Incentives for New Capital City Project in Indonesia

The Indonesian government has recently issued Government Regulation No.12 of 2023 concerning the Granting of Business Licenses, Business Ease, and Investment Facilities for Business Actors in the New Capital City of Nusantara ("GR 12/2023"), which provides various fiscal and non-fiscal incentives to businesses seeking to invest in Indonesia's new capital city, Nusantara. The regulation aims to provide greater...

VAT Incentive Regulations on the Purchase of Electric Vehicles

The Government is committed to accelerating economic transformation through value-added tax (VAT) incentives for the purchase of electric vehicles, including four-wheeled vehicles and buses in Indonesia. The Ministry of Finance has issued Minister of Finance Regulation No. 38 of 2023 concerning Value Added Tax on the Delivery of Certain Four-Wheeled Battery-Based Electric Motor Vehicles and Certain Battery-Based...

Minister of Manpower Regulation No.5 of 2023: Companies Can Adjust Labor Wages

Recently, the Ministry of Manpower issued a regulation in Indonesia intended to maintain the sustainability of the industrial climate in Indonesia amidst global economic uncertainty. This is the Minister of Manpower Regulation No. 5 of 2023 concerning Adjustment of Working Time and Wages in labor-intensive export-oriented industrial Companies that Affected by Changes in the Global Economy ("MOMR 5/2023").

Tax Holiday for Investment in The New Capital City of Indonesia

The Indonesian government has been contemplating a relocation of the country's capital from Jakarta to Nusantara. The development of the new capital requires substantial private investment, and the government is incentivizing such investment with the recently enacted Government Regulation Number 12 of 2023 on the Provision of Business Licenses, Ease of Doing Business, and Investment Facilities for Businesses in the Nusantara Capital City ("GR 12/2023").

Failing to Disclose Information Regarding Beneficiary Ownership, Corporations Shall Face Obstruction by the Directorate General of General Legal Administration, Ministry of Law and Human Rights in Indonesia

The disclosure of beneficial ownership data by corporations is crucial in preventing corruption in licensing and procurement of goods/services, as well as in aiding case management. However, as of December 2022, only 38.47% of beneficial ownership data has been declared in Indonesia...

Updated Provisions on Electrical Charging Infrastructure for Battery-based Electric Vehicles in Indonesia

To accelerate the battery-powered electric motorized vehicles ("Electric Vehicles") program and the provision of charging infrastructure, the Minister of Energy and Mineral Resources has issued Regulation No. 1 of 2023 on the Provision of Electrical Charging Infrastructure for Battery-powered Electric Motorized Vehicles ("Regulation 1/2023") as a fundamental regulation in Indonesia. Consequently, the previous legal...

Companies Shall Provide the THR No Later Than Seven Days Before Eid Al-Fitr 2023

The Religious Holiday Allowance or Tunjangan Hari Raya (THR) is a mandatory bonus payment for employees in Indonesia before religious holidays, such as Eid al-Fitr or Christmas. The payment is intended to help employees celebrate the holidays and cover their expenses during the festive season.

Are Non-solicitation and Non-competition Clauses in Employment Agreements Necessary in Indonesia?

There are clauses in employment agreements that are often included, namely confidentiality, non-solicitation and non-competition clauses. The purpose of these clauses is to avoid unfair competition and attempts to create competitors or having former employees take advantage of the company's data, information and customers.

Ratification New Indonesia Criminal Law

On 2nd January 2023, the Indonesian Criminal Code was finally ratified into Law Number 1 of 2023 concerning regulation in Indonesia ("Law 1/2023"). The objective of enacting Law 1/2023 is to replace Law Number 1 of 1946 concerning Criminal Regulation ("Law 1/1946"), which was notable as the colonial Criminal Code. Article 622 Paragraph (1) of Law 1/2023 stipulates that after the Law 1/2023 comes into effect, Law 1/1946 shall be revoked. The ratification of Law 1/2023 marks the beginning of the transition to the new era of Indonesian criminal law.

Indonesia Customs and Excise Activity Guarantee Rules Change Starting in 2023

The government changed the provisions regarding guarantees in the context of customs and excise activities. Minister of Finance Sri Mulyani Indrawati issued Minister of Finance Regulation No. 168/PMK.04/2022 concerning Guarantees in the Context of Customs and Excise Activities ("PMK 168/2022") regarding guarantees in the customs framework that took effect on January 1, 2023. This was done to improve services to the public and ensure legal certainty for the user in the field of customs and excise.