Recently, the Ministry of Internal Affairs (Ministry) issued Regulation number 19 of 2017 (New Regulation) regarding the Revocation of Ministry of Interior Affairs Regulation Number 27 Of 2009 and its amendment (Regulation 2009). Regulation 2009 had set guidelines for regional governments to issue regional regulation in relation to the Nuisance Permits (Izin Gangguan). These guidelines have now been revoked, leaving the local governments free to decide on how to regulate the Nuisance Permit within their Region, provided that they remain in compliance with other existing laws and regulations.
Regulation 2009: Regional Regulations for Nuisance Permits (Izin Ganguan)
The Regulation 2009 defined a Nuisance Permit (Izin Gangguan) as a permit which was required for any party which intends to perform an activity or event which could lead to harm, loss or disturbance in the location of such activity or event. In practice, many types of companies would require a Nuisance Permit (including industrial companies), and were therefore subject to the regional implementation of the Regulation 2009.
Regulation 2009 provided guidelines for local governments to formulate regional regulations in relation to the Nuisance Permit (Izin Gangguan). The Regulation 2009 mentioned a set of minimum requirements which needed to be implemented by the local governments in their Regional Regulations. Now the Regulation 2009 is revoked, these guidelines are not applicable anymore and regional governments have more freedom in deciding the regional regulation regarding the Nuisance Permit (Izin Gangguan). The local governments however still need to comply with the following laws and regulations:
- Hinder Ordonnantie
- Law number 28 of 2009 on Regional Tax and Levy
- Existing regional regulations which are already in force
Consequences of the Revocation of Regulation 2009
The revocation of Regulation 2009 does not lead to the revocation of regional regulations which address the nuisance permits. Therefore, existing regulations remain in place. Local governments have however now more freedom in deciding how to implement their new regional regulations.
It is expected that since the implementation of the New Regulation nuisance permits (Izin Gangguan) will no longer be mandatory and that therefore such permits will effectively be eliminated which shall improve the investment climate in Indonesia.
The New Regulation came into force on March 30, 2017.
This column is provided by PNB Law Firm Jakarta