Insights / Updates

Stay up to date with legal developments in Indonesia.

What's New

A New Standard to Convict Defendants in Corruption Cases

In light of the disparity of the decisions rendered by the Indonesian courts in relation to corruption cases, the Indonesian Supreme Court recently enacted Supreme Court Regulation No. 1 of 2020 ("Regulation No. 1 of 2020") to provide a standardised and fair benchmark in convicting defendants for corruption under Articles 2 and 3 of the Anti-Corruption Law ("Anti-Corruption Law").

Under Regulation No. 1 of 2020,the court should sequentially consider the following six aspects to determine conviction for violation of Articles 2 and 3:

  1. the amount of loss suffered by the state;
  2. the scale of the crime, impact and benefits enjoyed by the defendant;
  3. the term of imprisonment;
  4. any incriminating and alleviating conditions;
  5. the criminal conviction; and
  6. any other provisions relating to a criminal conviction.
Notification Procedure Simplified, and Asset Notification Clarified

The new Indonesian merger regulation, 2019 Merger Regulation, requires businesses to notify their asset transactions to the Indonesia Competition Commission or the KPPU. However, the lack of clarity on various technical aspects for the notification has caused different interpretations to emerge. This prompts businesses to informally consult with KPPU to obtain its confirmation, which is impractical and time-consuming.

At the end of July 2020, KPPU held a public webinar to discuss asset acquisitions from a merger control perspective, as part of its effort to clarify the scope of the asset acquisition notification. At the webinar, KPPU clarified the asset acquisition exemptions, as well as simplified the merger notification procedure.

Exempted Asset Acquisitions - KPPU confirmed that an asset acquisition that satisfies one of the following criteria would not trigger a mandatory notification post-acquisition to KPPU:

(i) The value of the asset acquisition is below the transaction value threshold. Businesses that have an asset acquisition valued at less than IDR 250 billion (for businesses in non-banking industries) or IDR 2.5 trillion (for businesses in the banking industry) do not need to notify KPPU of such asset acquisition.

(ii) The asset acquisition is not part of the ordinary course of business.

(iii) The acquired asset is intended for a specific use.

(iv) The use of the acquired asset is unrelated to the acquirer's business activities.

Simplified Notification Procedure - KPPU also simplified the merger notification procedure for eligible transactions to expedite the notification procedure.

KPPU confirmed that the exemption and the simplification of notification procedure would be covered in the implementing guidelines for the 2019 Merger. The guidelines, which are currently being finalised by KPPU, will be released in due course.

Government Cuts Red Tape to Pave the Way for Covid-19 Vaccine

As seen from the many regulations issued since the declaration of COVID-19 as a public health emergency, the Indonesian government has been rolling out various measures to protect the country and its citizens. Most recently, the government issued Presidential Regulation No. 77 of 2020 on the Procedures to Implement Patents by the Government ("New Regulation"), which is the implementing regulation of Law No. 13 of 2016 on Patents.

In the past, the procedure to implement patents by the government was governed by Government Regulation No. 27 of 2004 (“Regulation No. 27 of 2004”) as mandated by the old patent law (Law No. 14 of 2001 on Patent). Pursuant to Regulation No. 27 of 2004, the government then issued Presidential Regulation No. 76 of 2012 on the Implementation of Patent by the Government for Antiviral and Anti-Retroviral Medicines, which was enacted to meet the urgent demand and need for antiviral and anti-retroviral medicines to treat HIV/AIDS and Hepatitis B.

In light of the current pandemic, the New Regulation aims to eliminate bureaucratic red tapes to ensure that when a COVID-19 vaccine becomes available, the government can immediately implement the patent.  Under the New Regulation, the government can implement a patent if the patent relates to Indonesia's national defence and security or in the event of an urgent public needs, which includes the need for pharmaceutical or biotechnological products that may potentially be expensive or necessary to treat diseases that can adversely affect the general rate of mortality.