Omnibus Law Finally Passed
On October 5, 2020, the House of Representatives finally passed the long-awaited Job Creation Law or what is publicly known as the Omnibus Law, amidst controversies during the drafting process.
At the time this newsflash is issued, this Job Creation Law is still undergoing final redactional review and promulgation process with the State Secretary. The public has yet to obtain the final version of the Law at this moment. The discussion of this newsflash is based on the final draft of the Job Creation Bill circulated publicly on October 5, 2020. We expect some changes in the Law is enacted, but no substantial changes should be made to the Law.
In total, based on this latest draft, the Omnibus Law amends 76 existing laws. Among the numerous amended laws, some of the most notable amendments are laws on capital investment, limited liability companies, and manpower. The complete list of the amended laws may be found in the following link.
In addition to the amendment of laws, the Omnibus Law stipulates segmentation for licensing based on the risk profiles of business activities. This is intended to simplify licensing the process and doing business in Indonesia, including the institutionalization of micro and small enterprises.
Further, in relation to taxation matters, Government of Indonesia originally intended to pass a separate “omnibus law” on taxation. However, this newly-enacted Job Creation Law already includes amendments on taxation laws (i.e., the Law on General Provisions of Taxation, the Law on Income Taxes, and the Law on Value Added Taxes and Sales Taxes for Luxury Goods). It remains to be seen whether the omnibus law on taxation will still be discussed and passed separately by the House of Representatives.
Please find below the key provisions in the Omnibus Law. We will issue a series of newsflashes with in-depth discussion on each of these items.
- Risk-based Business Licensing
The Omnibus Law introduces a new segmentation of business licensing based on risk profiles of the business namely: low, medium, or high risks. The risks are determined based on an evaluation of the health, safety, environment, resources utilization and management, and volatility of the businesses.
Based on the risk profiles of the businesses, the documents required for the relevant business are as follows.
| Risk | Business Licensing Document |
| Low | A Business Identification Number (Nomor Induk Berusaha or “NIB”) |
| Medium-low | a. An NIB; and
b. A Statement of certification standard by the business actor. |
| Medium-high | a. An NIB; and
b. Fulfillment of certification standards. |
| High | a. An NIB; and
b. A License. |
We expect the implementation of this risk-based business licensing to be incorporated in the Online Single Submission (“OSS”) system.
- Transitional Clauses
In light of the issuance of this Omnibus Law, existing Business Licenses will still be valid until the end of their validity period, and any issued Business License may be adjusted in accordance with the Omnibus Law.
Under the Omnibus Law, the implementing regulations should be issued in three months from the date of the Law’s promulgation. Existing implementing regulations will still be valid as long as the provisions therein do not contradict those of the Omnibus Law, and they shall be conformed within three months.
- Amendments of Capital Investment Law
The Omnibus Law amends the Capital Investment Law to include specific business lines that are closed for capital investment. Other than these closed business lines and activities that may only be carried out by the Central Government, all business lines are open for investment. We expect the new negative list of investment to be issued in the near future following the enactment of the Omnibus Law.
- Amendments of Company Law
Under the amendment of the Company Law in the Omnibus Law, there is no longer a minimum requirement for the authorized capital. The amount of the authorized capital shall be agreed upon by the founders of the company and 25% of such authorized capital shall be issued to and paid-up by the shareholders.
It is important to note that under the current BKPM regulations, foreign investment companies are still required to have the issued and paid-up capital of at least Rp2.5 billion.
Another new concept introduced under the Omnibus Law is the simplification of the company establishment for micro and small businesses. Micro and small companies may be established by a sole shareholder pursuant to an establishment statement. With this provision, micro and small businesses may be institutionalized with more lenient requirements, thus creating a separation of liability between the company and the individual owner.
- Amendments of Manpower Law
The Omnibus Law amends various provisions under the Manpower Law, among them are treatment on terms of fixed-term employment agreement, outsourcing rules, and employment termination benefits.
The amendments of the Manpower Law under the Omnibus Law no longer stipulate the maximum period of a fixed-term employment agreement, although the Omnibus Law still states that fixed-term employment agreements shall not be entered into for works that are permanent in nature. Further provisions on fixed-term employment agreements will be stipulated under a Government Regulation.
The amendments to the Manpower Law remove subcontracting from the Manpower Law, and do not set out the types of works that may be outsourced to outsourcing companies, while still acknowledging outsourcing arrangement itself. However, because the Minister of Manpower Regulations currently in effect still contain the said conditions (e.g., that outsourcing may only be for supporting activities separate from main business activities), it is unclear whether these conditions will be considered a contradiction that will require an adjustment to conform with the Omnibus Law. Therefore, it remains to be seen whether the Minister of Manpower will issue new regulations on outsourcing due to changes in outsourcing rules in the Omnibus Law.
Other notable amendments under the Manpower Law are changes on employment termination benefits. Under the Omnibus Law, there is no longer multiplier for termination benefits in relation to termination of employment under specific circumstances (e.g., in the event of efficiency or merger of companies). We understand that these changes are what causes the most controversies and objection from labor workforce, since these have greatly reduced their employment termination entitlements in cases of mergers, efficiencies, or death.
- What to Expect
Despite its intention to ease licensing process and doing business in Indonesia, various matters under the Omnibus Law still remain to be further stipulated to ascertain that these ideas work for all stakeholders across the board.
***
October 7, 2020
Copyright © 2020 AKSET. All rights reserved.
Omnibus Law Finally Passed
DKI Jakarta Extends PSBB for Two Weeks
On September 11, 2020, the Governor of DKI Jakarta re-imposed the Large-Scale Social Restrictions Activities (Pembatasan Sosial Berskala Besar or “PSBB”) through the Governor Decree No. 959 of 2020 on the Entry into Force of Large-Scale Social Restrictions in the Management of the Corona Virus Disease (Covid-19) in the DKI Jakarta Province (the “Decree”), which initially is effective only until September 27, 2020. However, the Decree stipulates that the PSBB measure may be extended in the event that new cases of Covid-19 keep significantly increasing.
On September 24, 2020, the Governor of DKI Jakarta announced that the PSBB policy will be extended to avoid potential escalation in Covid-19 cases. Therefore, as governed under the Decree, the PSBB policy will continue from September 28, 2020 until October 11, 2020.
Similar to the initial PSBB, in implementing this PSBB extension, the DKI Jakarta Government refers to the Governor of DKI Jakarta Regulation No. 33 of 2020 dated April 9, 2020 regarding the Implementation of Large-Scale Social Restrictions in the Management of the Corona Virus Disease (Covid-19) in the DKI Jakarta Province as amended by the Governor of DKI Jakarta Regulation No. 88 of 2020 dated September 11, 2020 (collectively referred to as the “Regulation”).
In essence, the Regulation governs the following key provisions:
- Religious Activities at Places of Worship
For religious activities carried out at places of worship, the maximum attendance shall be 50% (fifty percent) of the full capacity.
- Workplaces
‘Non-essential’ workplaces must be limited to no more than 25% (twenty five percent) of the full capacity. If an employee gets infected with the Covid-19, all activities at the workplace must be discontinued for at least 3 x 24 hours.
- People Movement Using Public and/or Private Transportation
All mass public transportations are limited to the maximum capacity of 50% (fifty percent) of the full capacity.
In addition to the above, the Governor of DKI Jakarta issued Decree No. 979 of 2020 dated September 22, 2020 on Controlled Isolation Places owned by the DKI Jakarta Province as Management of the Corona Virus Disease (Covid-19) (“Decree 979/2020”). In Decree 979/2020, the Governor of DKI Jakarta declares i) the Jakarta Islamic Centre, ii) Graha Wisata Taman Mini Indonesia Indah, and iii) Graha Wisata Ragunan as controlled isolation places for those who contracted Covid-19 in DKI Jakarta.
Given that DKI Jakarta has new Covid-19 cases every day and even is predicted to reach 20,000 active cases in early November, there is a high possibility that the PSBB policy may be extended again. We will continue to monitor the development closely.
***
September 25, 2020
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Minister of Manpower Issues Guidelines for Business Continuity Plans
In light of the COVID-19 pandemic, on September 18, 2020, the Minister of Manpower (the “MOM”) issued her Decree No. 312 of 2020 on the Guidelines for the Drafting of Business Continuity Plans (the “BCP”) in Facing a Disease Pandemic (the “MOM Decree”). The MOM Decree is intended to provide guidance for companies to prepare their BCPs to protect their business continuation from the impact of the pandemic and to prevent the spread of the virus in their companies. Companies are expected to prepare the BCP tailored to their specific businesses.
As the MOM Decree is a guidance, there is no sanction if a company does not have a BCP. There is no obligation for companies to submit their BCPs to any governmental authority. However, companies are encouraged to involve the labor unions and coordinate with the Labor Inspector (Pengawas Ketenagakerjaan) in preparing the BCP.
Under the MOM Decree, there are seven stages in preparing a BCP, i.e.:
- recognizing business priorities;
- identifying the pandemic risks;
- planning the mitigation for the pandemic risks;
- identifying the response to the impact of the pandemic;
- designing and implementing the BCP;
- communicating the BCP; and
- testing the BCP.
We will briefly discuss the BCP preparation stages below.
- Recognizing Business Priorities
In recognizing its business priority, a company shall first determine its main products/services. The company shall then identify the core business activities that must be conducted to produce such main products or to provide the main services. This step includes identifying the manpower required for the business activities and, in case of their absence, whether they can be replaced or filled in by other employees.
- Identifying Pandemic Risks
Following the first step, the company shall identify the risks of the pandemic for the identified components. The company shall map scenarios of possible threats, both internal and external, that may disrupt the business continuity. These identified threats shall be scored based on their probability and severity (e.g., from scale of 1 to 5).
The company shall also map vulnerability points in each identified scenario, for example, vulnerability in manpower, material, facility, and finance. Subsequently, the company shall analyze its capability in controlling each threat, according to their level of priority.
- Planning Mitigation for Pandemic Risks
In preparing the mitigation plan for the pandemic, a company shall consider preparing standard operational procedures (the “SOP”), implementing flexible work, securing the supply chain, preparing a communication team, reassess labor policy (such as policy on business travel, overtime, etc.), and occupational health and safety.
In planning the mitigation, the company shall determine the level of an acceptable risk for each threat, planning the actions required to mitigate such risk, set out a schedule for the action plan, determine resources needed to carry out the actions, and appoint the relevant personnel for each action.
- Identifying the Response to Impact of Pandemic
The company shall first identify the events that will trigger the response, the target response, the responding action based on the mitigation plan and the SOP, the required resources, and the person in charge.
- Preparing and Implementing BCPs
Based on the information identified at the previous stages, the company shall prepare the BCP in a matrix. A designated team may be formed specifically for the preparation of the BCP. It is also suggested that employees be involved in the preparation of the BCP and that the BCP sets out clear definition of the management’s and the employees’ responsibilities.
- Communicating BCPs
After the BCP is stipulated, it shall be communicated internally (to all employees and management) and externally (to customers, suppliers, etc.).
- Testing BCPs
The BCP may be tested in the form of simulation, drills, etc. The testing may be done periodically to keep the BCP updated on new issues that may occur from time to time.
***
September 24, 2020
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Covid-19 Prevention and Control Protocols for Offices in Jakarta
Approximately 5 months after the Covid-19 outbreak in Jakarta, the Head of the Service Office of Manpower, Transmigration, and Energy of Jakarta Province Agency (“Head of Manpower Agency”) enacted Decree No. 1986 of 2020 dated August 28, 2020 on Covid-19 Prevention and Control Protocols in Private Offices, State Owned Enterprises, Regional Owned Enterprises, and Places of Work (the “Decree”). The Decree implements Article 8(9) of Governor of Jakarta Regulation No. 79 of 2020 dated August 19, 2020 on the Disciplinary and Law Enforcement Implementation of Health Protocols as Prevention and Containment Efforts of the Corona Virus Disease 2019 (the “Governor Regulation”).
- Covid-19 Prevention and Control Protocols
Pursuant to the Decree, the Covid-19 prevention and control protocols (collectively, the “Protocol”) in private offices, state owned enterprises, regional owned enterprises, and places of work shall be carried out by these following measures:
- To form of a Covid-19 Handling Team which consists of the leader of the Company, the representatives of the employees, the work safety and health officer, the medical personnel, and the security guard by making a Statement Letter issued by the head of the Company (the “Handling Team”);
- The Handling Team shall make reports in writing through bit.ly/covid19perusahaan directed to the Manpower Agency if there is an employee that has a close contact with a Covid-19 patient, became a suspect of Covid-19, a probable of Covid-19, a confirmed patient of Covid-19, or recently returned from travel;
- To limit the number of people present at the same working place at the same time by no more than 50% of the regular capacity;
- To require each employee and visitor to wear a mask and any other self-protection equipment as necessary (i.e., hand gloves and/or face shields);
- To clean and disinfect the office space periodically using the proper cleaner and disinfectant;
- To measure the body temperature of each person who enters the work place;
- To provide a separate room to observe an employee with the Covid-19 symptoms;
- To provide the hand sanitizer at each entrance and in each room;
- To provide hand washing facilities;
- Not to terminate the employment of any employee who is undergoing self isolation and continue to provide the basic rights to such employee;
- To conduct periodic health assessments to all employees to ensure that they are infected by the Covid-19 and to require visitors to complete the Self-Assessment Form;
- To apply a physical distancing of at least 1 (one) meter;
- To arrange the utilization of the employees facilities to avoid large gatherings (i.e., the elevators, praying facility, canteens, sports facilities, etc.);
- To maximize the use of technology in carrying out work activities;
- The Handling Team shall supervise the health of the employees proactively;
- To impose sanctions on employees that do not implement the Protocol;
- To encourage employees to use personal transportation;
- To provide supporting facilities for employees who use a bicycle to work; and
- To suspending the company’s activity for cleaning and disinfecting for 3x24 hours if an employee and/or a member of society in the company is confirmed positive of the Covid-19.
- Sanctions
Based on Article 8(5) of the Governor Regulation, any violation of the Protocol by the employer, a manager, an operator, or a person in charge of any office, work place, business place, industrial site, hotel or any other similar accommodation or tourist attraction, shall be imposed with administration sanctions in the form of temporary closing for up to 3x24 hours. Further, if such person repeats the violation of the Protocol, then such person may subject to the following penalties:
- First repetition, Rp50,000,000 (fifty million Rupiah) penalty;
- Second repetition, Rp100,000,000 (one hundred million Rupiah) penalty;
- Third repetition, Rp150,000,000 (one hundred fifty million Rupiah).
The sanction imposition shall be carried out by Satpol PP, the Manpower Agency, the Tourism and Creative Economy Agency, the Industry, Trade, Cooperation, Small and Mid-Sized Enterprises Agency. These Agencies may be accompanied by regional authorities, police and/or military force.
As of today, there a number of companies were temporarily closed by the Governor of Jakarta due to the violation of the Protocol.
- Reporting Obligation
Other than the reporting obligation stated on point (b) above, a company must submit a report on the implementation of the Protocol through bit.ly/bekerja-kembali which consists of, among others, the check list of whether or not each item of the Protocol is completed.
***
September 15, 2020
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DKI Jakarta Re-Imposes Stricted PSBB After Record Of COVID-19 Infections Rise In Cases; Health Protocols In Workplaces
Since June 2020, DKI Jakarta has implemented the transitional phases of the implementation of Large-Scale Social Restrictions Pembatasan Sosial Berskala Besar – THE “PSBB”) by easing the restrictions put in place under the PSBB and allowing certain activities to resume in order to maintain the productive socio-economic activities.
However, the Governor of DKI Jakarta decides to discontinue the transitional phases of the PSBB and re-impose the stricter PSBB. This decision is taken in order to reduce the spread of the Corona Virus Disease (Covid-19) as the infection cases in DKI Jakarta continue to surge. Under the Governor Decree No. 959 of 2020 dated September 11, 2020 on the Entry into Force of Large-Scale Social Restrictions in the Management of the Corona Virus Disease (Covid-19) in the DKI Jakarta Province, the stricter PSBB measures are effective as of September 14, 2020 until September 27, 2020 and may be further extended if necessary.
Unlike the transitional PSBB, the Governor of DKI Jakarta sets out the restrictions of the PSBB in DKI Jakarta the Governor Regulation No. 88 of 2020 regarding Amendments of Regulation No. 33 of 2020 on Implementation of Large-Scale Social Restrictions in the Management of the Corona Virus Disease (Covid-19) in the DKI Jakarta Province (the “Regulation”).
In addition, the implementation of the PSBB under the Regulation refers to Governor of DKI Jakarta Regulation No. 79 of 2020 dated August 19, 2020 on the Implementation of Discipline and law Enforcement of Health Protocols as Endeavor of Prevention and Control of Covid-19 (the “Protocols”).
We set out below the key provisions of the amendments on the implementation of the PSBB based on the Regulation.
- ‘Non-Essential’ Businesses to Limit Workplaces at 25% Capacity
All “non-essential” businesses are required to temporarily limit their activities at the workplaces. This limitation is conducted by implementing mechanism to work from home for the employees. If the work from home mechanism cannot be conducted, the businesses shall limit the number of people who are at workplaces at any time to be not more than 25% (twenty five percent) of the total number of the people at workplaces.
- ‘Essential’ Businesses May Operate with Certain Restrictions
The Regulation stipulates certain “essential” businesses which are exempted from the PSBB, as follows:
- foreign country representative offices and/or international organizations carrying out diplomatic functions;
- state/regional-owned enterprises participating in the handling of Covid-19 and/or fulfillment of basic needs;
- workplaces in the following sectors:
- health;
- food/beverage;
- energy;
- communication and information technology;
- finance;
- logistics;
- hospitality/hotel activities;
- construction;
- strategic industries;
- basic services, public utilities and industries which are deemed certain vital national objects; and/or
- daily needs.
- local and international non-governmental organizations that engage in the disaster reliefs and/or social sectors.
The exempted businesses above are still subject to the Protocols (which are briefly discussed below).
- Health Protocols at Workplaces for ‘Non-Essential’ Businesses
In general, the ‘non-essential’ businesses shall implement the following measures in conducting the activities at workplaces:
- To establish the mechanism to work from home to all employees;
- To maintain that the service provided and/or business activities are still ongoing on limited basis;
- To maintain the productivity of the employees;
- To carry out the prevention measures of Covid-19 transmission in the workplaces, such as ensuring the workplaces areas are clean, conducting periodic cleaning, using cleansers and disinfectants, and closing access for any unauthorized person;
- To suspend the activities at the workplaces for at least 3x24 hours if there is any employee who is infected by the Covid-19;
- To maintain the safety at or around the workplace; and
- To provide assistance for any employee who is infected by Covid-19 as per the applicable regulations.
- Health Protocols at Workplaces for ‘Essential’ and ‘Non-Essential’ Businesses
Both ‘essential’ and ‘non-essential’ businesses shall comply with the Protocols, including the following:
- To establish an internal Covid-19 task force at workplaces which consists of the management, HRD department, Occupational Health and Safety (OHS) department, and health officers by issuing a decision of such establishment by the businesses;
- To monitor and update the development of information of Covid-19 in the workplaces and report in writing to the Government of DKI Jakarta through the established Covid-19 task force (as referred in point 1 above);
- To limit the number of people who are at workplaces at any time to be not more than 50% (fifty percent) of the total number of the people at workplaces (except for the ‘non-essential’ businesses, the limit is 25% capacity);
- To require employees to wear masks;
- To ensure the entire working area is clean and hygiene by conducting perioding cleaning using cleaner and disinfectant;
- To perform a body temperature check before entering the workplaces;
- To provide hand sanitizer;
- To provide facilities for hand washing with running water and soap;
- To not terminate the employment of an employee who undergoes self-isolation/self-quarantine due to Covid-19;
- To ensure that employees who come for work are not infected by the Covid-19;
- To ensure the physical distancing with a minimum distance of 1 (one) meter between persons in every work activity;
- To avoid work activities which may cause a crowd;
- To proactively conduct employees’ health monitoring;
- To implement the Covid-19 prevention protocols;
- To impose a sanction on employees who do not implement Covid-19 prevention protocols;
- To publish the Covid-19 prevention protocols.
Our previous workplaces guidance set out in our Newsflash (please check: https://aksetlaw.com/news-event/covid19/workplaces-guidance/) remain effective unless changed in the above.
***
September 14, 2020
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Bank Indonesia Loosens the Mandatory Fulfilment of Giro Reserve Requirements in Rupiah
On May 1, 2020, Bank Indonesia amended the provisions of mandatory fulfilment of Giro Reserve Requirements (Giro Wajib Minimum — the “GWM”) in Rupiah for Conventional Commercial Banks (Bank Umum Konvesional — collectively, “BUK”), Sharia Commercial Banks (Bank Umum Syariah — collectively, “BUS”) and Sharia Business Units (Unit Usaha Syariah — collectively, “UUS”) by enacting the Members of the Board of Governors of Bank Indonesia Regulation Number 22/10/PADG/2020 on Giro Reserve Requirements in Rupiah and Foreign Exchange for Conventional Commercial Banks, Sharia Commercial Banks, and Sharia Business Units effective on May 1, 2020 (“PADG 22/2020”). PADG 22/2020 is the fifth amendment of the initial Members of the Board of Governors of Bank Indonesia Regulation Number 20/10/PADG/2018. PADG 22/2020 entered into force as of May 1, 2020.
PADG 22/2020 is an implementing regulation of Bank Indonesia Regulation Number 22/3/PBI/2018 dated July 16, 2018 on Giro Reserve Requirements in Rupiah and Foreign Exchange for Conventional Commercial Banks, Sharia Commercial Banks, and Sharia Business Units as lastly amended by Bank Indonesia Regulation Number 22/10/PBI/2018 dated October 1, 2018.
The issuance of PADG 22/2020 is Bank Indonesia’s effort to constantly maintain and increase the availability of Rupiah liquidity in conventional and sharia banking from the impact of domestic economic growth slowdown.
Under PADG 22/2020, Bank Indonesia loosens the mandatory fulfilment of the GWM amount in Rupiah for BUK, BUS and UUS. PADG 22/2020 also amends provisions which, among others, loosen the requirement for BUK to be eligible in obtaining giro services from Bank Indonesia, provide an adjustment of the calculation that reflects the change of the mandatory fulfilment of GWM for BUK, BUS, and UUS that receives short-term liquidity loan or financing, as well as clarify the mandatory fulfilment of GWM on a daily basis for BUK and BUS performing merger and consolidation.
- LESS STRINGENT GWM REQUIREMENTS IN RUPIAH
PADG 22/2020 has lowered the GWM percentage in Rupiah at the average of 3.5% of Third-Party Fund (Dana Pihak Ketiga — “DPK”) in a BUK in Rupiah during a particular report period. Previously the requirement was at the average of 5.5% of DPK in a BUK. The calculation of the foregoing GWM shall be fulfilled at 0.5% on a daily basis. This is a more lenient specification from the previous 2.5% daily requirement based on balance sheet of a BUK’s clearing account in Rupiah at Bank Indonesia. Meanwhile, the average of calculation basis of the foregoing GWM still remain the same at 3% based on the average of balance sheet of a BUK’s clearing account in Rupiah at Bank Indonesia. Similar relaxation of GWM percentage also applies to BUS and UUS.
In connection with giro services (jasa giro), the previous regulations provide that Bank Indonesia may grant giro services for BUK every day to a particular portion of the fulfillment of obligation of GWM in Rupiah, provided that such BUK fulfills the ratio of GWM in Rupiah more than or equal to 5.5%. PADG 22/2020 lowers this requirement to be at 3.5%.
Similar with the previous regulations, BUK that receive any short-term liquidity loan and BUS that receive any short-term liquidity sharia financing are not subject to the mandatory fulfilment of GWM at an average. Such BUK and BUS are only obligated to comply with the fulfilment of GWM in Rupiah on a daily basis. However, PADG 22/2020 loosens the requirement for GWM fulfilment on a daily basis from the previous 5.5% and 4% respectively to 3.5% of the respective DPK in Rupiah.
- Clarification of GWM calculation for BUK and BUS in mergers or consolidations
PADG 22/2020 clarifies the calculation for the relaxation of daily GWM percentage in Rupiah for BUK and BUS performing merger or consolidation. The calculation for the foregoing relaxation shall be 1% on a daily basis. If the daily mandatory fulfilment of GWM in Rupiah is less than 1%, the relaxation upon daily mandatory fulfillment of GWM in Rupiah for such BUK and BUS shall be fulfilled by the surviving bank in the merger or consolidation with the percentage of the stipulated daily mandatory fulfilment of GWM, which is 0.5% of their respective DPK.
Alongside the aforementioned changes, PADG 22/2020 amends the details of the calculations as set out under Attachments I, III, V, VI, VIII, X, XI and XII of PADG 22/2020, together with a brief examples to calculate the GWM amount.
***
September 11, 2020
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Government to Grant Subsidy for Workers Affected by COVID-19
Amidst the COVID-19 pandemic, the Minister of Manpower (the “Minister”) issued the Minister Regulation No. 14 of 2020 dated August 14, 2020 on the Guidelines for the Granting of Government Support in the Form of Salary/Remuneration Subsidy for Workers/Manpower in Handling the Impact of Corona Virus Disease 2019 (COVID-19) (the “Minister Regulation”).
Based on the Minister Regulation, the Government will grant support for eligible workers, in the form of salary/remuneration subsidy (the “Social Support”), in the amount of Rp600,000 (six hundred thousand Rupiah) per month for four months. The Social Support is intended to protect, sustain, and improve workers’ economic capability during the COVID-19 pandemic.
We set out below the highlights of the Minister Regulation.
- Criteria of Eligible Workers
To be considered eligible for the Social Support, a worker must fulfill the following requirements:
- an Indonesian citizen;
- is registered as an active member of the manpower social security program of Manpower Social Security Operating Body (“BPJS Ketenagakerjaan”), evidenced with a membership card number;
- receives salary/remuneration;
- his/her BPJS Ketenagakerjaan membership is valid until June 2020;
- pays contribution based on salary/remuneration of less than Rp5,000,000 (five million Rupiah), based on the report submitted by the employer to BPJS Ketenagakerjaan; and
- owns an active bank account.
The Government will grant the Social Support based on (i) the number of eligible workers, and (ii) budget ceiling availability.
If an employer provides falsified data in relation with the workers’ salary/remuneration, such employer shall be subject to sanctions in accordance with the prevailing laws and regulations.
- Procedures for the Granting of the Social Support
The information of the Social Support recipient candidates are collected from the data of active participants of BPJS Ketenagakerjaan. Hence, workers are not required to submit any application in order to be granted the Social Support. The BPJS Ketenagakerjaan will independently conduct verification and validation of such candidates in accordance with the stipulated criteria.
Based on unofficial statement of the President Director of BPJS Ketenagakerjaan as published on the news, BPJS Ketenagakerjaan is currently validating and verifying the data of eligible workers through their bank account and BPJS Ketenagakerjaan membership.After the verification and validation is completed, BPJS Ketenagakerjaan will provide a list of recipient candidates to the Minister.
The determination of the eligible workers shall be made by the Budget User Authorizer (Kuasa Pengguna Anggaran or KPA) which refers to the official in Directorate General of Industrial Relation Development and Manpower Social Security appointed by the Minister.
The Social Support will be distributed by the State Treasury Service Office through an appointed government bank directly to the recipients’ bank account. The Social Support distribution will be carried out in phases.
If a recipient turns out to be ineligible yet already received the Social Support, then he/she must return such Social Support to the state treasury.
***
September 11, 2020
Copyright © 2020 AKSET. All rights reserved.
Government Relaxes Premia for Manpower Social Security Programs During COVID-19
As an attempt to ensure the continuity of businesses during the Covid-19 pandemic, the Government relaxes the payment of premia for the Manpower Social Security Programs with the issuance of Government Regulation No. 49 of 2020 dated August 31, 2020 on Adjustments For Premia of Manpower Social Security Programs During Non-Natural Disaster Of Corona Virus Disease 2019 (COVID-19) (“GR 49/2020”). GR 49/2020 is effective as of September 1, 2020. The salient provisions of GR 49/2020 are discussed below.
Under GR 49/2020, the relaxation is as follows:
(i) the deferment of the premium payment deadline from the 15th of a month to the 30th of the month;
(ii) 99% (ninety nine percent) deductions of the Work-Related Accident Security (Jaminan Kecelakaan Kerja — “JKK”) premium and the Death Security (Jaminan Kematian — “JKM”) premium; and
(iii) partial postponement of Pension Security (Jaminan Pensiun “JP”) premium payment.
The relaxation above is valid from August 2020 until January 2021 and is applicable for employers, non-wage recipient participants and wage recipient participants (as applicable) who have registered their Manpower Social Security programs before August 2020.
The deductions and the postponement will be granted if the JKK and JKM premia are paid until July 2020. Any person who registers after July 2020 shall pay the normal premia for the first two months and will be granted deduction on their third month premia until January 2021.
In relation to postponement of partial payment of the JP premium, 99% of the premium of an employer’s portion may be deferred to May 15, 2021. The payment of the deferred premium must be made in full by May 15, 2022. The eligibility for this postponement differs based on the size of an employer. Medium-sized and Large Enterprises (Usaha Menengah dan Besar — “UMB”) are eligible for such postponement only if their production, distribution, or main business activities are disrupted due to Covid-19 and result in a decrease in monthly sales or income turnover of more than 30% (thirty percent). The companies must have registered their employees as participants before August 2020 and the companies have made the JP premium payment until July 2020.
***
September 10, 2020
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Minister of Energy and Mineral Resources Sets Ground Rules on Battery Electric Vehicle Charging Infrastructure
Following the Government’s program to accelerate the adoption of battery based electric vehicle in Indonesia under President Regulation No. 55 of 2019 on the Acceleration of Battery Electric Vehicle (“BEV”) Program for Road Transportation issued last year, the Minister of Energy and Mineral Resources (the “MEMR”) issues the MEMR Regulation No. 13 of 2020 on the Provision of Electric Charging Infrastructure for Battery Electric Vehicle (“MEMR Regulation 13/2020”) in August 7, 2020.
The MEMR Regulation 13/2020 complements the already existing MEMR Regulations which regulates other aspects of BEV charging in Indonesia, such as the MEMR Regulation No. 35 of 2013 as lastly amended by MEMR Regulation No. 12 of 2016 which regulates the relevant permits in electricity supply and electricity supporting services business.
Notably, the MEMR Regulation 13/2020 serves as the ground rule for the provision of BEV charging infrastructure, stipulating the various types of charging infrastructure, the necessary licensing requirements and safety standards, as well as determining the tariff to be imposed for BEV charging.
- Types of Infrastructure
The MEMR Regulation 13/2020 divides BEV charging infrastructure in two types, namely: (i) battery charging facilities (also known as fasilitas pengisian ulang) and (ii) battery exchange facilities (also known as fasilitas penukaran baterai).
Battery charging facilities may take place at (i) Private Electric Installations and/or (ii) Public Electric Vehicle Charging Stations (Stasiun Pengisian Kendaraan Listrik Umum or “SPKLU”), while battery exchange facilities will take place at Public Electric Vehicle Battery Exchange Stations (Stasiun Penukaran Baterai Kendaraan Listrik Umum or “SPBKLU”).
Private Electric Installations are facilities at electricity utilization installations used for BEV charging specifically for captive use which shall not be used for commercial activities. Private Electric Installations may be located at government offices or at residential area.
Meanwhile, SPKLU and SPBKLU are BEV charging facilities and BEV battery exchange facilities used for public interest.
SPKLU and SPBKLUs shall be located at locations that are easily reachable by BEV owners, that would not disturb the security, safety, and order of traffic. Specifically for SPKLUs, the location shall be complimented with a specific designated parking area.
To accelerate the adoption of BEV, the MEMR Regulation 13/2020 also suggests SPKLU and SPBKLUs to be provided in pre-existing facilities, such as at public gas stations, shopping malls, government offices, and public parking spaces, without eliminating other potential locations for as long as the meet the accessibility and safety requirements.
MEMR Regulation 13/2020 provides a more detailed technical requirement for SPKLU(s), which includes standards of its power supply equipment, current/voltage/communication control system, also [protection] and safety system.
Meanwhile, SPBKLU(s) appear to have a less stringent requirement, focusing primarily on the guarantee of the battery being [leased], the online application provided by the operator on the battery swapping facilities and other information, and the ownership of the battery [exchanger].
Every charging and battery exchange infrastructure shall meet the stipulated electricity safety, including utilizing only certified products meeting the Indonesian national safety standards (SNI), employing certified technicians, and obtaining operation-worthiness certification in the form of Operational Feasibility Certificate (Sertifikat Laik Operasi or “SLO”).
- Licensing Requirements and Safety Standards
Depending on whether the SPKLU sources its own electricity or simply purchasing the electricity, the entity developing SPKLU will be required to obtain either an integrated Electric Provision Business License (Izin Usaha Penyediaan Tenaga Listrik Terintegrasi or “Integrated IUPTL”) or a sale IUPTL (Izin Usaha Penyediaan Tenaga Penjualan or “Sale IUPTL”), respectively.
In addition to the IUPTL, all SPKLUs developer shall also obtain determination of Business Area (Wilayah Usaha) from the MEMR and approval of their Electric Provision Business Plan (Rencana Usaha Penyediaan Tenaga Listrik or “RUPTL”). A holder of integrated IUPTL is also required to own several SPKLUs located in more than 1 (one) province nationwide.
Since at the moment, PT PLN Persero (PLN) is the only Integrated IUPTL holder, we refer the Integrated IUPTL holder as PLN in this Newsflash.
Meanwhile, Private Installation and SPBKLU operator are not required to obtain IUPTL (nor the relevant Business Area or RUPTL) to run its business.
Based on MEMR Regulation 13/2020, SPBKLU developer shall have a license in accordance with the prevailing laws and regulations.
Both SPKLU and SPBKLU must obtain SPKLU or SPBKLU Identity Number by submitting an application to the MEMR. Once issued, a SPKLU or SPBKLU shall put its Identity Number in a clearly visible location.
Any change to the SPKLU or SPBKLU’s scheme data or location shall be reported in writing to the MEMR within 5 (five) business days upon the change.
- Business Model
The MEMR Regulation 13/2020 provides possible business models in which SPKLU and SPBKLU may be run. Some business models of SPKLU involve the role of holders of Electricity Supporting Services Business License specifically for Operations (Izin Usaha Jasa Penunjang Tenaga Listrik untuk Pengoperasian or “IUJPTL”) as the operator.
There are 5 (five) possible business models in which SPKLU may be run by the holder of an Integrated IUPTL or PLN:
(i) provide/sell electricity, own, self-operated by IUPTL holder (“POSO”);
(ii) provide/sell electricity and own by IUPTL holder, but operated by the IUJPTL holder (“POPO”);
(iii) provide/sell by IUPTL holder, but owned and operated by IUJPTL holder (“PPOO”);
(iv) provide/sell and self-operated by IUPTL holder, but lease the facilities from partner (“PLSO”);
(v) provide/sell by the IUPTL holder, lease the facilities from a partner, and operated by IUJPTL holder (“PLPO”).
Meanwhile, there are other 5 (give) possible business models in which SPKLU may be run by the holder of a Sales IUJPTL:
(i) by buying electricity from IUPTL holder, sell and self-operate (also known as retail, own, self-operated or “ROSO”);
(ii) by buying electricity from Integrated IUPTL holder, sell yet privately operated by IUJPTL holder (also known as retail, own, privately-operated or “ROPO”);
(iii) by buying electricity from Integrated IUPTL holder, sell, yet owned and operated by IUJPTL holder (also known as retail, privately owned and operated or “RPOO”);
(iv) by buying electricity from Integrated IUPTL holder, sell, lease from partner yet still self operate (also known as retail, lease, self-operated or “RLSO”); and/or
(v) by buying electricity from Integrated IUPTL holder, sell, yet lease from partner and operated by IUJPTL holder (also known as retail, lease, privately operated or “RLPO”).
SPBKLUs business models are classified based on whether the SPBKLU developer owns the battery swapping cabinet. There are two possible business models in which SPBKLU may be run:
(i) battery provider, battery swapping cabinet owner (“BPCO”), and
(ii) battery provider, battery swapping cabinet lessee (“BPCL”).
- Appointment of PLN and Tariff
Same as the approach implemented under President Regulation No. 55 of 2019, as a pioneer project, the MEMR Regulation 13/2020 appoints PT PLN (Persero) (“PLN”) to implement the provision of charging infrastructure. However, PLN may also collaborate with other entities.
PLN shall also create a roadmap of SPKLU and SPBKLU installations (by coordinating with the SPKLU and SPBKLU developers) to be submitted to the MEMR within 6 (six) months from the issuance of the MEMR Regulation 13/2020 (i.e., January 2021), including the location, capacity, and the chosen business model for each SPKLU and SPBKLU.
The imposed tariff for electricity provided by PLN varies between:
(i) retail tariff imposed by Integrated IUPTL holder for Private Electric Installation for public transportation charging, SPKLU, or SPBKLU;
(ii) retail tariff imposed by Integrated IUPLT holder for Private Electric Installation for non-public transportation use; and
(iii) tariff imposed for special services being tariff for charging imposed by SPKLU developers to BEV owners.
Despite so, MEMR Regulation 13/2020 provides an additional criteria for determining electricity retail tariff being a Q factor at a minimum amount of 0.8 (point zero eight) and a maximum amount of 2 (two).
Whereas, SPKLU developer as Integrated IUPTL or Sales IUPTL holder shall use an N factor at the highest amount of 1.5 (one point five) in determining tariff to BEV owners.
On the other hand, tariff of battery exchange/battery swapping imposed by SPBKLU developer shall be based on the commercial considerations of such developer and agreement between the SPBKLU developer and the BEV owner.
- Guidance, Monitoring, and Sanctions
The MEMR will continuously provide guidance on the provision of charging infrastructure and regulation of electric power tariff for BEVs, including through socialization, dialogue, and/or focus group discussions; technical education and training; assistance in troubleshooting; and monitoring and evaluation of the provision of charging infrastructure.
The MEMR will also monitor the criteria and facilities installed , the implementation of tariff, the quality of operational services provided, and the safety standard of each charging infrastructure.
Failure to obtain and display valid SPKLU or SPBKLU Identity Number visibly and failure to report any change of data scheme or location of SPKLU or SPBKLU may result in administrative sanction. The MEMR may issue up to three written warning to such SPKLU or SPBKLU.
Failure to observe with the written warnings may result in temporary suspension of business activities for 3 (three) months. Subsequently, the MEMR may revoke the relevant business licenses of the SPKLU and SPBKLU operators if they fail to comply with the stipulated provision after the temporary suspension.
The MEMR will also impose sanction pursuant to the prevailing laws and regulations on electric power for failure to meet the stipulated safety standards.
Owners of Private Installations, SPKLU and SPBKLU that have operated before the enactment of MEMR Regulation 12/2020 shall comply and adjust its operations in accordance with the regulation. Specifically, for existing SPKLU(s) developer, adjustment shall be made at the latest 6 (six) months as of the enactment of the regulation.
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September 8, 2020
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PERADI International Seminar - Indonesia's Investment Potential
On September 3, 2020, AKSET Partners, Johannes Sahetapy-Engel and Alfa Setiawati spoke at the International Seminar discussing "Indonesia's Investment Potential." The seminar was organized by the Consulate of Indonesia at Tawau and Peradi.
Other speakers at the Seminar are from BKPM, IIPC, and Peradi Banjarbaru.
We would like to thank the Consulate of Indonesia at Tawau and Peradi for holding a special event involving our friends from Malaysia and Singapore.
