Jul

13

Private-interest Terminal and Special Terminal Regulation in Indonesia

Along with the economic developments in the Port sector, business owners can build special terminals to facilitate their business, such as a Special Terminal and Private-interest Terminal. Terminal and transportation infrastructure has a critical role in supporting business chains. Without the availability of decent transportation infrastructure, businesses will face many obstacles, i.e., delays in shipping goods.

A Special Terminal, as regulated in the Regulation of the Minister of Transportation No. 52 of 2021 concerning Special Terminal and Private-interest Terminal, is a terminal located outside the work area or Daerah Lingkungan Kerja and the Port Interest Environment Area or Daerah Lingkungan Kepentingan Pelabuhan, which is part of the nearest port to serve its interests under its primary business. Meanwhile, a Private-interest Terminal is a terminal located within the Work Area or Daerah Lingkungan Kerja and the Port Interest Environment Area or Daerah Lingkungan Kepentingan Pelabuhan, which is part of the port to serve its interests under its primary business.

A Special Terminal and Private-interest Terminal can only be built if:

  1. The nearest port cannot accommodate main business activities, such as (a) agriculture; (b) forestry; (c) fishery; (d) mining and excavation; (e) processing industry; (f) procurement of electricity, gas, steam/hot water, and cold air; (g) water management, wastewater management and recycling; (h) construction; (i) large trade; (j) accommodation; (k) tourism areas, natural tourism parks, and national parks; and (l) certain activities which when carried out require dock facilities. To serve their activities, the aforementioned businesses are allowed to construct and operate a terminal.
  2. Based on economic and technical considerations, operations will be more effective and efficient and ensure the safety and security of shipping.

Other than that, both terminals can only be operated for:

  1. Ship traffic activities, boarding and disembarking passengers, or loading and unloading of raw materials goods, production products and/or production support equipment for their interests; and
  2. Government activities, including research, education and training, as well as social activities.

The permit for Special Terminals and Private-interest Terminals to serve public interests in certain circumstances may be granted by submitting an application by the nearest port operator to Directorate General Sea Transportation, but that is only in an emergency state, as follows:

  1. there is a natural disaster or other event causing a malfunction of the port.
  2. there is no port in the area concerned, or no other transportation facilities available, or a lack of port facilities to serve port services, hampering the distribution of goods.
For this condition, the permit for a Special Terminal to serve public interests may be granted for a maximum period of two years. It can be extended a maximum of two times, while the permit for a Private-interest Terminal to serve public interests may be granted for one year. It can be extended based on the evaluation results from the port operator that indicates a need to address the emergency situation and decision to extend the state of emergency from the authorized agency.

If you intend to establish a Special Terminal or Private-interest Terminal as explained above, Schinder Law Firm is one of many corporate law firms in Indonesia that have handled a lot of similar cases, with many experienced and professional civil lawyer, and investment and dispute lawyers in its arsenal, 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