Indonesia Investment Forum 10 June 2015

Background

Indonesia is a remarkable place for foreign direct investment. A huge deposit of natural resources, large and growing domestic market, as well as young professional and talented human resources are among its investment strength. Supported by stable politic and economic atmosphere after more than 15 years struggle for governance reform, Indonesia is top priority list of investment destination. Friendly investment regulations and speedy application process through one stop services are developed to support professional and integrated investment procedure.
How to work with Indonesia investment law, detail company establishment, man power issue, as well as taxation and financial planning. These questions are usually come up for investors wishing to start business and invest in Indonesia. With this regard, the workshop is presented to provide a comprehensive guideline on the establishment process and other necessary information needed to start doing business in Indonesia.
The topics will be delivered by expert and experienced as well as relevant government official from Indonesia Investment Coordination Board. With comprehensive and valuable content, this is a must attend workshop to all prospective and existing investor to get latest update on the procedure and policies in doing business in Indonesia.

PROGRAMME

1. An Introduction – Current Business Environment in Indonesia

• Introduction on Indonesian Current Economy
• Reasons on the stability of Indonesian economic growth and how its influencing investment climate
• Indonesian profesional business culture
• Indonesian government plans and target for economic development in the coming year
• Indonesian road map toward friendly investment climate
• How politic and economic stability as well as legal enforcement support investment athmosphere

2. Why invest in Indonesia

• Indonesian business competitive advantage
• Tangible and Intagible Benefit in doing business in Indonesia
• How government treat foreign investor
• Incentive and facilities provided by the government to the foreign investors
• Encouraging sectors for foreign investor and incentive provided by government

3. Working with Indonesian Investment Law

• Implementation and challenge of Law No. 25/2007 on Investment
• Protection and equal treatment toward local and foreign investor
• Dispute and settlement method
• Corporate structure for investor
  
  - Foreign Investment Company
  - Representative Office
• Guideline and procedure of Company establishment
• Post Company Establishment Issue
• Negative List Issue

4. Taxation and Facilities

• Initial Tax Administration Procedure
• Tax and Custom Facilities
• Tax and Custom facilities Application Procedure
• Tax Incentives
• Government Incentive for certain Sector
• Tax and Financial Planning
• Transfer pricing issue

Speakers

Keynote Speaker
Dr Ning Rahayu, M.Si
(Lecturer and Researcher in the Administration’s Fiscal Studies Program, University of Indonesia)

Earned her bachelor degree from the Fiscal Administration Program Studies, University of Indonesia in 1980 and achieved her masters degree and PhD in the eld of Fiscal Administration at the same university. Ning is well experienced working as a tax consultant for over 25 years with her last position as the Tax Partner in CPA Santoso Harsokusumo Firm (a member of Horwarth International). Her scope of experience she had undertaken includes from tax compliance, tax audit, tax litigation, taxdue diligence, as well as tax advisory services.Ning also registered as a lecturer and researcher at the Fiscal Administration Program Studies, University of Indonesia.

Dr. Riyatno, S.H., LL.M
(Head of Legal Assistance Center of Investment Coordinating Board of the Republic of Indonesia (BKPM))

Riyatno earned his law degree from Faculty of Law, University of Gadjah Mada Yogyakarta with cum laude in 1993. In the same year, Riyatno was accepted to work for Bureau of Law and Legislation, Cabinet Secretariat of the Republic of Indonesia. In 1997 he obtained a scholarship from Ausaid to conduct LL.M program at Faculty of Law, The Australian National University, Canberra, Australia and graduated with honors. Subsequently in 2000 Riyatno continued his doctoral studies program at the Faculty of Law, University of Indonesia, Jakarta, with a scholarship from the Asia Foundation. To complete the dissertation Riyatno conducted a research at the School of Law, University of Washington, Seattle, USA. Riyatno currently works as Director of the Legal Assistance Center of Investment Coordinating Board of the Republic of Indonesia. Riyatno has also been recorded as a member of the Bilateral Investment Treaty Negotiator Team with the United States in 2008-2009.

 Dr. Ir. Himawan H Djojokusumo, Msc
(Deputy Chairman of Investment Promotion National Investment Coordination Board)

Investment

IDR 3.000.000,-/Person
50% discount for the 5th participant from the same company/institution

Registration Information

SIGN UP

Registration Information

If you find difficulties in doing online registration, please fill in the underneath form and email it to info@lexmundus.com or Fax to (+62-21) 782-3547

Yes, I am willing to join the Lex Mundus training on ”Indonesia Investment Forum”

Name	:
Position	:
Company Name	:
Telp. /HP/ Fax	:
E-mail

• For more information, please contact us at info@lexmundus.com or call us at 021-782-3548, 0878-7727-7840 (with Ms. Ana), 0813-8251-4148 (with Mr. Muqthi), 0812-9093-0663 (with Mr. Yuda)

• Transfer payment to Bank Mandiri RS Islam Branch Office Jakarta accounte number : 123-00-0635238-1 on behalf PT Lex Mundus Indonesia

• Cancellation less than 24 hours before the event will be charged 100% of the full investment cost

• If there is any force majeure or event beyond our control, we reserve the right to change, cancel or reschedule the training date, speakers, and other things related to the training at any time without prior notice.  

Foreign Investment Negative List

After a long waited and discussion, the Government of Indonesia has finally issued the new negative list through Presidential Decree No. 36 Year 2010 Regarding Business Sector that are Closed for Investment and Opened for Investment Under Certain Conditions (“Perpres 36/10”). Perpres 36/10 revoked the previous negative list regulation number 77 of 2007 as amended by Presidential Decree No. 111 of 2007. Under Perpres 36/10, all lines of business are principally opened for foreign investment except for those lines of business that are listed in this new negative list. However, it is advisable for the investor to consult to Indonesian Investment Coordination Board (“BKPM”) if they find their line of business is not listed in this regulation. BKPM and other related government institutions will further decide whether that line of business are opened or closed for foreign investment. In addition, other related regulation may affect to the determination whether certain business sectors are opened or closed for foreign investment. In this case, policy from BKPM is still play a part.

Summary of the New Negative List

The Perpres 36/10 have 12 articles contained of 5 new articles and 7 articles which have the same content with the previous one. The Perpres 36/10 contained 40 business sectors that are more open to the foreign investors and 10 business sectors that are more restrictive. The new negative list is expectedly to attract more investors as the provisions stipulated is considerably liberalization toward some strategic sectors among others in forestry, energy and mineral resources, health services, manpower, information technology, telecommunication, culture and tourism, as well as marine and fishery. Culture and tourism are among the toppest business sectors that are more opened for foreign investor.

Business expansion : The investor is not obliged to establish a new legal entity or to obtain new license for expanding its business in the same field but in the different location. All they need is to fulfill the location requirement unless otherwise stipulated by the laws. This policy would expectedly to provide flexibility for the investor in expanding their business.

In the event that the foreign investor intends to expand its business within the same business line and the expansion needs additional capital through rights issue, and the local investor can not participate in its expansion scheme, then pre-emptive rights[1] applicable for foreign investor. In the event that the share ownership for foreign investor exceeds the maximum limitation as stated in the approval letter, the foreign investor should adjusted that exceeding within 2 (two) years. The Perpress 36/10 provides certain mechanism on how to adjust the exceeding shareownership as stated on article 6 (six) Paragraph 2 (two). The mechanism are (i) the foreign investor sell the exceeding shares to the local investor (ii) The foreign shareholder sell its exceeding shares through Initial Public Offering (IPO) carried out by the respective company through local capital market or (iii) The respective company which the foreign investor has exceeding his shareownership buys the exceeding shares and threated it as treasury stocks. The treasury stock is further stipulated in Indonesian Company Law No 40/2007.

Applicability of the new negative list to the Public Listed Company: This new negative list is not applicable for indirect investment or portfolio investment that the transaction carried out through local capital market. However, referring to the Director of Deregulation BKPM, Mr, Indra Darmawan, this provision is not applicable for those public listed companies which have foreign controlling shareholder that getting their shares through local capital market. In short, the new negative list will remain applicable for this situation. This policy is actually restatement of the investment law 25/2007 article 2. On its elucidation, the law stated that the investment law is applicable in all sectors in the territority of the Republic of Indonesia which means direct investments, not including indirect investment or portfolio investment.

Change of company ownership : In the event that the capital ownership changed due to merger, acquisition, or consolidation within the investment company engganges in the same line of business, limitation for foreign capital ownership applied as described below:

1. In the case of merger, the limitation of capital ownership for the surviving company is in accordance to the approval letter of its company;
2. In the case of acquisition, the limitation of capital ownership for the acquiring company is in accordance to the approval letter of its company;
3. In the case of consolidation, the limitation of capital ownership for the new company as is the provisions currently applicable for the new company resulted from consolidation in question.

Granfathering clause : Article 8 of Perpres 36/10 stated that this regulation is not applicable for those approved investment in certain business line issued prior to the enactment of Perpress 36/10. However, the provisions will remain applicable if deemed benefited to the investor. This provision is very important for the investor to protect them from uncertainty especially on the regulatory issue that tend to change. It is commonly known that the regulation is tend to change and this is somehow will hamper the investor in getting legal certainty while they’re doing their business in Indonesia.

Even the granfathering clause has clearly expressed by the Perpress, some uncertainty still many left. The biggest concern is how far this protection extends, that is negative list is only a Presidential Decree which the level in Indonesian regulation system is under the law (undang-undang). How if the new law (undang-undang) which is higher level then Presidential Decree is issued and conflicting to the negative list. If the law (undang-undang) is applied, the protection againts uncertainty is considerably weak because granfathering clause will only applicable for the same level of regulation or lower. There are still many questions surrounded within granfathering clause other than changing regulation like business expansion, domestic investment company (PMDN), public listed company issue, and etc. Therefore BKPM should anticipated this issue and the policy will continue to play a part.

Asean Economic Community, Amid the pressure to the globalised economy, the new negative list has showed government’s commitment toward ASEAN Economic Community by providing higher foreign percentages in certain sectors for investor from ASEAN countries. In addition, in the even that a business line contained in the Indonesia commitment toward ASEAN Economic Community is not listed in the attachment of the new negative list but listed in other attachment, that the investor from ASEAN countries may invest in accordance to the requirement provided by that attachments.

New Format : A very welcomed change of this new negative list is the format that is now simpler and much easier to understand. The new format covering 17 general business areas composed based on the sectors under the ministry or related government institution. The new negative list has already used the newest Business Clasification (KBLI 2009) as the reference code of business line in Indonesia.