STABILITY ATTEMPTED THROUGH THE MANDATORY USE OF RUPIAH

In today’s constantly changing economic environment, it would be nearly impossible to find someone who doesn’t know the significance of US President Benjamin Franklin: the face of the USD 100 dollar bill. While USD continues to be the most heavily traded currency throughout the world, Indonesia took a stand.

The Indonesian Central Bank (“BI”) Regulation No 17/3/PBI/2015 regarding the Mandatory use of Rupiah within the territory of Republic of Indonesia (“PBI”) was enacted on 31 March 2015. The main purpose of…

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DAAB Legality: What the 2017 Indonesian Construction Services Law

As skyscrapers erect, apartment buildings emerge, and infrastructure materializes all around Indonesia, one symptom of progress is certain: construction disputes. While best efforts are undoubtedly made to protect cross-border and domestic parties through proper contracts, discrepancies arise. The construction contracts for many international projects use a FIDIC (an international standard organization for consulting engineering & construction) construction-contract template as the basis. Parties then adjust the clauses in the template pursuant to their project’s needs….

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New OSS System Makes Business Licenses Easier Than Ever

When entrepreneurship in on the mind, the last thing anyone wants is a loss of momentum. Getting a business license shouldn’t feel like walking in the sand when it comes to the paperwork involved. Great news!

The Indonesian Coordinating Ministry for Economic Affairs already officially announced a new system in Integrated Licensing Services Electronics on Monday, 9 July 2018. This new Online Single Submission (OSS) launch is launched based on the Government Regulation Number 24 Year 2018…

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SPIN-OFF COMPANIES: A GENERAL VIEW

A spin-off company can be understood as a new, independent company resulting from either a separation or a solution from a larger parent company. The action of ‘spinning-off’ a company may be achieved by distributing or separating the shares (including its assets, employees, and intellectual property) from the parent company as special dividends on a pro-rata basis.

There are number of reasons why parent companies create spin-offs. One common motive is to allow the parent company to focus on core operations and on the management of its resources and divisions while using a spin-off to expand into a wider market. While this can potentially have higher costs…

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Expatriate Employment Permits: No Longer Needed!

To address industry specialization demand, the Indonesian government has issued a new regulation concerning Procedures for Employing Expatriates under the Minister of Manpower Regulation Number 10 Year 2018 (“Permenaker 10/2018”). This regulation facilitates the implementation of Presidential Regulation Number 20 Year 2018 concerning Exertion of Expatriate Employment (Penggunaan Tenaga Kerja Asing), which was issued on 26 March 2018 and took effect on 30 June 2018.
Examining the new regulation, there are some significant changes the government has mandated in terms of expatriate employment….

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CHOOSING A SUBCONTRACTOR

Choosing a contractor or subcontractor can often have devastating consequences. The wrong one can plague a project like constant natural disasters. Some of the most typical consequences companies suffer from the making the wrong choice are as follows:

Bad reputation. The project owner can begin to question your reputation. You have to be fully aware that keeping a good portfolio from the current project owner will help to land the next job.
Loss of scheduling delays. If you choose the wrong subcontractor, it might cause your construction schedule to…

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A General Perspective On Peer-to-Peer Lending in Indonesia

Let’s take a big-picture look at this growing sector by answering some of the most frequently asked questions posed to us at Schinder Law Firm.

What is Peer-to-Peer Lending?
The definition of Peer-to-Peer (P2P) Lending or FinTech Lending in the Financial Services Authority Regulation (POJK) Number 77 / POJK.01 / 2016 is the provision of financial services by bringing together lenders with the borrower in the context of borrowing and lending…

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FRANCHISING IN INDONESIA

Under the Ministry of Trade Regulations No. 53/M-DAG/PER/8/2012 JO and No. 57/M-DAG/PER/9/2014 Regarding to Franchise Organizers (“Law”), a Franchise is defined as a special right, owned by an individual or a business entity to a business system with a business characteristic, in order to market goods and / or services that have proven successful and can be utilized and / or used by other parties under a Franchise agreement. In order to become a Franchise Organizer, the products or the method must meet the following criteria. The Franchise must :

1. Posses a business characteristic;…

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THE TAX HOLIDAY FACILITY

Who does it apply to and why?

In order to attract investment, The Government of Indonesia amended the previous Minister of Finance Regulation No. 159/PMK.010/2015 JO No. 103/PMK.010/2016 (“PMK”) regarding Corporate Income Tax Reduction Facilities (otherwise known as the Tax Holiday Facility) with the latest Minister of Finance Regulation No. 35/PMK.010/2018 (“Regulation”). The new Regulation became effectively enforced on 04 April 2018. Subsequenlty, PMK has been revoked and declared null and void by Regulation.
For clarification,…

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KNOW YOUR BENEFICIAL OWNERS PRINCIPLE

Who’s in charge? Where’s the head hancho? How do I find the big boss?

Sometimes discerning just who is legally responsible for a company can be problematic. In Indonesia however, the process of identifying the top dog is one step closer to transparency in business.

On 5 March, 2018, The President of Indonesia issued President Regulation No.13 Year 2018 concerning the Implementation of the Principle on Recognizing Beneficial Ownership of Corporations in the Framework of the Prevention and Eradication of Money Laundering and Criminal Acts of Terrorism Financing…

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