Legal Market Overview
Indonesia’s ascendancy on the global stage continues in 2022 with its presidency of the G-20 and better than expected economic growth in Q2, fuelled, in part, by the rising price of commodities internationally and by an increase in household consumption, as well as the lifting of COVID-19 restrictions. The increase in activity in the healthcare sector due to the pandemic saw a rise in healthcare-related legal work and both foreign and domestic firms have sought to capitalise on this.
The fintech sector in Indonesia continues its upward trend, particularly in the digital banking arena, which received a boost in 2021 with new regulations allowing near full foreign ownership of local banking service providers. This reduction in red tape has led to several M&A transactions, including PT FinAccel Teknologi’s acquisition of a majority stake in PT Bank Bisnis Internasional, Tbk. in April 2022.
The competition regulator has been increasingly active, and competition matters have entered the legal mainstream, particularly in relation to merger control. In the real estate sector, foreign investors have been reconsidering their postponement of investment into residential properties, leading to steady growth. Infrastructure also remains a very active space for investors, particularly in relation to telecoms, as the country looks to unlock its productive potential by improving access to the internet and increasing bandwidth. Currently, most of the population accesses the internet through mobile devices and only around 26 percent of homes have access to fixed broadband; the government is focusing on developing telecoms infrastructure as a prerequisite for digital acceleration and this is seen as a major stepping stone for growth GDP growth and development in the country.
Indonesia’s legal market is closed and as such, international firms must affiliate with local firms on the ground in the country. Key tie-ups include Ginting & Reksodiputro in association with Allen & Overy, Hadiputranto, Hadinoto & Partners, a member firm of Baker McKenzie, Hiswara Bunjamin & Tandjung in association with Herbert Smith Freehills, Witara Cakra Advocates (WCA) in exclusive association with White & Case LLP Indonesia, Oentoeng Suria & Partners in association with Ashurst, TNB & Partners in association with Norton Rose Fulbright, which works in association with Norton Rose Fulbright, and Widyawan & Partners, which is formally associated with Linklaters.
High-profile, independent local firms include SSEK Law Firm, ABNR Counsellors at Law, and Soemadipradja & Taher. Assegaf Hamzah & Partners is another key player in the market; they are affiliated with the Singaporean firm Rajah & Tann Singapore LLP.