The Legal 500

Legal Developments in Indonesia

• Establishment of an Evaluation Team for Contract of Work and Coal Contract of Work Adjustments

  Presidential Decree No. 3 of 2012 on the Contract of Work and Coal Contract of Work Adjustment Evaluation Team (" Decree ") has been issued on 10 January 2012 in order to establish a team that will evaluate the adjustment of Contracts of Work (CoW / Kontrak Karya ) and Coal Contacts of Work (CCoW / Perjanjian Karya Pengusahaan Pertambangan Batubara ) as required by Article 169(b) of Law No. 4 of 2009 on Mineral and Coal Mining (" Law "). The Evaluation Team will operate from 10 January 2012 until December 2013 (Part 7).        
  - Lubis Ganie Surowidjojo

• OBLIGATION TO REPORT ON DRAWDOWNS OF FOREIGN LOANS IN FOREIGN CURRENCY

  On 30 September 2011, Bank Indonesia (“BI”) issued BI Regulations concerning foreign exchange, i.e. BI Regulation No.13/20/PBI/2011 concerning Receipt of Export Proceeds in Foreign Currency and Drawdowns of Foreign Loans in Foreign Loans (“PBI 20/2011”) and BI Regulation No.13/22/PBI/2011 concerning Obligation to Report a Drawdowns of Foreign Loans in Foreign Currency (“PBI 22/2011”) both of which came into effect on 2 January 2012.
  - Hanafiah Ponggawa & Partners

• The Long Awaited Bill on Land Acquisition for Public Interest Development Has Finally Been Passed

  The Bill on Land Acquisition for Public Interest Development (" Bill ") has finally been passed by House of Representatives (DPR) on 16 December 2011, and will receive the number of a law upon Presidential signing, or at the latest within 30 days. The Bill is intended to assure that land can be acquired for the development of public interest projects while prioritizing fair, democratic and humane principles and improving on the previous regulations on land acquisition, which are widely seen as being insufficient. The Bill is a significant revision of the prior regime under Presidential Regulation No. 65 of 2006 on the Amendment of Presidential Regulation No. 35 of 2005 on Land Acquisition for Public Interest (" PR 65/2006 ").        
  - Lubis Ganie Surowidjojo

• Revision of REDD+ Deforestation Moratorium 1:250,000 Reference Maps

  6 months after the issuance of Ministry of Forestry Decree No. 323/Menhut-II/2011 on the Determination of Indicative Maps Concerning the Suspension of New Permits for Utilization of Forests, Use of Forest Areas and Change of Forest Area Usage and Other Usage Areas (" Decree "), Ministry of Forestry Decree No. SK.7416/Menhut-VII/IPSDH/2011 on the Determination of Indicative Maps Concerning the Suspension of New Permits for Utilization of Forests, Use of Forest Areas and Change of Forest Area Usage and Other Usage Areas (Revision I) was issued on 22 November 2011 (" Revised Decree "). The issuance of Revised Decree is mandated by Presidential Instruction No. 10 of 2011, which obliged the Minister of Forestry ("Minister") to revise the maps covering the entire territory of Indonesia setting out areas of suspension of new permit issuance ("Indicative Maps") in every 6 months. 
  - Lubis Ganie Surowidjojo

• The New Apartment Law

  Law No. 20 of 2011 on Apartments was issued on 10 November 2011 ("Law 20/2011") and revoked the previous law on the same subject matter ("Law 16/1985"), which was considered to no longer be in line with the current conditions. 
  - Lubis Ganie Surowidjojo

• Revision of Bapepam-LK Rule IX.E.2 on Material Transactions and Changes in Core Business

  Capital Market and Financial Institutions Supervisory Agency (Bapepam-LK) Rule IX.E.2 on Material Transactions and Changes in Core Business has been amended by the Chairman of Bapepam-LK Decree No. KEP-614/BL/2011 ("Decree"). The amendment has been in force since 28 November 2011, and has repealed Chairman of Bapepam-LK Decree No. KEP-413/BL/2009 on the same subject matter. The amendment adds exemptions to the disclosure rules for debt, creates a disclosure obligation for changes in the business of certain subsidiaries, and sets a deadline for reporting the completion of the transaction.
  - Lubis Ganie Surowidjojo

• EXPATRIATES WORKING IN INDONESIA: ARE THEY PERMANENT OR FIXED TERM EMPLOYEES?

  In Indonesia, despite it being generally accepted that a foreign employee is by nature a fixed term employee, recent rulings of the Industrial Relations Court or the Supreme Court have given rise to some arguments among scholars, legal practitioners and jurists since the rulings have recognized foreign employees as ‘permanent’ employees and therefore entitled to severance pay upon termination of their employment in Indonesia.
  - Makarim & Taira S.

• ASEAN – Australia – New Zealand Free Trade Agreement (AANZFTA) to Enter Into Force for Indonesia

  On 11 November 2011 Indonesia notified its prior ratification, by means of Presidential Regulation No. 26 of 2011 ("Regulation"), of the ASEAN - Australia - New Zealand Free Trade Agreement ("AANZFTA" / "Agreement"). This means that the Agreement will enter into force for Indonesia on 10 January 2012. The original English version of the Agreement is included as part of the Regulation's appendix along with an Indonesian translation, whereby the original English language version of the Agreement will prevail should there be a difference in interpretation. 
  - Lubis Ganie Surowidjojo

• Amendment of KPPU Guidelines on Notification of Mergers, Consolidations and Acquisitions (Article 29

  Commission for the Supervision of Business Competition ("KPPU") Regulation No. 10 of 2011 on Guidelines for Completing Mergers, Consolidations or Acquisitions that Might Result in Monopolistic Practices and Unfair Competition ("Regulation") has been issued as an implementation of Article 29 (1) of Law No. 5 of 1999 on the Prohibition on Monopolistic Practices and Unfair Business Competition. The Regulation effectively replaces Regulation No. 13 of 2010 with the intention of improving the efficiency of corporate restructuring notification procedures. The Regulation has been in force since 21 September 2011.
  - Lubis Ganie Surowidjojo

• KPPU Guidelines on Monopolistic Practices (Article 17)

  Commission for the Supervision of Business Competition ("KPPU") Regulation No. 11 of 2011 ("Regulation") has been issued to provide guidelines for the implementation of Article 17 (Monopolistic Practices) of Law No. 5 of 1999 on the Prohibition of Monopolistic Practices and Unfair Business Competition. The Regulation has been in force since 28 September 2011.
  - Lubis Ganie Surowidjojo