May 26th, 2015 david
As mandated in Law No. 21 of 2011 regarding the Financial Services Authority (“OJK Law”), supervision of Indonesia’s capital markets and non-bank financial institutions was transferred from the Capital Market and Financial Institution Supervisory Agency (“Bapepam-LK”), part of the Ministry of Finance, to the OJK as of December 31, 2012. Oversight of the banking industry was transferred from Bank Indonesia to the OJK on December 31, 2013.
We look at some of the changes that have been introduced since the OJK took over supervision of the capital markets, non-bank financial institutions and banking sectors.
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May 19th, 2015 david
The Financial Services Authority (Otoritas Jasa Keuangan or OJK), the financial services supervisory body in Indonesia, issued more than 30 regulations in 2014 covering capital markets, banks and non-bank financial institutions. Muliaman Hadad, the chairman of the Board of Commissioners of the OJK, issued a statement that the enactment of the regulations supported the goals of the OJK in developing the financial sector in Indonesia.
The OJK issued seven regulations in the banking sector in 2014, three of which were new regulations and four that amended previous regulations. Two of the new regulations – OJK Regulation No. 17/POJK.03/2014 and OJK Regulation No. 18/POJK.03/2014 – concern the implementation of integrated risk management and corporate governance for financial conglomerates. The third, OJK Regulation No. 19/POJK.03/2014, concerns non-office financial services (branchless banking), which is further discussed below.
Those regulations that amend previous regulations are focused on sharia banks and sharia business units. In particular, OJK Regulation No. 16/POJK.03/2014 concerns the assessment of quality assets; OJK Regulation No. 21/POJK.03/2014 stipulates provisions on minimum capitalization; and OJK Regulation No.8/POJK.03/2014 concerns the assessment of soundness level.
The OJK also amended regulations on rural banks (OJK Regulation No. 20/POJK.03/2014), which revoked Bank Indonesia Regulation No. 8/26/PBI/2006 on rural banks.
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May 13th, 2015 david
By Stephen Igor Warokka and Shafira Nindya Putri
In furtherance of Indonesia’s commitment to welcome the implementation of the ASEAN Economic Community (“AEC”) in 2015, Presidential Regulation Number 39 Year 2014 regarding List of Business Fields Closed to Investment and Business Fields Open, with Conditions, to Investment, dated April 24, 2014 (the “2014 DNI”), continues to treat foreign investors from ASEAN countries differently than investors from other countries. This was also true of the previous Negative Investment List under Presidential Regulation Number 36 Year 2010 (“2010 DNI”). Both the 2014 DNI and its predecessor allow investors from ASEAN countries to hold up to 60% share ownership in Indonesian shipping companies engaged in sea transportation business activities with foreign routes.
Supposedly bringing a breath of fresh air to Indonesia’s investment climate, the above provision, bearing in mind the prevailing laws and regulations in the field of shipping, begs one question: how effectively has it been implemented? Read more »
May 12th, 2015 david
SSEK Indonesian Legal Consultants is shortlisted in four categories at the Asian Legal Business SE Asia Law Awards, which recognize the region’s leading law firms and the top deals of the last 12 months.
SSEK is nominated for:
- Banking and Financial Services Law Firm of the Year
- Energy and Resources Law Firm of the Year
- Real Estate Law Firm of the Year
- M&A Deal of the Year
The winners will be announced on May 28 in Singapore. The full list of nominees can be seen here. Read more »
May 12th, 2015 david
Ira A. Eddymurthy, a founding partner of SSEK Indonesian Legal Consultants, and Michael S. Carl, a senior foreign legal advisor at the firm, have been selected for inclusion in the 2015 edition of Who’s Who Legal: Capital Markets, an independent guide to the world’s leading capital markets lawyers.
Ira is recognized as a leading Structured Finance lawyer, while Michael is acknowledged as a leading Debt and Equity lawyer. They are among only six lawyers in Indonesia recognized by Who’s Who Legal in this latest guide to the world’s leading capital markets lawyers.
Ira and Michael work with a diverse range of multinational and domestic companies doing business in Indonesia. They are regularly recognized by Who’s Who Legal, Chambers & Partners, IFLR1000, Legal 500 and Asialaw as leading practitioners in the fields of banking and finance, capital markets, corporate and mergers and acquisitions, and projects and natural resources. Read more »
May 8th, 2015 david
The Employment Law Alliance is offering a free 90-minute webinar on Wednesday, May 20, focusing on “Employee Labor Relations in Canada: A Legal Update for Employers.”
Canada has seen a number of changes recently in both federal and provincial law in the area of employee labor relations that impact all employers, including multijurisdictional Canadian employers. The Supreme Court of Canada’s decision on the constitutional right to strike, the advent of secret ballot votes as opposed to card count under the federal jurisdiction and changes to criteria for exclusions from the bargaining unit in Saskatchewan are just a few examples.
For employers headquartered outside Canada, a map to navigate the complex waters of communications during organizing and negotiations, and certification issues in differing Canadian jurisdictions is essential. This webinar brings together management labor lawyers from across Canada – and one from the U.S. to provide comparisons between the two countries – who will provide guidance on:
- The certification and decertification processes
- What is considered “permissible communications”
- Key issues for consideration in the right to strike
- Overview of exclusions from the bargaining unit and what constitutes good faith bargaining Read more »
May 6th, 2015 david
By Dewi Mayangsari
Foreign parties that wish to invest in Indonesia directly must follow the rules for foreign direct investment in the relevant business sector.
The foreign investor must first establish a limited liability company (“PMA Company”) to engage in business in Indonesia. The PMA Company will be licensed by the Indonesian Capital Investment Coordinating Board (Badan Koordinasi Penanaman Modal or “BKPM”) for the purpose of permitting foreign shareholding.
The Investment License issued by the BKPM identifies the specific business activities in which the PMA Company is permitted to engage. These specific business activities are identified based on an industry classification system known as the Indonesian Standard Industrial Classification (Klasifikasi Baku Lapangan Usaha Indonesia or “KBLI”).
Some KBLI numbers are subject to a foreign shareholding limitation. Any applicable foreign shareholding limitation is set out in the Negative Investment List (Daftar Negatif Investasi or “DNI”), which is currently regulated under Presidential Regulation No. 39 of 2014.
Traditional Advertising Business
The advertising business is classified under KBLI No. 7310, which covers various advertising services (whether conducted directly or sub-contracted), as follows: Read more »
April 28th, 2015 david
The Indonesia Canada Chamber of Commerce (ICCC) has released a policy paper examining the economic relationship between Indonesia and Canada and looking at opportunities to expand that relationship in six key economic sectors.
The paper, “Accelerating Indonesia’s Growth: Opportunities to Enhance the Indonesia-Canada Economic Relationship,” notes that the two countries had bilateral trade of $3.4 billion in 2014, with bilateral trade growing at 15% to 20% per year. Canadian firms have invested more than $3.2 billion in Indonesia, in communications, energy, mining, environment, financial services, aerospace and defense, education, infrastructure, consumer products, health, power, agri-food and agriculture. And Indonesian firms are increasingly becoming aware of investment opportunities in Canada and making sizable investments in the country.
The ICCC policy paper focuses on six key sectors: Oil and Gas, Infrastructure, Agriculture, Renewable Energy, Non-Bank Financial Services, and Mining.
You can go to the ICCC website for a preview of the policy paper and to request a full version.
April 27th, 2015 david
April 21 in Indonesia is celebrated as Kartini Day, which recognizes the life and achievements of Raden Ayu Kartini, a national heroine for her work in the area of women’s rights.
In conjunction with Kartini Day, Hukumonline, which provides news and analysis of Indonesia’s legal system, published an article looking at some of Indonesia’s leading women legal practitioners.
Ira A. Eddymurthy, a founding partner of SSEK Legal Consultants, was featured in the Hukumonline article. Ira was recognized for her contributions to SSEK and the Indonesian legal profession, and her standing as one of the country’s leading corporate and commercial lawyers. Read more »