Franchising Your Business in Indonesia

Domestic and international franchise businesses have expanded rapidly as a way of investing in Indonesia. In this country, it is nearly impossible for you to go outside without seeing a franchise business, be it in F&B (McDonald’s, KFC, Starbucks Coffee), retail (Alfamart, Indomart), or beauty and personal care (Haircode, Kaizen).

However, the regulatory system around franchising is extensive and complex, which poses a challenge for business actors who want to grow through this route.

The following are some of the regulations regarding franchising in Indonesia:

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Outsourcing Business Licensing

Companies providing outsourcing services (the “Outsourcing Company”) shall comply with the provisions of the Ministry of Manpower Regulation No. 11 of 2019 on Requirements of Partial Work Division to Other Company (the “Regulation”), the newest regulation on outsourcing arrangements. The Regulation requires that the following are produced or amended:

The Outsourcing Agreement (the “Agreement”) needs to clearly state the following additional clauses:

1. Description of the type(s) of works to be performed by the workers/employees of the Outsourcing Company;

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Job Positions Allowed in Indonesia for Foreign Workers

Job Positions Allowed in Indonesia for Foreign Workers
Companies who are looking to hire foreign workers should refer themselves to the Ministry of Manpower Regulation No. 228 of 2019 regarding the Specific Positions Open for Foreign Workers (the “Regulation”)

The Regulation specifically addresses job titles that are open for foreign workers in 18 industry sectors, with all 18 industry sectors listed in the table below:

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Changes of Investment Structure in Mineral and Coal Mining Sector

Indonesia’s Minister of Energy and Mineral Resources has recently relaxed regulations on changes in investment structures within the mineral and coal mining sector. In the past, changes such as those in investments, financing source, investment status (Foreign Investment or Domestic Investment), Articles of Association, could only be performed after obtaining ministerial approval.1

Now, through the Regulation of the Minister of Energy and Mineral Resources No. 11/2018, any increase in authorized capital, subscribed capital, and paid-up

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Developer and Buyer Guide for Executing the Engagement Agreement for Sale and Purchase of Land and Building (“PPJB”)

The Ministry of Public Works and Housing has enacted Regulation No.11/PRT/M/2019 (the “Regulation”) regarding PPJB on 18 July 2019. The Regulation is applicable to sale and purchase transactions of residential real estate and properties, including private houses, private commercial houses, cluster houses, and apartment units. In the PPJB context, the term “Developer” refers to both an individual and legal entity.

The Regulation regulates PPJB transactions, which are usually entered by …

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The Rise of Insurance Technology in Indonesia

The insurance industry in Indonesia began during the Dutch colonial period, presenting itself as one of the many mechanisms to secure the Dutch’s trading activities. Indonesians are vaguely familiar with the benefits of insuring themselves against loss, damage, illness or death – ultimately, this lack of awareness materializes in the low adoption rates of insurance coverage.

The Jakarta Post reported that only 1.7 % (one point seven percent) of the population have insurance, and as a result, Schinder Law Firm sees a substantial opportunity for the insurance business to grow rapidly in Indonesia…

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The Impact of the European Union’s General Data Protection Regulation on Indonesian Companies

The European Parliament and the Council of European Union enacted Regulation 2016/679 on 25 May 2018, known as General Data Protection Regulation (“GDPR”). The GDPR provides a set of standardized data protection laws, which are intended to make it easier for consumers worldwide to understand how their data is being used.

GDPR has extra-territorial application outside European Union (“EU”) member states, and therefore affects data processing activities of controllers in other countries including Indonesia, where goods and services …

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ASOSIASI FINTECH PENDANAAN BERSAMA INDONESIA (AFPI) & the Supervision Peer-to-Peer Lending Companies In Indonesia

Indonesia’s peer-to-peer lending industry is experiencing massive growth. To help regulate institutions in the space, on October 5th, 2018, the Indonesian Financial Services Authority (OJK) established Asosiasi Fintech Pendanaan Bersama Indonesia (AFPI), the country’s official association for peer-to-peer lending businesses.

OJK inaugurated the association through Letter No. S-5/D.05/2019 dated March 8th, 2019, and now requires every peer-to-peer lending company…

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Schinder Law Firm Hosted Atma Jaya University’s Summer Course on Business Law

On 24 July 2019, Schinder Law Firm hosted a full-day class of Atma Jaya University’s Summer Course on Business Law. The international students participating in the Course are from Afghanistan, Egypt, Eritrea Iraq, Sudan, Somalia, Taiwan, and Vietnam. The class was intellectually stimulating and culturally enriching for both our firm and the students.

Our Senior Advisors Professor IBR Supancana and Dr Bambang Supriyanto, who are also faculty members of the University, delivered lectures on Indonesian investment and employment laws…

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The Regulations of Emissions Quality Standards in Thermal Power Plants

Jakarta’s sky consistently finds itself shrouded in a blanket of pollution, followed by hundreds of citizens using their smartphones to monitor the air quality. On a car free day, many pose the question: is today’s pollution safe enough for me to exercise outside? Although the city’s steep pollution comes as no surprise to many inhibitors, the citizens of Jakarta are beginning to take serious actions against the government to demand better air quality.

In light of the topic of air quality standards, Schinder Law Firm highlights a new regulatory policy: the Minister of …

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