Aug

10

Construction Equipment Ownership for Foreign Investment Construction Service Business Entities (BUJK PMA) and Construction Representative Offices (KP BUJKA) in Indonesia

Infrastructure investment has been identified as one of the key catalysts for unlocking a country's overall economic potential, promoting growth, creating jobs and reducing poverty. Efficient infrastructure is also needed to lower distribution costs, make prices of goods and services more affordable and improve living standards (ADB 2017). Good infrastructure brings better social and economic mobility, leading to better living conditions. For Indonesia, a country with a large population and an archipelagic territory, developing efficient infrastructure is important for ensuring sustainable and inclusive growth, which leads to construction being one of the primary business activities in Indonesia.

The qualifications for a construction services sub-sector business entity for construction consulting services and construction works as stated in Article 84 of Indonesian Government Regulation No. 5 of 2021 concerning Risk-Based Business Licensing ("GR 5/2021") include the following:

  1. Small Qualification;
  2. Medium Qualification; and
  3. Large Qualification.

In accordance with Article 84 GR 5/2021, foreign investment construction service business entities ("BUJK PMA") and representative offices for foreign construction service companies ("KP BUJKA") are required to meet the "Large Qualification" for construction consulting services and construction works. In determining the qualifications, evaluations are done on several documents, one of which is the ability to provide construction equipment.

The ability to supply equipment shall be provided to the Company no later than 30 (thirty) calendar days from the Construction Business Entity Certificate or Sertifikat Badan Usaha (SBU) being issued. The ability to provide construction equipment is excluded for general construction consulting services.

The ability to supply construction equipment must meet the requirements of at least the main equipment for each sub-classification. The regulation in Indonesia stipulated in Article 95 of GR 5/2021 states that the requirements are as follows:

  1. For Large Qualification, it is required to have at least three main pieces of equipment per sub-classification
  2. For the KP BUJKA, it is required to have at least three main pieces of equipment per sub-classification.
  3. For integrated construction work business activities conducted by businesses with Large Qualifications, it is required to have at least three main pieces of equipment per sub-classification.
  4. For integrated construction work business activities conducted by BUJKA's representative offices, it is required to have at least five main pieces of equipment per sub-classification.

The exhaustive lists of main equipment depending on each sub-classification that need to be provided by BUJK PMA and KP BUJKA, respectively, are stipulated in the Regulation of the Minister of Public Works and Public Housing No. 6 of 2021 Concerning Standards for Business Activities and Products in The Implementation of Risk-Based Business Licensing in the Public Works and Public Housing Sector. The main requirement that must be met is equipment that is functional and operational. For example, the minimum equipment criteria for the office building construction sub-classification (BG002) are tower crane, truck crane, concrete mixer, tamping rammer, concrete pump, vibro hammer, generator set, excavator, motor grader, wheel loader, bulldozer, pad foot roller, sheep foot roller, rig bore pile, dump truck, flat bed truck and water tank truck.

If you intend to establish a BUJK PMA or KP BUJKA in Indonesia, Schinder Law Firm is one of many corporate law firms in Indonesia that have handled a lot of similar establishments, with many experienced and professional civil lawyers with investment expertise, making it one of the top corporate consulting law firms in Indonesia. Feel free to contact us at info@schinderlawfirm.com for further consultation.

Author: Dewi Susanti

Let Us Be Your Guide.
Our thorough understanding of local culture
ensures that your business will be in compliance
with all laws and regulations and receive
a warm welcome in the community.

Dear valued Visitor,

Data is a valuable currency in this new world. In the midst of digital transformation, the Indonesian government has taken the final decision to pass the Pelindungan Data Pribadi (PDP) Bill by September 2022. The PDP Law applies to all businesses established in Indonesia and puts the consumer in control. The task of complying with this regulation falls upon businesses.

The PDP Law affects a variety of business operations, including how your sales team prospect and how marketing initiatives are managed. Businesses have had to reassess their business procedures, applications, and forms. Additionally, all businesses that work with personal data should designate a Data Protection Officer (DPO) or data controller to oversee PDP compliance.

In line with this spirit, it gives us great pleasure to announce and share with all our esteemed clients and business associates that Schinder Law Firm is prepared to assist your company to understand the impacts of the Personal Data Protection Law (PDPL) and take the required measures to comply with the law. Our Privacy, Data Protection, and Cybersecurity practice group is a pioneer in providing data privacy law services in Indonesia. Personal data protection services include but are not limited to:

  • Assessing the existing systems, processes, and controls, etc.
  • Providing provide gap assessment on the existing systems, processes, and controls, etc.
  • Developing and ensuring contracts and agreements comply with the PDP Law
  • Developing policies, best practices, and procedures
  • Advising on the security of personal data and managing data breaches
  • Acting as the Data Protection Officer (DPO) and advising upon the appointment, role, and responsibilities of a data protection officer
  • Advising on cross-border transfers of personal data
  • Carrying out data protection impact assessments and data protection audits
  • Recommending other necessary corrective actions in order to comply with the PDP Law
  • Training on the PDP Law tailored to clients’ businesses

We look forward to many more opportunities in the year ahead with your continued support and trust. For consultation, please send us a WhatsApp or Email.

Warmest regards,
Naz Schinder
Managing Partner

Keep Up with the New Law in Indonesia: Personal Data Protection

  • Assessing the existing systems, processes and controls, etc.
  • Providing provide gap assessment on the existing systems, processes and controls, etc.
  • Developing and ensuring contracts and agreements comply with the PDPL.
  • Developing policies, best practices and procedures.
  • Advising on security of personal data and managing data breaches.
  • Acting as the Data Protection Officer (DPO) and advising upon the appointment, role and responsibilities of a data protection officer.
  • Advising on cross-border transfers of personal data.
  • Carrying out data protection impact assessments and data protection audits.
  • Recommending other necessary corrective actions in order to comply with the PDPL.
  • Training on the PDPL tailored to clients’ businesses.
Privacy, Data Protection and Cyber Security
We help our clients to understand the impact of the Personal Data Protection Law (PDPL) on their companies and take the required measures to comply with the law.