LEGAL ALERT MAY 2014 SSEK Legal Alert is a monthly publication of SSEK, Indonesian Legal Consultants. SSEK s lawyers, advisors and associates provide a wide range of legal services to Indonesian and multinational corporations, banks, joint ventures and other organisations. SSEK Legal Alert is a monthly survey designed to keep our clients up to date with the latest legal developments in Indonesia. To subscribe, visit our website: www.ssek.com. * * * banking Bank Indonesia Regulation No. 16/10/PBI/2014 of 2014, dated May 14, 2014, regarding Receipt of Foreign Exchange Export Revenue and Withdrawal of Foreign Exchange Offshore Loans. This Regulation governs the supervision of the receipt of export revenue in the form of foreign exchange and the withdrawal of foreign exchange offshore loans through Indonesian banks. It also sets out the procedure to submit a report after receiving and withdrawing payment using foreign exchange. This Regulation revokes Bank Indonesia Regulation No. 13/22/PBI/2011 regarding Reporting Obligation for Foreign Exchange Offshore Loan Withdrawal and Bank Indonesia Regulation No. 14/25/PBI/2012 regarding Receipt of Foreign Exchange Export Revenue and Withdrawal of Foreign Exchange Offshore Loans. This Regulation came into effect on the date of its enactment. Bank Indonesia Regulation No. 16/9/PBI/2014 of 2014, dated April 8, 2014, regarding the Second Amendment of Bank Indonesia Regulation No. 7/14/PBI/2005 regarding Limitations on Rupiah Transactions and the Granting of Credit in Foreign Currency by Banks. This Regulation was issued to give business actors the flexibility to conduct hedging transactions for their economic activities in Indonesia, especially the hedging of investment revenue in Indonesia. This Regulation came into effect on the date of its enactment. Head of Department of Money Management of Bank Indonesia Circular Letter No. 16/6/DPU, dated April 17, 2014, regarding the Implementation of the Bank Indonesia Cash Service Information System ( BISILK ). BISILK is an information system implemented by Bank Indonesia and used by banks to support money deposits and/or withdrawals. The implementation of BISILK is stipulated for two categories: (i) for banks in the working territory of the Bank Indonesia Central Office, the system will be implemented on April 21, 2014, and (ii) for banks outside the working territory of the Bank Indonesia Central Office, the system will be implemented on August 18, 2014. This Circular Letter came into effect on April 21, 2014. customs and excise Minister of Finance Regulation No. 62/PMK.04/2014, dated April 8, 2014, regarding the Trade of Excisable Goods in which Excise Duty Payment Is made by the Attachment of Excise Ribbon or the Attachment of Other Excise Payment Mark. Under this Regulation, excisable goods, in which the excise duty payment is through the attachment of excise ribbon or the attachment of other excise payment mark, may be offered, delivered, sold, or provided to be sold only after packaged for retail sale and affixed with an excise ribbon or other mandatory excise payment mark. This Regulation SSEK legal alert 1
revokes Minister of Finance Regulation No. 236/PMK.04/2009 regarding the Trade of Excisable Goods. This Regulation came into effect 30 days after its enactment, i.e., May 8, 2014. finance Financial Services Authority ( OJK ) Circular Letter No. 7/SEOJK.04/2014 of 2014, dated April 24, 2014, regarding the Implementation of Face-to-Face Meetings in the Acceptance of Mutual Fund Holders through the Opening of Electronic Accounts, and Subscription and Redemption of Mutual Funds Carried Out Electronically. This Circular Letter requires investment managers to have direct meetings with investors and mutual fund sales agents and sets out the procedures to electronically subscribe to and redeem mutual funds. This Regulation came into effect on the date of its enactment. OJK Circular Letter No. 6/SEOJK.04/2014 of 2014, dated April 24, 2014, regarding the Procedures for Issuers or Public Companies to Submit Reports Electronically. This Circular Letter implements a system for issuers and public companies to submit reports to the OJK electronically through the Issuer or Public Company Electronic Reporting System ( SPE ). This Regulation came into effect on the date of its enactment. OJK Regulation No. 2/POJK.05/2014, dated April 8, 2014, regarding Good Corporate Governance ( GCG ) for Insurance Companies. This Regulation sets forth the GCG rules for the insurance sector, which includes general insurance companies, life insurance companies, and insurance loss assessors. The Regulation stipulates obligations, prohibitions, and requirements for insurance companies and the shareholders of insurance companies. It also provides mandatory GCG practices that must be implemented by insurance companies, including internal risk management policies, strategic planning, and information disclosure. This Regulation came into effect on the date of its enactment. forestry Minister of Forestry Regulation No. P.29/MENHUT-II/2014, dated May 16, 2014, regarding Procedures for Converting the Function of a Forest Area. This Regulation provides new administrative and technical requirements for converting the designated function of a forest area. This Regulation provides two types of conversions, namely: (i) Changed Function Conversion, which alters the fundamental function of a forest area, and (ii) Internal Conversion, which does not alter the essential function of a forest area. This Regulation came into effect on the date of its enactment. manpower and transmigration Minister of Manpower and Transmigration Circular Letter No. SE.3/MEN/III/2014, dated March 26, 2014, regarding the Implementation of Mandatory Labor Affair Reports by Companies. This Circular Letter requires all Governors and Regents/Mayors to instruct all regional manpower service offices to simplify the process of receiving and processing companies mandatory manpower reports. This Circular Letter requires all regional manpower service offices to receive and process all mandatory manpower reports submitted by companies free of charge and to complete all necessary procedures within a day after receiving the report. This Circular Letter came into effect on the date of its enactment. SSEK legal alert 2
tax Minister of Finance Regulation No. 60/PMK.03/2014, dated April 1, 2014, regarding Exchange of Information Procedures. This Regulation is in accordance with Article 32A of Law No. 7 of 1983 regarding Income Tax, as lastly amended by Law No. 36 of 2009, whereby the government has the authority to enter into agreement with other governments to avoid double tax evasion and to prevent tax avoidance. Under this Regulation, the Director General of Taxation may exchange information with tax authorities in the Partner Country/Partner Jurisdiction. This exchange of information shall be based on the provisions in a Double Tax Evasion Agreement, Tax Information Exchange Agreement or Multilateral Agreement. This Regulation came into effect on the date of its enactment. telecommunications Minister of Communications and Informatics Regulation No. 15 of 2014, dated April 3, 2014, regarding the amendment of Minister of Communications and Informatics Regulation No. 11/PER/M.KOMINFO/07/2010 on the Implementation of Internet Protocol Television Service ( IPTV Service ). This Regulation amends licensing requirements, shareholding composition requirements, and technical requirements to implement IPTV Service. This Regulation came into effect on the date of its enactment. trade Minister of Trade Regulation No. 20/M-DAG/PER/4/2014 of 2014, dated April 11, 2014, regarding the Control and Supervision of the Supply, Distribution and Sale of Alcoholic Beverages. This Regulation implements Article 9 of Presidential Regulation No. 74 of 2013 regarding the Control and Supervision of Alcoholic Beverages. Under this Regulation, alcoholic beverages are classified into one of three categories depending on alcohol content. It also sets forth the procedures for obtaining the necessary licenses for the importation, distribution, and sale of alcoholic beverages. This Regulation revokes Minister of Trade Regulation No. 43/M-DAG/PER/9/2009 regarding the Supply, Distribution, Sale, Supervision and Control of Alcoholic Beverages, as lastly amended by Minister of Trade Regulation No. 54/M-DAG/PER/8/2012. This Regulation came into effect on the date of its enactment. Minister of Trade Regulation No. 19/M-DAG/PER/3/2014, dated March 28, 2014, regarding Provisions for the Export and Import of Rice. This Regulation provides that only glutinous and broken rice can be exported. It sets that half-milled or fully milled rice, glutinous rice, Thai Horn Mali rice, half-cooked rice, Japonica and Basmati rice with broken rice content up to a maximum of 5%, and rice with broken rice content up to 25-100% can be imported. This Regulation also sets out the parties that can export rice produced under an inorganic agricultural system. This Regulation will come into effect on October 1, 2014. Head of Commodities Futures Trading Regulatory Agency ( Bappebti ) Circular Letter No. 34/BAPPEBTI/SE/03/2014, dated March 14, 2014, regarding Limitations on Licensing in the Alternative Trading System. This Circular Letter provides that to prioritize transactions in the Alternative Trading System, Bappebti will not issue new regulations for the Alternative Trade System including regulations approving participants in such trading system. This Circular Letter is valid for a period of two years and may be extended if necessary. It came into effect on the date of its enactment. SSEK legal alert 3
transportation Minister of Transportation Regulation No. PM.10 of 2014, dated March 13, 2014, regarding Procedures and Requirements to Issue License to Utilize Foreign Ships for Activities outside the Domestic Sea Transportation of Passengers and/or Goods. This Regulation essentially sets forth the procedures to obtain a license to utilize foreign ships for oil and gas surveys, drilling, off-shore construction activities, dredging, and salvage and underwater work. It revokes Minister of Transportation Regulation No. PM.48 of 2011 regarding Procedures and Requirements to Issue License to Utilize Foreign Ships for Activities outside Domestic Sea Transportation of Passengers and/or Goods. This Regulation came into effect on the date of its enactment. miscellaneous CRIMINAL Law No. 8 of 2014, dated March 11, 2014, regarding the Ratification of the Treaty between the Republic of Indonesia and the Republic of Korea on Mutual Legal Assistance in Criminal Matters. This Law ratifies the Treaty between Indonesia and South Korea on mutual legal assistance in criminal matters, which was executed on March 30, 2002. Under the Treaty, the assistance includes the obtainment of evidence or personal statements, the granting of information, documents, notes and evidence, and other assistance required by the requesting party. The Treaty, however, does not include extradition. This Law came into effect on the date of its enactment. Law No. 9 of 2014, dated March 11, 2014, regarding the Ratification of the Treaty between the Republic of Indonesia and the Republic of India on Mutual Legal Assistance in Criminal Matters. This Law ratifies the Treaty between Indonesia and India on mutual legal assistance in criminal matters, which was executed on January 25, 2011. Under the Treaty, the assistance includes the searches for and the identification of people and goods, the submission of documents, providing information, documents, and notes, confiscations, and others. The Treaty is not applicable to the arrest of a person for the purpose of extradition. This Law came into effect on the date of its enactment. Law No. 10 of 2014, dated March 19, 2014, regarding the Ratification of the International Convention for the Suppression of Acts of Nuclear Terrorism. This Law ratifies the Convention for the Suppression of Acts of Nuclear Terrorism, with the Declaration of Article 4 and Reservation to Article 23 paragraph (1). This Law came into effect on the date of its enactment. EDUCATION AND CULTURE Minister of Education and Culture Regulation No. 31 of 2014, dated April 29, 2014, regarding Cooperation for Organizing and Managing Education between Foreign and Indonesian Educational Institutions. This Regulation redefines the technical and administrative requirements for cooperation between Indonesian and foreign educational institutions. It also stipulates that a Joint Educational Institution may not use the word international as part of the institution s name, programs, classes, or courses. This Regulation provides the curriculum, permits, and student and teacher requirements for such Joint Educational Institutions. This Regulation requires all existing international and foreign schools to comply with this Regulation by December 1, 2014, at the latest. SSEK legal alert 4
INVESTMENT Presidential Regulation No. 39 of 2014, dated April 24, 2014, regarding the List of Business Fields that Are Closed and Business Fields that Are Open with Requirements in the Field of Capital Investment. This Regulation sets forth the new Negative Investment List. It replaces the previous Negative Investment List contained in Presidential Regulation No. 36 of 2010 regarding List of Business Fields that Are Closed and Business Fields that Are Open with Requirements in the Field of Capital Investment. This Regulation came into effect on the date of its enactment. PUBLIC WORKS Minister of Public Works Regulation No. 05/PRT/M/2014, dated May 13, 2014, regarding Guidelines for Work Health and Safety Management Systems ( SMK3 ) in Public Construction Works. This Regulation guides service providers and users in implementing SMK3. According to this Regulation, SMK3 covers policy, planning, operational control, performance examination and evaluation, and performance review of work health and safety. It also sets out the rights and responsibilities of all relevant officers. This Regulation revokes Minister of Public Works Regulation No. 09/ PRT/M/2008 with the same title. It came into effect on the date of its enactment. National Construction Service Development Agency Regulation No. 2 of 2014, dated April 1, 2014, regarding Procedures for the Registration of the Conversion of Construction Service Business Entity Certificate. The scope of this Regulation includes provisions on registration, requirements, mechanisms, costs, and others. The national Construction Service Development Agency ( LPJK ) implements the registration of Business Entity Certificate ( SBU ). The application for the registration of SBU conversion was required to be submitted through the Companies Association or directly to the LPJK at the latest on June 30, 2014. This Regulation came into effect on the date of its enactment. TOURISM Minister of Tourism and Creative Economy Regulation No. 4 of 2014, dated April 11, 2014, regarding Tourism Transportation Service Standards. This Regulation governs and stipulates benchmarks for implementing tourism transportation service standards and guidance on the best practices in offering tourism transportation services. It generally covers the categorization of tourism transportation services, the assessment and implementation of certification for tourism transportation services, supervision of such services and administrative sanctions for failure to meet minimum service standards. This Regulation came into effect on the date of its enactment. * * * You can find our Legal Alert archive at blog.ssek.com. This publication is intended for informational purposes only and does not constitute legal advice. We have endeavored to update information where appropriate, but we are under no obligation to do so. Any reliance on the material contained herein is at the user s own risk. You should contact a lawyer in your jurisdiction if you require legal advice. All SSEK publications are copyrighted and may not be reproduced without the express written consent of SSEK. For more information, please contact ssek@ssek.com SSEK legal alert 5