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Archive for January 2016

Cancellation Of Foreign-Language Contracts: Challenges and Solutions

Friday, December 18, 2015 The issuance of Law No. 24 of 2009on The Indonesian Flag, Language, National Emblem, and National Anthem (Law 24/2009) could very well be described as a thorn in the side of the freedom-of-contract principle. The reason for this revolves around the Language Law, which stipulates that contracts entered into by Indonesian…

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GOVT: No harsh sanctions for PT FREEPORT over Divestment Obligation

The Ministry of Energy and Mineral Resources (ESDM) has asserted that the government will take firm action regarding the late implementation of mandatory divestment by mining companies, and this includes PT Freeport Indonesia (PT Freeport). However, the government has also stressed that careful steps need to be taken before any sanctions are imposed after a…

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The New Regulations on Guidelines for Doing Business in Indonesia

On 26 October 2015, Indonesia Investment Coordinating Board (Badan Koordinasi Penanaman Modal or BKPM) has just issued 4 (four) new regulations as part of the Indonesian Government’s Economic Stimulus package. The newly issued regulations are as follows: Head of BKPM Regulation No. 14 of 2015 on Guidelines and Procedures for Capital Investment Principle Licenses (“BKPM…

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BKPM Regulates Procedure for Tax Holiday Application

Introduction The Minister of Finance’s latest incentive for pioneer industry that is implemented on 16 August 2015 through issuance of Minister of Finance Regulation No. 159/PMK.010/2015 of 2015 on Institutional Income Tax Reduction Facility (Ministerial Regulation No. 159/2015) is responded by the Chairman of Indonesia Investment Coordinating Board (BKPM) through issuance of Regulation No. 13…

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New Non-Taxable Income and Calculation of BPJS for Health Premium and its Service

Introduction The Minister of Finance increases Non-Taxable Income through the issuance of Regulation No. 122/PMK.010/2015 on Adjustment of Non-Taxable Income (Ministerial Regulation No. 122/2015) that have been effective since 29 June 2015. The Ministerial Regulation No. 122/2015 stipulates that the amount of Non-Taxable Income is as follows[i]: IDR 36,000,000 for individual taxpayer Additional IDR 3,000,000…

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SUPREME COURT: ANY AGREEMENT REQUIRED TO BE MADE IN BAHASA INDONESIA

On August 31, 2015, the Supreme Court (MA) has decided that Loan Agreement between Nine AM Ltd. And PT Bangun Karya Pratama Lestari (KPL) was cancelled because it violated the Law Number 24 of 2009 regarding The State Flag, Language, Emblem and The National Anthem, related to the use of language in contracts with foreign…

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Latest Incentive for Pioneer Industry: Income Tax Reduction

Introduction To attract more new investments in pioneer industries in Indonesia, the Minister of Finance recently issued Regulation No. 159/PMK.010/2015 of 2015 on Institutional Income Tax Reduction Facility (Ministerial Regulation No. 159/2015). The Ministerial Regulation No. 159/2015 is effective since 16 August 2015 and repeals Minister of Finance Regulation No. 130/PMK.011/2011 along with its amendment…

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New Procedure For Foreign Workers Employment In Indonesia

As a response to President Jokowi request to simplify foreign workers employment procedure and to remove obligation to be able to speak Indonesian language, the Minister of Manpower issued Regulation No. 16 of 2015 on Procedure to Employ Foreign Workers (“Ministerial Regulation No. 16/2015”) which has been effective since 29 June 2015. Consequently, the Ministerial…

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Minister of Trade Issued New General Provision on Imports

Introduction The Minister of Trade recently issued Regulation No. 48/M-DAG/PER/7/2015 of 2015 on General Provision on Imports (Ministerial Regulation No. 48/2015). The Ministerial Regulation No. 48/2015 will be effective on 1 January 2016 and will also revoked and replace current general provision on imports as stipulated by Minister of Trade Regulation No. 54/M-DAG/PER/10/2009 (Ministerial Regulation…

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