BANK INDONESIA
Updated guidelines on the implementation of the BI-RTGS System
Bank Indonesia ("BI") Members of the Board of Governors Regulation No. 23/29/PADG/2021 regarding the Fourth Amendment of BI Members of the Board of Governors Regulation No. 20/15/PADG/2018 regarding the Implementation of Instant Fund Settlement Through the Bank Indonesia-Real Time Gross Settlement ("BI-RTGS") System
Enacted and came into force on December 31, 2021
This Regulation amends the guidelines for the implementation of the BI-RTGS System, specifically, letters d and f of Article 62 and the Appendixes of BI Members of the Board of Governors Regulation No. 20/15/PADG/2018. It also adds Article 141A.
With the issuance of this Regulation, the provisions regarding: (i) the preparation of written policies and procedures relating to fraud management or risk; (ii) the handling of suspected fraud and/or incidents of fraud; (iii) the guidelines for formulating written policies and procedures for the BI-RTGS System related to monitoring and reconciliation in the implementation of fund transfer transactions through the BI-RTGS System, as well as fraud management in BI-RTGS System operations; and (iv) the scope of the implementation of the hardware security audit of the BI-RTGS System Participant, as well as the security and protection of data confidentiality, shall be applicable beginning July 1, 2022. Otherwise, the provisions of this Regulation apply beginning December 31, 2021.
CAPITAL MARKETS AND FINANCE
Threshold value for securities offerings classified as non-public offerings
Indonesian Financial Services Authority ("OJK") Regulation No. 29/POJK.04/2021 of 2021 regarding Offerings Classified as Non-Public Offerings
Enacted on December 30, 2021 and came into force on December 31, 2021
This Regulation stipulates that a securities offering shall be classified as a non-public offering if the overall offering has a maximum value of five billion rupiah and is conducted in one or several offerings within a maximum period of 12 months. However, the OJK can stipulate a different threshold value for securities offerings (i) conducted by supranational agencies; (ii) of equity by foreign companies listed on the stock exchange or public companies that are addressed to employees, members of the board of directors and/or board of commissioners of companies and/or controlled companies; (iii) for market deepening; and/or (iv) in support of government policies.
This Regulation revokes OJK Regulation No. 26/POJK.04/2020 of 2020 regarding Offerings Classified as Non-Public Offerings.
Requirements and procedures for e-GMS providers
OJK Circular Letter No. 1/SEOJK.04/2022 regarding the Procedure to Apply to Be a System Provider for Electronic General Meeting of Shareholders ("e-GMS")
Enacted and came into force on January 24, 2022
This Circular Letter sets the requirements and procedures to apply for approval as an e-GMS system provider for all parties other than the Depository and Settlement Institution. This is an implementing regulation for the reference to "other parties approved by the Financial Services Authority (as an e-GMS Provider)" in Article 34(1) of OJK Regulation No. 15/POJK.04/2020 regarding the Planning and Organization of a General Meeting of Shareholders of Public Companies and Article 4(2)(b) of OJK Regulation No. 16/POJK.04/2020 regarding the Implementation of Electronic General Meeting of Shareholders of Public Companies.
Consumer protection in the non-bank finance industry
OJK Press Release No. SP 05/DHMS/OJK/I/2022 regarding Improving Consumer Protection in IKNB, OJK Issues Provisions for Completing PAYDI and Fintech Lending
Issued January 28, 2022
The OJK reported that it will soon issue two regulations in the non-bank finance industry ("IKNB") in connection with insurance products associated with investments (Produk Asuransi Yang Dikaitkan dengan Investasi or "PAYDI"), or unit link products, and the amendment of the regulation regarding fintech peer-to-peer ("P2P") lending services. It said these regulations were being issued to improve consumer protection and the operation of the insurance and P2P lending sectors.
The PAYDI-related regulation will cover product specifications, corporate requirements to sell PAYDI, marketing practices, product transparency and investment management. The amendment to the fintech P2P lending services regulation will cover the ownership of joint funding service platforms, form of legal entities, establishment capital, equity value, maximum funding limit, controlling shareholders, and consumer protection prohibitions.
Termination of stock option contract trading through the JOTS
PT Bursa Efek Indonesia Board of Directors Decree No. KEP-00005/BEI/01-2022 regarding the Revocation of Exchange Arrangements Related to Stock Option Contract Trading (Kontrak Opsi Saham or "KOS") and Termination of Jakarta Option Trading System ("JOTS") Services
Enacted and came into force on January 31, 2022
This Decree terminates KOS conducted through JOTS and JOTS services. With the issuance of this Decree, several previous regulations are revoked and declared invalid. These are Regulation No. II-D regarding Stock Option Trading (Appendix of PT Bursa Efek Indonesia Board of Directors Decree No. Kep-310/BEJ/09-2004); PT Bursa Efek Indonesia Board of Directors Decree No. Kep-00031/BEI/03-2020 regarding Changes in Exchange Transaction Trading Time; and PT Bursa Efek Jakarta Circular Letter No. SE-010/BEJ/10-2004 regarding Stock Option Contract Serial Coding at JOTS.
COMMUNICATIONS AND INFORMATION TECHNOLOGY
Updated licensing obligations for telecommunication service providers
Minister of Communications and Information Technology ("MOCI") Regulation No. 14 of 2021 regarding the Third Amendment of MOCI Regulation No. 13 of 2019 regarding the Implementation of Telecommunications Services
Enacted and came into force on December 29, 2021
With the enactment of this Regulation, Multimedia Service Providers of Multimedia Service Network Access Point (NAP) and Internet Protocol Television (IPTV) Providers who obtained an approval letter for the operation of IPTV services are required to adjust their licenses.
Specifically, this Regulation requires providers of Multimedia Service Network Access Points (NAPs) to obtain a Telecommunication Network Operation License no later than December 31, 2025. This obligation applies specifically to the operation of closed fixed networks built in the form of domestic and international routes. Previously, the deadline for this obligation was April 2025.
It also requires providers of IPTV that have obtained a letter of approval for the provision of IPTV services to submit an Adjustment Application for Becoming a Telecommunications Service Provider that Provides IPTV Services by no later than 30 days prior to the end of the validity period of the letter of approval for the provision of IPTV services. Prior to MOCI 14/2021, this obligation fell no later than the expiration of the approval period.
ENERGY AND MINERAL RESOURCES
Environmental and occupational safety guidelines for geothermal industry
Minister of Energy and Mineral Resources Regulation No. 33 of 2021 regarding Occupational Safety and Health, Environmental Protection and Management, and Technical Guidelines for the Indirect Use of Geothermal Energy
Enacted and came into force on December 2, 2021
This Regulation stipulates provisions on the implementation of occupational health and safety (Keselamatan dan Kesehatan Kerja or "K3") in the geothermal sector and geothermal engineering, which includes provisions on pollution control and environmental damage, and the implementation and operation of geothermal supporting business activities. It outlines the application of K3 and geothermal engineering activities, which include activities related to construction, operation, maintenance, demolition, and rebuilding.
Preliminary and Exploration Survey Assignment (Penugasan Survei Pendahuluan dan Eksplorasi or "PSPE") and Geothermal License (Izin Panas Bumi or "IPB") holders are permitted to carry out geothermal well drilling activities after inspection and approval by the appointed authorities. PSPE and IPB holders must put in place pollution and/or environmental damage control measures. The appointed Head of Geothermal Inspectors will supervise the application of K3, geothermal engineering, and pollution and/or environmental damage control, providing technical guidance, carrying out work safety inspections, and issuing administrative sanctions. This Regulation also requires geothermal supporting business activities to be carried out by a geothermal supporting business in the form of a state-owned or regional-owned enterprise, cooperative, private business entity or public service agency.
With the issuance of this Regulation, Minister of Mining and Energy Regulation No. 02.P/20/M.PE/1990 regarding Work Safety in Geothermal Resources Exploration and Exploitation and Minister of Mining and Energy Regulation No. 06P/0746/M.PE/1991 regarding Work Safety Examination of Installation, Equipment, and Techniques Used in Oil and Natural Gas Mining and the Utilization of Geothermal Resources are revoked and declared invalid.
Mineral and coal mining business licenses revoked
Ministry of Energy and Mineral Resources Press Release No. 10.Pers/04/SJI/2022 regarding Government Revocation of 2,078 Mineral and Coal Mining Business Licenses
Issued on January 6, 2022
This Press Release reported that the Government had revoked 2,078 mineral and coal mining business licenses, as part of a drive to improve the administration of natural resources by evaluating Mining Business Licenses (Izin Usaha Pertambangan). Any license found to be unimplemented, unproductive, transferred to another entity or incompliant with applicable regulations is to be revoked. The Press Release also said the Government was considering policies to ensure the maximum benefit from the country's mineral and coal resources.
New provisions on coal domestic market obligation
Minister of Energy and Mineral Resources Decree No. 13.K/HK.021/MEM.B/2022 regarding the Prohibition of Coal Exports and Guidelines for the Imposition of Fines and Compensation Funds for Fulfilling Domestic Market Obligation
Enacted and came into force on January 19, 2022
This Decree stipulates that Mining Business License, Special Mining Business License, Special Mining Business License as a Continuation of the Operation of Contracts/Agreements, and Coal Mining Concession Work Agreement (Perjanjian Karya Pengusahaan Pertambangan Batubara or "PKP2B") holders that fail to meet their domestic coal sale obligations in accordance with Minister of Energy and Mineral Resources Decree No. 139.K/HK.02/MEM.B/2021 shall be subject to administrative sanctions in the form of the temporary suspension or revocation of their licenses.
Mining business entities that do not meet the required domestic coal sale percentage also are subject to a prohibition on coal exports and mandatory payment of fines and/or compensation funds.
New procedures for Mining Business Licenses
Minister of Energy and Mineral Resources Decree No. 15.K/HK.02/MEM.B/2022 regarding Procedures for the Issuance and Registration of Mining Business Licenses
Enacted and came into force on January 21, 2022
This Decree regulates the processes and procedures for applying for and registering a Mining Business License. The Director General of Coal and Minerals, on behalf of the Minister of Energy and Mineral Resources, may also apply specific terms and conditions that must be met by the holders of a Mining Business License for metal minerals or coal before they can carry out business activities. The application process for a Mining Business License will be carried out through the Director General of Coal and Minerals, subject to the fulfilment of administrative, regional, technical, environmental and financial requirements.
This Decree stipulates that the Director General of Coal and Minerals has the authority to suspend Mining Business Licenses at the request of law enforcement authorities or because of share ownership disputes. It also regulates the process for the revocation of a Mining Business License in the event of the bankruptcy of the license holder.
ENVIRONMENT AND FORESTRY
Revocation of forest concession licenses
Minister of Environment and Forestry Decree No. SK.01/MENLHK/SETJEN/KUM.1/1/2022 regarding Revocation of Forest Concession Licenses
Enacted and came into force on January 5, 2022
This Decree stipulates the revocation of 192 forest concession licenses (Izin Konsesi Kawasan Hutan), covering a total of 3,126,439.36 hectares as of January 6, 2022. The ministry previously revoked 42 forest concession licenses between September 2015 and June 2021, covering a total of 812,796.93 hectares.
With the issuance of this Decree, existing forest concession licenses are subject to evaluation and revocation. These licenses include Forest Utilization License (Perizinan Berusaha Pemanfaatan Hutan), Approval for the Release of Forest Areas (Persetujuan Pelepasan Kawasan Hutan), and Provision of Natural Tourism Facilities Business License (Izin Usaha Penyediaan Sarana Wisata Alam). The Director General of Sustainable Forest Management, the Director General of Forestry Planning and Environment Management, and the Director General of Natural Resources Conservation and Ecosystems have been ordered to issue a decree regarding the revocation of the aforementioned licenses and to prepare and stipulate a forest utilization map.
Director General of Coal and Minerals Decree No. 183.K/30/DJB/2020 regarding Procedures for the Registration of Mining Business Permits or Special Mining Business Permits Based on Decisions of Courts or Related Authorized Institutions is revoked and declared invalid beginning January 5, 2022.
HALAL
Updated list of ingredients exempted from halal certification requirement
Minister of Religious Affairs Decree No. 1360 of 2021 regarding Ingredients Exempted from the Halal Certification Obligation
Enacted and came into force on December 27, 2021
This Decree stipulates guidelines for ingredients that are exempted from the obligation to obtain halal certification. Exempted ingredients include (i) ingredients from plants and mining without any cultivation process; (ii) ingredients categorized as without risk of being haram (forbidden or proscribed by Islamic law); and/or (iii) ingredients that are not categorized as harmful and are not related to any haram ingredients. It also determines the classification of ingredients, as further elaborated in the Appendix.
Halal product guarantee for international cooperation
Minister of Religious Affairs Regulation No. 2 of 2022 regarding International Cooperation for the Guarantee of Halal Products
Enacted and came into force on January 6, 2022
With the issuance of this Regulation, the Minister of Religious Affairs determines the types and implementation of international cooperation for halal product guarantees. This includes the initiation process, tax obligations, the drafting and discussion of the cooperation script (naskah kerja sama), and the execution of such script. After an international cooperation on halal product guarantee is up and running, it will be subject to observation, evaluation and periodical reporting by the Halal Product Guarantee Agency (Badan Penyelenggara Jaminan Produk Halal) to the Ministry of Religious Affairs.
HEALTH
BPOM decree on nutritional information for processed foods
Head of National Agency for Food and Drug Control (Badan Pengawas Obat dan Makanan, or "BPOM") Decree No. HK.02.02.1.2.12.21.494 of 2021 regarding the Addition of Type, Description, Nutritional Value, and Servings of Processed Foods Produced by Micro and Small Enterprises that Must Include Nutritional Value Information
Enacted and came into force on December 28, 2021
This Decree describes the additional nutritional information that micro and small enterprises must include on certain processed foods they produce. The list of processed foods affected and their nutritional values can be found in the Appendix of the Decree. Micro and small enterprises must adjust the nutritional value information for processed foods that obtained a marketing authorization prior to the enactment of the Decree within 30 days after the enactment of the Decree. This Decree was issued to implement BPOM Regulation No. 16 of 2020 regarding the Inclusion of Nutritional Value Information for Processed Foods Produced by Micro and Small Enterprises.
New BPOM regulation on manufacture of cosmetics
BPOM Regulation No. 33 of 2021 regarding Certification of Cosmetic Good Manufacturing Practices
Enacted and came into force on December 31, 2021
This Regulation requires cosmetic enterprises in Indonesia to obtain a Cosmetic Good Manufacturing Practice ("GMP") Certificate or a Fulfilment of Cosmetic GMP Aspects Certificate when producing cosmetics. A Cosmetic GMP Certificate is a legal document that certifies the enterprise has fulfilled good manufacturing practices in the production of their cosmetics. A Fulfilment of Cosmetic GMP Certificate is a legal document that certifies the enterprise is currently implementing, gradually or nongradually, good manufacturing practices in the production of their cosmetics. A company can apply for a Cosmetic GMP Certificate through BPOM's e-certificate service. Once issued, a GMP Certificate will be valid for five years.
This Regulation sets out the requirements, procedures, timeline and renewal process for a Cosmetic GMP Certificate and sanctions for violations of the provisions of this Regulation.
Regulating claims on processed food labels and advertisements
BPOM Regulation No. 1 of 2022 regarding Supervision of Claims on Processed Food Labels and Advertisements
Enacted and came into force on January 4, 2022
This Regulation concerns the use of claims such as nutritional, health, isotonic, vegan, etc. on the labels of processed foods. A claim is any description that states, suggests, or indirectly stipulates certain characteristics of a food product relating to its origin, nutritional value, type, production, processing, composition, or other quality factors. Claims on labels must be limited to nutritive/non-nutritive substances, type, amount, and function; daily food intake; balanced nutrition; suitability of the food as a carrier of nutritive/non-nutritive substances. Any claim or description on the label must accurately reflect the actual food product. Claims in advertisements must be in accordance with the approved label in the product's marketing authorization. A claim must also be proven with analysis from an accredited or government laboratory.
The Appendix of this Regulation sets out guidelines for the description of claims, e.g., the criteria for adding "without added sugar" or "without added salt". With the issuance of this Regulation, BPOM Regulation No. 13 of 2016 regarding Supervision of Claims on Processed Food Labels and Advertisements is revoked and declared invalid.
Reporting requirements for the pharmaceutical industry
BPOM Regulation No. 2 of 2022 regarding Activity Reports for the Pharmaceutical Industry and Pharmaceutical Wholesalers
Enacted and came into force on January 7, 2022
This Regulation requires entities that produce pharmaceutical products and pharmaceutical product wholesalers to submit reports on their activities to the head of BPOM. Required reports include those on the import and use of drug active ingredients, drug production and distribution, realization of imports and exports of drugs and drug materials, and the information/profile of the pharmaceutical industry entity. The reports shall be submitted annually before January 15 of each year. Hard drugs must be reported no later than January 25 of each year, and limited over-thecounter drugs and over-the-counter drugs must be reported no later than January 23 of each year.
The Regulation provides details on the required content of the reports and the reporting mechanisms, and sanctions for failing to adhere to reporting obligations. With the issuance of this Regulation, BPOM Regulation No. 35 of 2019 regarding Reporting of Pharmaceutical Industry Activities is revoked and declared invalid.
BPOM regulation on cosmetics products claims
BPOM Regulation No. 3 of 2022 regarding Technical Requirements for Cosmetics Claims
Enacted and came into force on January 7, 2022
This Regulation requires business entities to ensure that the cosmetic products they circulate meet the technical requirements for any claims on the products' labels and advertisements. Such claims must fulfil the criteria for legal compliance, authenticity, honesty and fairness, and they must be provable, clear and understandable. It is prohibited to claim to be able to cure a disease. The holder of the cosmetics notification number shall be responsible for any claims made on the product. This Regulation provides guidelines for cosmetics claims and a list of allowed and prohibited claims. Claims can only be made if they are authentic and objective. For example, a face cream may claim that it moisturizes the skin, but a cosmetics product cannot claim to be able to lessen rashes, cure stretch marks, etc.
With the issuance of this Regulation, BPOM Regulation No. 19 of 2015 regarding Technical Requirements for Cosmetics Claims is revoked and declared invalid.
INDUSTRY
Import tariffs on motor vehicles
Minister of Industry Regulation No. 37 of 2021 regarding Amendments to Minister of Industry Regulation No. 23 of 2021 regarding Four or More Wheeled Motor Vehicles
Enacted and came into force on December 31, 2021
This Regulation amends several tariffs for the import of certain motor vehicle components as regulated further in the Attachment to this Regulation. The amended import tariffs include those for the import of Completely Knocked Down (CKD) and Incompletely Knocked Down (IKD) motor vehicles with four wheels or more.
The tariffs for certain components referred to in this Regulation were being applied with the generally accepted import duty rates (most-favored nation). With the issuance of this Regulation, the tariffs are now based on the tariff heading for each component as provided in the relevant regulations.
New regulation on Low Carbon Emission Vehicles
Minister of Industry Regulation No, 36 of 2021 regarding Low Carbon Emission Four-Wheeled Motor Vehicles
Enacted and came into force on December 31, 2021
This is an implementing regulation for Government Regulation No. 73 of 2019 regarding Taxable Goods Classified as Luxury Goods in the Form of Motorized Vehicles Subject to Sales Tax on Luxury Goods, as amended by Government Regulation No. 74 of 2021.
The Regulation provides that Low Carbon Emission Vehicles ("LCEVs") are subject to Sales Tax on Luxury Goods. Under this Regulation, companies that produce LCEVs are required to obtain two types of Determination Letters, i.e., (i) Company Determination Letter and (ii) Vehicle Determination Letter. The application for these letters must be submitted electronically through the National Industrial Information System (Sistem Informasi Industri Nasional or "SIINas").
MARITIME AFFAIRS AND FISHERIES
New regulation on increasing the added value of fishery products
Minister of Marine Affairs and Fisheries Regulation No. 59 of 2021 regarding Increasing the Added Value of Fishery Products
Enacted and came into force on December 31, 2021
This Regulation was enacted in an effort to increase the added value of fishery products in Indonesia and support business actors that succeed in increasing the added value. Under this Regulation, the government's efforts to encourage the increase in added value are carried out through: (i) stipulation of guidelines and standard operating procedures aimed at increasing the added value of fishery products; (ii) fishery product development; (iii) the development of a Center for Fishery Products; (iv) assistance, supervision, and consultation; (v) education and training; (vi) research and development; and (vii) the development of capital schemes.
Business actors that produce fishery products with an added value of at least 50% and fish content of at least 30% percent are eligible for: (i) ease of access to capital; (ii) expedited and simpler business permit process; (iii) marketing facilitation; and (iv) the provision of processing facilities.
TAX, CUSTOMS AND EXCISE
Types of documents exempted from stamp duty
Government Regulation No. 3 of 2022 regarding Exemption from the Imposition of Stamp Duty
Enacted and came into force on January 12, 2022
This Regulation stipulates four types of documents that may be exempted from stamp duty, whether on a temporary or permanent basis. The four types of documents are: (i) documents evidencing the transfer of land and/or building rights to expedite the social and economic recovery of a region affected by natural disaster; (ii) documents evidencing the transfer of land and/or building rights for the purpose of noncommercial religious and/or social activities; (iii) documents to support or implement a government program in the monetary or financial services sector; and/or (iv) documents to implement international agreements.
TOURISM
Updated provisions on tourism business certification
Minister of Tourism and Creative Economy Regulation No. 18 of 2021 regarding Implementation of Tourism Business Certification
Enacted on December 20, 2021 and came into force on December 24, 2021
This Regulation stipulates that the tourism business is categorized into three risk levels, i.e., medium-low, medium-high and high risk. The risk-level categorization is based on the Tourism Business Standards elaborated in this Regulation. Businesses categorized as medium-high and high risk must apply for Tourism Business Certification, which, once obtained, will remain valid as long as the business actor carries out its activities. Certification is voluntary for business actors considered as medium-low risk and the certification, if obtained, will be valid for three years.
Regardless of risk categorization, business actors apply for the certification online to an independent and accredited Tourism Business Certification Agency (Lembaga Sertifikasi Usaha Bidang Pariwisata or "LSU"). After the issuance of the Tourism Business Certification by the eligible LSU, the holder of the certificate will be subject to periodical supervision by the Ministry of Tourism and Creative Economy and related government agencies.
With the issuance of this Regulation, Minister of Tourism and Creative Economy Regulation No. 6 of 2020 regarding Tourism Business Certification is revoked and declared invalid.
TRADE
Amendments to export policy, particularly for oil exports
Minister of Trade Regulation No. 2 of 2022 regarding the Amendment of Minister of Trade Regulation No. 19 of 2021 regarding Export Policy and Regulation
Stipulated on January 18, 2022 and came into force on January 24, 2022
This Regulation amends provisions in Appendix I and Appendix IV of Minister of Trade Regulation No. 19 of 2021. With the issuance of this Regulation, business actors wishing to export crude palm oil, refined, bleached and deodorized palm olein, or used cooking oil must have a business permit in the form of an export approval.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
