Insights / Updates

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Indonesia Establishes its National Payment Gateway

The Indonesian central bank, Bank Indonesia ("BI") recently issued BI Regulation No. 19/8/PBI/2017 on National Payment Gateway ("BI Regulation") as part of its effort to actualize the independency of Indonesia's national payment system, especially in respect of all financial transactions carried-out in Indonesia. By issuing the BI Regulation, BI started the process to establish the National Payment Gateway ("NPG") which has two (2) key objectives: (i) the interconnectivity of all existing payment channels; and (ii) the interoperability of various payment instruments which are currently existing and used in Indonesia.

Amid Continuing Controversy, Minister Revisits Online Taxi Issue with New Regulation

Minister of Transportation Regulation No. PM 32 of 2016 on Unscheduled Public Transportation Services ("MOTR 32/2016"),issued on 1 April 2016 and came into force on 1 October 2016, clearly failed to resolve the tension between conventional taxi providers and the providers of app-based, online taxis. On one hand, conventional taxi providers argued that MOTR 32/2016 effectively legalized the operation of online taxis, while on the other hand, the online taxi providers complained that the regulation adversely affected their business model through such things as the requirement that their vehicles have a minimum of 1,300 cc and that they provide car pool facilities. These requirements, they argued, were akin to those applicable to conventional taxi providers. The intense competition to attract customers continued and even led to violence in several areas.

The Minister of Transportation has responded to the deficiencies inherent in MOTR 32/2016 by revoking and replacing it with Regulation No. PM 26 of 2017 on Unscheduled Public Transportation Services ("MOTR 26/2017"). MOTR 26/2017 was issued on 31 March 2017. The Minister presumably believes that MOTR 26/2017 is more accommodating to the demands of both parties.

Independent Power Producers Face Risks under New Power Purchase Regulation

The Minister of Energy and Mineral Resources recently issued Regulation No. 10 of 2017 on the Principles Governing Power Purchase Agreements ("MEMR 10") as part of its efforts to overcome persistent delays in the closing of Power Purchase Agreements ("PPA") between Independent Power Producers ("IPP"), the sellers of electricity, and state power utility Perusahaan Listrik Negara ("PLN"), as the buyer. From the Government's perspective, MEMR 10 is intended to provide greater certainty and thus help reduce the time needed for negotiating PPAs. The ultimate question, however, is whether MEMR 10 will actually expedite the signing of the PPAs or is it skewed to the benefit of PLN, thus potentially lessening the appetite of IPPs and their lenders to invest in projects promoted by PLN?