Indonesia to Reform Investment and Import Procedure

In implementing the economic policies package issued early last month, a number of actions have been taken by government institutions; of particular interest are those made by the Minister of Trade (“MOT”) and Indonesia Investment Coordinating Board (Badan Koordinasi Penanaman Modal – “BKPM”).

New Importer Identification Number Regulation

The Ministry of Trade has announced[1] that a total of 32 MOT regulations are due to be effected, all of which essentially aim to provide simpler trade procedures and licensing. Out of the said 32 MOT regulations, 9 have been recently issued but are still not publicly available to date.

One instrument of particular interest is Minister of Trade Regulation No. 70/M-DAG/PER/9/2015 regarding Importer Identification Number. According to various news sources,[2] the most notable change is that an Importer Identification Number (Angka Pengenal Importir – “API”) will be able to import any type of goods from multiple classifications.

Compared to the current framework under Minister of Trade Regulation No. 27/M-DAG/PER/5/2012 regarding Provisions on Importer Identification Number, as lastly amended by Minister of Trade Regulation No. 84/M-DAG/PER/12/2012 (“Previous API Regulation”), a company can only import goods under one classification from those listed in Appendix I. As an example, an importer with an API for mineral products is prohibited from importing textiles or art products and antiques.[3]

Draft Investment Procedures and Facilities Regulation in Circulation

The BKPM has been busy in drafting 2 new regulations on investment procedures and facilities respectively. Under the current framework, both investment procedures and facilities are regulated under Head of Indonesia Investment Coordinating Board Regulation No. 5 of 2013 regarding Investment Permits and Non-Permits Guidelines and Procedures, as amended by Head of Indonesia Investment Coordinating Board Regulation No. 12 of 2013.

According to various sources,[4] the new upcoming regulation on investment procedures will focus on streamlining the process of sectoral business licenses with investment licenses handled by the BKPM. In addition, the new investment procedure regulation will better facilitate a number of documentation already handled by the BKPM, such as API, Plan for Foreign Worker Employment (Rencana Penggunaan Tenaga Kerja Asing – “RPTKA”), Foreign Worker Employment Permit (Izin Mempekerjakan Tenaga Kerja Asing – “IMTA”), and visa recommendations.

In regard to the new investment facilities regulation, a number of new provisions will be introduced, including import duty waivers for imports of industrial machinery and goods and capital goods in the electricity industry. Import duty reductions and waivers of import duties and value-added tax will also be provided for imports of goods by mining concession holders.

 


FOOTNOTES

[1]9 Permendag Baru Diterbitkan, Mendag: Jaga Kepercayaan Investor,” Ministry of Trade of the Republic of Indonesia, 1 October 2015

[2] Sentana News, “Paket Kebijakan Kemendag Permudah Importir,” 30 September 2015; Bisnis Indonesia, “Perizinan Dipangkas, Satu API Bisa Impor Apa Saja,” 30 September 2015

[3] Previous API Regulation, Art. 4 (2) and (5)

[4] Kompas, “Respons Paket Kebijakan, BKPM Siapkan Dua Aturan Baru,” September 11, 2015; Republika, “BKPM Susun Aturan Pelayanan Perizinan-Fasilitas Penanaman Modal,” 11 September 2015


DISCLAIMER

The information contained in this website is for general information purposes only, and is not intended to be taken as legal advice or opinion or replace a formal consultation with a legal counsel.

The views and opinions expressed in this website, unless expressly stated otherwise, are my own and written by me. They do not represent the views or opinions of my current workplace nor any other parties that I may have connections with.

The information contained in this website is compiled from various reliable sources. However, despite best intentions to keep the information updated and correct, I do not make any representations or warranties of any kind whatsoever, express or implied, regarding the completeness, accuracy, reliability, suitability or availability with respect to the website or the information, products, services, or related graphics contained on the website for any purpose. Any reliance you place on such information is therefore strictly at your own risk.

In no event will I be liable for any loss or damage including without limitation, indirect or consequential loss or damage, or any loss or damage whatsoever arising from loss of data or profits arising out of, or in connection with, the use of this website.

Through this website you are able to link to other websites which are not under my control, whether with respect to their nature, content or availability. The inclusion of any links does not necessarily imply a recommendation or endorse the views expressed within them.

Every effort is made to keep the website online and running smoothly. However, I shall not be responsible or liable for the website being temporarily unavailable due to technical issues beyond my control.


 

Leave a Reply

Your email address will not be published. Required fields are marked *