Indonesia Archives

In Tax

Indonesia: A new regulation as the income tax implementing regulation under the HPP Law

February 2, 2023 by Ponti Partogi, R. Daru Hananto, Ria Muhariastuti and Harizka Rizal 6 Mins Read

On 20 December 2022, the Indonesian government issued Government Regulation No. 55 of 2022 on the Adjustment of Regulations in the Field of Income Tax (“GR 55/2022”). This regulation is one of a series of government regulations issued in December 2022 as the implementing regulations of Law No. 7 of 2021 on Tax Regulation Harmonization (“HPP Law”). Several regulations related to income tax (i.e., GR 18/2009, GR 23/2018, and GR 30/2020) are no longer valid, and have been consolidated through the issuance of GR 55/2022. GR 55/2022 mainly provides confirmation and a detailed explanation of income tax provisions under the HPP Law. These include income tax on benefits-in-kind, anti-tax avoidance measures, and international tax agreements.

In White Collar Crime

Indonesia: New Criminal Code – fraudulent acts against creditors chapter

February 2, 2023 by Andi Y. Kadir, Bernard Sihombing, Reno Hirdarisvita and Luthfi Sahputra 4 Mins Read

The New Criminal Code became the first piece of legislation passed into Law in 2023 and was promulgated on 2 January as Law No. 1 of 2023. This alert takes a look at how the New Criminal Code reintroduces crimes related to fraudulent acts against creditors. In the absence of any criminal provisions under Law No. 37 of 2004 on Bankruptcy and Debt Suspension of Payment, any criminal sanctions for fraudulent-related acts against creditors are those originally set out in the old criminal code. The New Criminal Code reinvents the provisions in the old criminal code and reintroduces them as a new section in the fraudulent-related acts against creditors.

In Antitrust / Competition

Indonesia: Asset acquisitions – do you really have to notify?

January 27, 2023 by Mita Djajadiredja and Mochamad Fachri 4 Mins Read

In 2019, the Indonesian Competition Commission (KPPU) issued a regulation that asserted that KPPU has the authority to review acquisitions of assets, not just acquisitions of shares. Since then, hundreds of acquisitions of asset transactions have been notified to KPPU. KPPU’s concepts of “assets” and their “acquisition” under this regulation are very broad.

In Anti-Corruption

Thailand: New rule affirming the “provision or acceptance of gift policy” for governmental officials

January 20, 2023 by Yuthana Sivaraks, Napatorn Dasananjali Termglinchan, Praween Chantanakomes, Pongtorn Jittapinijmas and Woraphan Khunakornkorbkij 3 Mins Read

The “provision or acceptance of gift policy” is a key compliance principle in the governmental sector, as reflected in several key pieces of legislation. On 13 January 2023, the Office of the Prime Minister issued the Regulation on the Provision or Acceptance of Gift of Governmental Officials, B.E. 2565 (2022), which came into effect on 14 January 2023. This regulation updates and strengthens the policy on the provision or acceptance of gifts for the governmental sector. The regulation applies to all government officials, including but not limited to officials, staff, and employees of government agencies and state-owned enterprises.

In Trade and Foreign Investment

Indonesia: New regulation on self-consumed imported goods: what Indonesian importers should consider

January 20, 2023 by Riza Buditomo and Rinaldi Raymond 8 Mins Read

In December 2022, the Indonesian Minister of Finance issued a new regulation on self-consumed imported goods, i.e., MOF Regulation No. 190/PMK.04/2022, on the Transfer of Self-Consumed Imported Goods, to meet the need for a more dynamic regulatory system in the trade sector. This regulation is designed to promote trade and economic growth in Indonesia by providing new import facilities, namely: (i) new import mechanisms for digital goods; (ii) new requirements to submit supporting customs documents; (iii) new requirements for non-MITA/AEO importers to obtain a registration number; (iv) new requirements for physical inspection of self-consumed imported goods; (v) new formulae to calculate import duties, excises and taxes; and (iv) new provisions for transferring imported goods that are subject to intellectual property rights requirements.

In AML & Financial Services Regulatory

Indonesia: P2SK Law – new concepts for securitization and other financial innovations

January 20, 2023 by Erwandi Hendarta, Mahardikha K. Sardjana, Eddie Prabowo Dewanda, Clarissa Frederika and Theresia Fransmanto 4 Mins Read

The P2SK Law introduces the concept of financial instrument managers and trust fund managers. Both are designed as specific purpose entities licensed by Otoritas Jasa Keuangan and established to perform asset securitization and/or trustee fund management activities. The government expects the existence of SPVs to contribute to financial instrument diversification. Trustees, on the other hand, are regulated with the aim of increasing participation by financial market players and bringing about improvement in disclosure and good corporate governance regulations.

In Employment

Vietnam: Indo-Pacific Economic Framework for Prosperity

January 20, 2023 by Thuy Hang Nguyen and Boris Hall 7 Mins Read

In May 2022, the Indo-Pacific Economic Framework for Prosperity (IPEF) was launched between Australia, Brunei, Fiji, India, Indonesia, Japan, South Korea, Malaysia, New Zealand, the Philippines, Singapore, Thailand, the US and Vietnam. On account of its specified focus on labor standards and issues, IPEF is likely to have an ongoing impact on labor regulations and trends among partner countries, including Vietnam.

Indonesian New Criminal Code (part two)

January 16, 2023 by Andi Y. Kadir, Bernard Sihombing, Reno Hirdarisvita, Luthfi Sahputra and Nabila Farhani Oegroseno 6 Mins Read

The New Criminal Code became the first piece of legislation passed into Law in 2023 and was promulgated on 2 January as Law No. 1 of 2023. In the next three years, the New Criminal Code will replace the 100-year old criminal code currently in place. The New Criminal Code changes the landscape of the penal code in the field of digital information, bribery and corruption, and money laundering related crimes.

In Indonesia

Indonesia: The new Job Creation Government Regulation in lieu of Law

January 14, 2023 by Mita Djajadiredja, Nadia Soraya, Cahyani Endahayu, Alvira M. Wahjosoedibjo and Dyah Ayu Paramita 8 Mins Read

The Government of Indonesia issued Government Regulation in lieu of Law No. 2 of 2022 on Job Creation on 30 December 2022 (“Job Creation GRL”). This opens the second act of the Omnibus Law following the scrutiny by the Constitutional Court of the formalities in the creation of the original Job Creation Law which was issued in 2020. Content-wise, the 1,117-page Job Creation GRL is a non-identical twin sibling of the original Job Creation Law with substantive changes on halal certification, employment, taxation, and regional government as well as some non-substantive changes in other sectors such as water resources.

In AML & Financial Services Regulatory

Indonesia: Financing service businesses under the P2SK Law

January 10, 2023 by Erwandi Hendarta, Mahardikha K. Sardjana, Eddie Prabowo Dewanda, Johan Kurnia and Amanda Besar 6 Mins Read

The soon-to-be enacted P2SK Law introduces “financing service businesses” as a new umbrella term for several categories of financing services, covering the businesses of finance companies (multifinance), venture capital companies, infrastructure financing companies, IT-based collective funding service providers (peer-to-peer lending platforms), and pawnbroker companies.