M&A Transactions In Indonesia – Primary Regulators

Depending on the sector in which the target company is engaged, any change of shareholding composition resulting from either a merger or acquisition must be approved or acknowledged by the Indonesian Ministry of Law and Human Rights. The ministry is the department that oversees all limited lia­bility companies, no matter the sector, non-public or public alike.

If a foreign party wishes to acquire shares in an Indonesian company, generally, for most industries, an approval from the Investment Coordinating Board (Badan Koordinasi Penanaman Modal, or BKPM) is required. Other industries, especially if they are heavily regulated, eg, banking, finance, and telecommunications, are under specific government agencies, such as the Financial Services Authority (Otoritas Jasa Keuangan, or OJK), Bank Indonesia or the Ministry of Communication and Informatics.