. In general, employers are actually looking for the ability to determine certain matters without any consent from their employees.
We set out below the key provisions of Decree 104/2021.
- Work Models During the Covid-19 Pandemic
As preventive measures to avoid face-to-face contact as ordered through the government’s Covid-19 restriction policies, two work models are now recognized — the Work From Office (“WFO”) model where employees work from their offices as usual or the Work From Home (“WFH”) model where employees carry out their work remotely, from their houses. As the Government will have varying iterations of the WFO and WFH policies depending on the situation at present, Decree 104/2021 requires that business entities should always refer and adapt to the latest Governmental policies, and recommends internal discretions covering on the (i) the maximum capacity for the WFO model; (ii) the reduced office hours; and (iii) alternation between the WFO and the WFH.
- Remuneration or Other Rights of Employees
Remuneration and income protection for employees is another key matter regulated in Decree 104/2021. This issue was also addressed in Regulation 2/2021. However, Regulation 2/2021 is only applicable for certain industries. Decree 104/2021 sets out the provisions on remuneration adjustments. As a general rule, any adjustment made to an employee’s remuneration or other rights must be based on a mutual agreement between the employer and the employee, with details as follows.
- Remuneration for Employees Carrying Out the WFO/WFH Model
Employees facilitating the WFO, WFH or a combination of both models are still entitled to their pay. However, employers who are unable to fully pay the remuneration to their employees due to financial conditions may make adjustment to the employee’s pay. This adjustment must be based on an agreement between the employer and employee and must be conducted fairly and proportionately by considering the livelihood of the employees and the going concern of the business. However, Decree 104/2021 does not stipulate further regarding the calculation or examples on what constitutes ‘fair and proportionate’ adjustments.
- Remuneration for Temporarily Furloughed Employees
Temporarily furloughed employees are still to be paid normally. However, if a furloughed employee’s employment contract or company regulation specifically governs furlough payment, the remuneration shall refer to such contract or regulation. If the employer is financially unable to pay the remuneration to their employees, then an adjustment to the wages based on mutual agreement can be made with the caveat that the employee shall still receive wages for the relevant month.
- Adjustment on Remuneration/Other Rights of Employees
As stated above, any wage adjustment during the Covid-19 pandemic must be made based on a mutual agreement achieved from a family-like, good-faith, and transparent dialogue between an employer and its employees. The output of such agreement shall be stated in writing to be submitted to the employees, and reported to the Labor Office at the provincial level online, containing the following items:
- amount of wages;
- payment of wages (whether wages are to be paid directly or in stages); and
- duration of the agreement.
There is currently no further elaboration on this reporting procedure to the Labor Office.
It also is to be noted for employers, however, that the wage that will be used to calculate the social security premium and benefits, the termination benefits, and other rights shall be the wage before the mutually agreed adjustment and not after. This is again another unfavorable provision for employers.
- Prevention of Employment Termination
Aimed at also preventing termination of employment by employers, Decree 104/2021 requires every employer, employees, employee’s associations, and the Government itself to work together in prioritizing an alternative solution in order to avoid termination of employment. Decree 104/2021 provides the following steps that may be taken by an employer to prevent employment termination:
- Adjusting workplace settings to cut production or operation costs of the company;
- Adjusting working hours by regulating work shifts, removing/reducing overtime, and reducing working hours or working days;
- Implementing temporary furloughing employees alternatively;
- Adjusting the amount of wages or payment method of wages;
- Gradually reducing employees’ facilities and/or benefits;
- Not extending a definite term employment contract that expires; and/or
- Granting pension for employees that have fulfilled the criteria or offering early pension.
Similar to wage adjustments, the abovementioned preventive steps must also be based on a bipartite dialogue through mutual consent. Only if all necessary actions have been taken but employment termination is still unavoidable, then employment termination may be sought and taken in accordance with the prevailing laws and regulations.
All in all, in our view Decree 104/2021 does not provide any new provision for employers that face difficulties due to the pandemic as any action taken by an employer requires the consent of its employees.
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August 23, 2021
Please contact Johannes C. Sahetapy-Engel (jsahetapyengel@aksetlaw.com), Clara Anastasia So (canastasia@aksetlaw.com), or Caleb K. N. Sitorus (csitorus@aksetlaw.com) for further information.
Disclaimer:
The foregoing material is the property of AKSET and may not be used by any other party without prior written consent. The information herein is of general nature and should not be treated as legal advice, nor shall it be relied upon by any party for any circumstance. Specific legal advice should be sought by interested parties to address their particular circumstances.
Any links contained in this document are for informational purposes and are available and relevant at time this publication is made. We provide no liability whatsoever in respect of any information or content in such links.
Government Addresses Industrial Relation Problems Caused by the Pandemic
Government Pushes Back Risk-based OSS System Launch
Following up on the Ministry of Investment or Capital Investment Coordinating Board’s (“BKPM”) decision to launch the Risk-based Licensing Online Single Submission System (“Risk-based OSS System”) through its Circular Letter No. 17 of 2021 on the Shift of Business Licensing System to Risk-based Business Licensing through the OSS System dated July 27, 2021 (“CL 17/2021”), the government has decided to postpone the implementation of the Risk Based OSS system as stipulated in Circular Letter No. 18 of 2021 on Amendment to CL 17/2021 (“CL 18/2021”) dated July 29, 2021 and BKPM Announcement No. 8 of 2021 dated August 2, 2021 (the “Announcement”).
The initial plan was to launch the Risk-based OSS System with a majority of the KBLI Codes under Government Regulation No. 5 of 2021 on the Implementation of Risk-based Licensing dated February 2, 2021 (“GR 5/2021”) while relying temporarily on a BKPM Decree for the 353 KBLI codes not yet accounted for in the system. However, there are several changes and revisions to the list of 353 KBLI codes as can be seen in CL 18/2021, such as Account and Audit Activities being placed under the Ministry of Finance (previously under Ministry of Tourism and Creative Economy), Toll Road Activities being under the Ministry of Public Works and Public Housing (previously under Ministry of Transport) and various other changes. The Announcement then explains that since there are revisions to the KBLI codes, the system must be updated accordingly.
As the current OSS system has already been suspended in preparation for the initial launch, the BKPM has decided that business licensing will be temporarily suspended until the system is up and running. Currently, there is no detail as to when the Risk-based OSS will launch.
We expect to hear more about the hopefully imminent launch of the Risk-based OSS System in the near future.
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August 3, 2021
Please contact Inka Kirana (ikirana@aksetlaw.com), N. Sekar Lestari (nlestari@aksetlaw.com) or Caleb K. N. Sitorus (csitorus@aksetlaw.com) for further information.
Disclaimer:
The foregoing material is the property of AKSET and may not be used by any other party without prior written consent. The information herein is of general nature and should not be treated as legal advice, nor shall it be relied upon by any party for any circumstance. Specific legal advice should be sought by interested parties to address their particular circumstances.
Any links contained in this document are for informational purposes and are available and relevant at time this publication is made. We provide no liability whatsoever in respect of any information or content in such links.
Government Pushes Back Risk-based OSS System Launch
Risk-based Licensing OSS System Soft Launching
As the current business licensing regime comes to its end, the government is currently making preparations for the shift into the Risk-based Licensing system first introduced in Law No. 11 of 2020 dated November 2, 2020 on Job Creation (“the “Job Creation Law”).
The groundwork for this change has already been set through various implementing regulations such as Government Regulation No. 5 of 2021 dated February 2, 2021 on Implementation of Risk Based Licensing (“GR 4/2021”), Capital Investment Coordinating Board (“BKPM”) Regulation No. 4 of 2021 dated March 29, 2021 on Guidelines and Procedures for Risk-based Business Licensing Administration and Investment Facilities, and various other regulations. Now, the government is arranging for the introduction of Risk Based Licensing to the Online Single Submission (“OSS”) system.
To support the above, the Minister of Investment/Chairman of BKPM issued his Circular Letter No. 17 of 2021dated July 27, 2021 on the Shift of Business Licensing System to Risk-based Business Licensing through the OSS System (“CL 17/2021”). CL 17/2021 provides that the OSS Risk-based Licensing System will have its soft launching on August 2, 2021 at 06:00 WIB. To prepare for this launch, there are several things that business entities/potential business entities may want to take note of, as highlighted below:
- The current OSS System (the OSS version 1.1) will be terminated on July 30, 2021 at 18:00 WIB in order to transfer data to the Risk Based Licensing OSS System. Applicants intending to make submissions are advised to do so before July 30, 2021, 00:00 WIB;
- Business Entities are advised to settle their commitment fulfilment for the licenses they applied before July 30, 2021 00:00 WIB so that the OSS System may issue the relevant license by July 30, 2021 on 18:00 WIB.
Furthermore, at the time of the soft launch, 1,702 business activities classified under 1,349 KBLI will be ready and available for the risk-based business licensing process at the OSS. Another 353 KBLI is not yet regulated by GR 5/2021 so a decree from the BKPM is required. The government expects that the Risk-based Business Licensing OSS System will be fully operational by end of August 2021.
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July 30, 2021
Please contact Inka Kirana (ikirana@aksetlaw.com), N. Sekar Lestari (nlestari@aksetlaw.com) or Caleb K. N. Sitorus (csitorus@aksetlaw.com) for further information.
Disclaimer:
The foregoing material is the property of AKSET and may not be used by any other party without prior written consent. The information herein is of general nature and should not be treated as legal advice, nor shall it be relied upon by any party for any circumstance. Specific legal advice should be sought by interested parties to address their particular circumstances.
Any links contained in this document are for informational purposes and are available and relevant at time this publication is made. We provide no liability whatsoever in respect of any information or content in such links.
Risk-based Licensing OSS System Soft Launching
Foreign Nationals May Now Extend Their ITAS/ITAP Outside Indonesia
To follow up and clarify the Director General of Immigration (the “DGIM”) Circular Letter No. IMI-0661.GR.01.01 of 2021 dated March 26, 2021 regarding Visas and Stay Permits During the New Normal Adaptation Period (“CL 0661”), the DGIM issued Circular Letter No. IMI-0158.GR.01.01 of 2021 dated July 16, 2021 on Provisions Regarding Stay Permits for Foreign Nationals with ITAS/ITAP who Reside Overseas (“CL 0158”).
Previously, CL 0661 provides that foreign nationals within Indonesia may extend or apply for a new permit by visiting the local immigration offices. However, CL 0661 did not regulate any procedure for foreign nationals holding Temporary Stay Permits (Izin Tinggal Terbatas or an “ITAS”) or Permanent Stay Permits (Izin Tinggal Tetap or ab “ITAP”) that wish to extend their permits but are outside Indonesia.
By mandate of CL 0158, the immigration offices will receive ITAS/ITAP extension requests for foreign nationals outside Indonesia through their guarantors. The procedure is as follows:
- A guarantor submits a copy of passport of the relevant expatriate;
- Requests may be submitted without any biometrics, subject to the approval of the DGIM;
- Guarantors must report Foreign Nationals’ entry to the Immigration office within 30 days after arrival in order to receive the ITAS/ITAP or Re-entry Permit.
The above procedure may be done by the guarantor manually or electronically.
Provisions regarding immigration will continuously be evaluated as the Covid-19 situation develops.
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July 23, 2021
Please contact Johanes C. Sahetapy-Engel (jsahetapyengel@aksetlaw.com) or Caleb K. N. Sitorus (csitorus@aksetlaw.com) for further information.
Disclaimer:
The foregoing material is the property of AKSET and may not be used by any other party without prior written consent. The information herein is of general nature and should not be treated as legal advice, nor shall it be relied upon by any party for any circumstance. Specific legal advice should be sought by interested parties to address their particular circumstances.
Any links contained in this document are for informational purposes and are available and relevant at time this publication is made. We provide no liability whatsoever in respect of any information or content in such links.
Foreign Nationals May Now Extend Their ITAS/ITAP Outside Indonesia
Government Implements More Stringent Limitations Through Emergency PPKM
In an effort to curb the continued substantial rise of Covid-19 cases across the country, the Government has decided to implement the Entry into Force of Emergency Public Activity Restriction (Pemberlakuan Pembatasan Kegiatan Masyarakat Darurat or the “Emergency PPKM”) starting from July 3, 2021 which will be in place until July 20, 2021. DKI Jakarta’s Emergency PPKM policies are enacted through Governor of DKI Jakarta Decree No. 875 of 2021 dated July 2, 2021 on Emergency PPKM (“Decree 875/2021”). This round of restrictions introduces more stringent activity limitations compared to the Micro-Scale Public Activity Restriction (Pemberlakuan Pembatasan Kegiatan Masyarakat Berbasis Mikro or the “Micro PPKM”) that was effective for the past few months, last updated in DKI Jakarta Governor No. 759 of 2021 dated June 14, 2021 on Micro PPKM. The key changes found in Decree 875/2021 are as follows.
Activities in Workplaces/Offices
Previously, offices (barring those in the essential sector) had to implement a 75% or 50% Work From Home (“WFH”) order, for red and orange/yellow zones respectively. Now, all non-essential sectors must carry out a 100% WFH policy. Meanwhile, essential/critical sectors have the capacity for Work From Office (“WFO”) as follows:
- Essential Government Sectors: essential public services that may not be delayed are allowed 25% WFO;
- Essential Sectors: financial services, banks, capital markets, payment systems, information technology, non Covid-19 quarantine hotels, and export industries are allowed 50% WFO;
- Critical Sectors: energy, health, safety, logistics and transportation, food and beverage along with its supporting activities, petrochemicals, cement, vital national objects, disaster management, national strategic projects, construction, basic utilities (electricity and water) and basic needs industries are allowed 100% WFO.
In relation to these restrictions in the office environment, Head of the Manpower, Transmigration and Energy Office of DKI Jakarta issued Decree No. 1881 of 2021 dated July 2, 2021 on the Protocol for the Prevention and Control of Covid-19 in Private, State-Owned Business Entity, Regional-Owned Business Entity Offices/Workplaces (the “Manpower Office Covid-19 Protocols”). In essence, the Manpower Office Covid-19 Protocols provide the guidelines on what offices should do in light of the enactment of the Emergency PPKM. Generally, private/state-owned/regionally owned offices are expected to form a Covid-19 unit to handle matters related to Covid-19 management in the offices. This Covid-19 team must ensure that the office restrictions and health protocols (e.g., the 25%/50%/75% WFO, physical distancing, regular sanitation, availability of hand sanitizers, etc.) are being duly implemented in the offices. Further, these Covid-19 teams must aid the government in terms of reporting and tracing of Covid-19 cases in the offices.
Education Activities
All schools, higher education, academies, places of education/training must carry out their activities fully remotely/online, whereas previously they may do offline learning based on instructions from the Ministry of Education, Culture, Research and Technology.
Dining Activities/Restaurants
All restaurants, eateries, cafes, food stalls/vendors may only be opened for take-away. Dine-in is fully prohibited.
Activities in Malls/Shopping Centers
Malls and shopping centers are temporarily closed. However, accesses to restaurants and supermarkets inside the malls are still open, with the restrictions on restaurants still apply.
Religious Activities
Mosques, musholas, churches, pagodas, monasteries and other public places designated for religious activities are temporarily closed.
Activities in Public/Other Areas that May Attract Masses
All public areas, parks, tourist attractions, art/culture venues, sports facilities and other social activities are temporarily closed/suspended. Wedding receptions have a maximum attendance of 30 people and are not allowed to serve food, food may still be given out to be taken home in sealed containers.
Similar to the Micro PPKM, the Emergency PPKM also applies country-wide based on Minister of Home Affairs (the “Minister”) Instruction No. 15 of 2021 dated July 2, 2021 on Emergency PPKM and Establishment of Posts for Covid-19 Management in Villages and Urban Villages to Manage the Spread of Covid. Although the exact terms of the Emergency PPKM of each province may differ, governors and regents across Indonesia must comply with the limitations laid out in the Minister’s Instruction.
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July 5, 2021
Please contact Johanes C. Sahetapy-Engel (jsahetapyengel@aksetlaw.com) or Caleb K. N. Sitorus (csitorus@aksetlaw.com) for further information.
Disclaimer:
The foregoing material is the property of AKSET and may not be used by any other party without prior written consent. The information herein is of general nature and should not be treated as legal advice, nor shall it be relied upon by any party for any circumstance. Specific legal advice should be sought by interested parties to address their particular circumstances.
Any links contained in this document are for informational purposes and are available and relevant at time this publication is made. We provide no liability whatsoever in respect of any information or content in such links.
Government Implements More Stringent Limitations Through Emergency PPKM
New Work From Home Policy Under Micro PPKM Extension
With the surge of Covid-19 cases after the Idul Fitri Holiday in Jakarta, DKI Jakarta Governor Anies Baswedan decided to mandate a 75% Work From Home (“WFH”) order for both private and government offices located in in the red zones and 50% WFH order for the same offices in the yellow and orange zones. This order is a part of the policies enacted through the 10th iteration of the Entry into Force of Micro-Scale Public Activity Restriction (Pemberlakuan Pembatasan Kegiatan Masyarakat Berbasis Mikro or the “Micro PPKM”), which is enforced through Governor of DKI Jakarta Decree No. 759 of 2021 on the Extension of Micro PPKM dated June 14, 2021 (“Decree 759/2021”). The duration for the current iteration of the Micro PPKM will be from June 15 until June 28, 2021.
The only change to Micro PPKM policies in Decree 759/2021, other than the WFH order, is the suspension of offline learning trial programs. Under the Governor’s Decree No. 671 of 2021 on the Extension of Micro PPKM dated May 31, 2021 (the “Previous Decree”), educational institutions may conduct their activities either online or offline, with the offline activities being limited to those part of the offline learning trial program. Currently, these trial programs are suspended and educational institutions in red, orange and yellow zones are to conduct their learning activities online. However, educational institutions in orange and yellow zones may conduct offline learning based on the technical instructions from the Ministry of Education, Culture, Research and Technology.
Not only in Jakarta, the Micro PPKM is applicable for the entire country Minister of Home Affairs (the “Minister”) Instruction No. 13 of 2021 dated June 14, 2021 on the Extension of the Entry into Force of the Micro PPKM and Establishment of Posts for Covid-19 Management in Villages and Urban Villages to Manage the Spread of Covid-19. While Governors across Indonesia are allowed to regulate the details of the Micro PPKM extension in each of their respective regions, the Minister’s Instruction does set limitations to certain activities and sectors (i.e., offices, schools, essential sectors, recreational activities, construction and religion activities) that must be followed.
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June 22, 2021
Please contact Johanes C. Sahetapy-Engel (jsahetapyengel@aksetlaw.com) or Caleb K. N. Sitorus (csitorus@aksetlaw.com) for further information.
Disclaimer:
The foregoing material is the property of AKSET and may not be used by any other party without prior written consent. The information herein is of general nature and should not be treated as legal advice, nor shall it be relied upon by any party for any circumstance. Specific legal advice should be sought by interested parties to address their particular circumstances.
Any links contained in this document are for informational purposes and are available and relevant at time this publication is made. We provide no liability whatsoever in respect of any information or content in such links.
New Work From Home Policy Under Micro PPKM Extension
Government Amends PR 10/2021—Certain Business Lines Relating to Alcoholic Beverages Now Closed for Investment
The issuance of Presidential No. 10 of 2021 dated February 2, 2021 on Capital Investment Activities (the “PR 10/2021”) sparked major backlash from the Indonesian public due to the regulation opening the alcoholic beverage industry for investment. After listening to the people’s concerns, the government promised to reconsider its stance on opening the alcoholic beverage industry—as conveyed by President Joko Widodo in a public address on March 2, 2021, which is then followed up with the issuance of Presidential Regulation No. 49 of 2021 dated May 24, 2021 (the “PR 49/2021”) on the Amendment of PR 10/2021.
While PR 10/2021 states that all business lines (save for those that are closed or reserved for the Central Government) are open for investment, PR 49/2021 further elaborates that the business lines that are open are those that are commercial in nature. Additionally, PR 49/2021 adds Alcoholic Beverage Industry (KBLI 11010), Wine Industry (KBLI 11020), and Beverages Containing Malt Industry (KBLI 11031) to the list of industries that are closed off for investment.
As stipulated under PR 10/2021, businesses that are open for investment are divided into four categories: (i) priority business lines; (ii) business lines that are allocated or required for partnership with cooperatives and Micro, Small and Medium Enterprises (“UMKM”); (iii) business lines open with certain requirements; and (iv) other business lines not included in the foregoing, which shall be open for all investors. Previously, the “certain requirements” as mentioned in number (iii) are as follows:
- closed for foreign investors (only open for Indonesian Investors);
- has a cap on its foreign investment; or
- requires special license.
Under PR 49/2021 a new requirement is added: “Business lines that are monitored and stringently regulated and are also subject to other regulations in the field of the management and monitoring of alcoholic beverages.” Business lines that fall under this category are Wholesale Trade of Alcoholic Beverage (KBLI 46333), Retail Trade of Alcoholic Beverages (472221), and Small-scale (Kaki Lima) Retail Trade of Alcoholic Beverages (KBLI 47826).
Besides the addition of provisions relating to the alcohol industry, PR 49/2021 also contains some amendments to its Annexes, which list out all business lines and KBLI that falls under 4 categories of businesses opened for investment as mentioned above. These amendments include the additions of some provisions for certain business lines to qualify for government incentives, the re-allocation of certain business lines that were previously placed in Annex 3 (open for investment with certain requirement) to Annex 2 (allocation for or partnership with UMKM), such as the batik industry, traditional medicine industry, etc., along with the addition and/or removal of some business lines from the Annexes.
We believe that the amendments of PR 10/2021 introduced in PR 49/2021 will still achieve its goal of attracting potential investors, despite the fact that some business fields relating to the alcohol industry are now closed for investment.
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June 14, 2021
Please contact Inka Kirana (ikirana@aksetlaw.com), N. Sekar Lestari (nlestari@aksetlaw.com), or Caleb K. N. Sitorus (csitorus@aksetlaw.com) for further information.
Disclaimer:
The foregoing material is the property of AKSET and may not be used by any other party without prior written consent. The information herein is of general nature and should not be treated as legal advice, nor shall it be relied upon by any party for any circumstance. Specific legal advice should be sought by interested parties to address their particular circumstances.
Any links contained in this document are for informational purposes and are available and relevant at time this publication is made. We provide no liability whatsoever in respect of any information or content in such links.
Government Further Extends Micro PPKM
On May 31, 2021, the Governor of DKI Jakarta issued Decree No. 671 (“Decree 671/2021”) on the Extension of the Entry into force of Micro-Scale Public Activity Restriction (Pemberlakuan Pembatasan Kegiatan Masyarakat Berbasis Mikro or the “Micro PPKM”). Decree 671/2021 marks the 9th stage of Micro PPKM, which was first enacted on February 9, 2021 and was lastly extended under Governor of DKI Jakarta Decree No. 615 of 2021 dated May 17, 2021 on the Extension of the Entry into Force of Micro PPKM (“Decree 615/2021”).
While there is virtually no change in terms of the provisions between Decree 671/2021 and Decree 615/2021, the government intends to upgrade testing, tracing and treatment processes in order to curb the pandemic.
Due to the Micro PPKM, certain tourism, recreational, and social activities in Jakarta are also limited. Based on the most recently available Decision of the Head of Tourism and Creative Economy Office of DKI Jakarta No. 343 of 2021 dated April 21, 2021 on the Extension of Micro PPKM in the Tourism Industry (“Decision No. 343”), several activities and places have certain maximum capacity, as follows:
| Maximum Capacity | Activity/Places |
| 25% | (Authorized) Wedding Reception in Hotels/Function Buildings, (Authorized) Bowling/Billiard/Surfing Places, (Authorized) Waterparks, (Authorized) Children’s Game Arena |
| 50% | Salons/Barbershops, Golf/Driving Ranges, (Authorized) Meetings/Seminars/Workshops in Hotels/Function Buildings, Recreational Parks/Tourism Areas, Museums and Galleries, Water Tourism (water sports and recreation in lakes, seas, or beaches), Gyms/Fitness Centers, Cinemas, Pools |
| Others (Max. 30 attendees) | (Authorized) Marriage Ceremonies or Other Meetings |
While the abovementioned details are applicable only in Jakarta, the Micro PPKM itself is enacted countrywide. The previous Micro PPKM order under the Minister of Home Affairs (the “Minister”) Instruction No. 11 of 2021 dated May 17, 2021, was directed to 30 provinces. Now, the Minister, under his Instruction No. 12 of 2021 dated May 31, 2021 on the Extension of the Entry into Force of the Micro PPKM and the Establishment of Posts for Covid-19 Management in Villages and Urban Villages to Manage the Spread of Covid-19, has extended this coverage to encompass the entire country (i.e., 34 provinces).
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June 8, 2021
Please contact Johanes C. Sahetapy-Engel (jsahetapyengel@aksetlaw.com) or Caleb K. N. Sitorus (csitorus@aksetlaw.com) for further information.
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The foregoing material is the property of AKSET and may not be used by any other party without prior written consent. The information herein is of general nature and should not be treated as legal advice, nor shall it be relied upon by any party for any circumstance. Specific legal advice should be sought by interested parties to address their particular circumstances.
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