16 September 2019 (closed)
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Recently, the Indonesia Investment Board (BKPM) issued two new regulations which replace BKPM regulation number 5 of 2013 as amended by number 12 of 2013 about Guidelines and Procedures on Licensing and Non-licensing of Capital Investment (“Old Investment Regulation”). The two new regulations are BKPM regulation number 14 of 2015 about the Guidelines and Procedures for Principle Investment Licensing and BKPM regulation number 15 of 2015 about Guidelines and Procedures on Licensing and Non-licensing of Capital Investment. In this column we discuss the contents of BKPM Regulation number 14 of 2015
BKPM Regulation Number 14 of 2015: Principle License
A foreign investor who is establishing a foreign investment limited liability company is required to obtain a principle license. Based on the new investment regulation the principle license can be subdivided into the following forms:
1. Principle license
2. Principle license for expansion of business
3. Principle license amendment
4. Principle license for merger
5. Investment license
Procedures of Foreign Investment
The new investment regulation regulates the procedure how to secure a foreign investment principle license. Amongst others this includes:
1. The minimum company capital amount of IDR 10 billion
2. Submission to the related government body
3. Issuance procedure of the principle license
Divestment for Foreign Investors
Under the Old Investment Regulation there was no longer regulated a divestment requirement. Divestments were only required to be made if they were set in the individual principle license of foreign investment companies. The new investment regulation sets a general divestment again of minimum IDR 10 million.
The new BKPM Regulation number 14 of 2015 is enforced on the following dates:
1. October 26, 2015 for the one-stop integrated services which are operating at the BKPM; and
2. December 8, 2015 for the one-stop integrated services which are operating at the provincial/ municipality level, free-trade areas/markets and special economic zones.
In our next column we will generally discuss the contents of the other new investment regulation: BKPM regulation number 15 of 2015.
This column is provided by PNB Law Firm Jakarta