Foreign Investors' Increased Opportunities in Indonesia

A new Investment List broadens a number of sectors to foreign investment. The amount of restriction in foreign ownership sectors have been reduced. The new rules still require thorough analysis, because of the complexness of the regulations in context of the broader law reforms introduced by the Omnibus Law.

The long awaited new investment list has been published by the government, under Presidential Regulation No. 10 of 2021 regarding Investment Sectors. It has been effective on the 4th of March 2021, 30 days after it was announced. This highlights the revocation of the Presidential Regulation No. 76 of 2007 and Presidential Regulation No. 44 of 2016.

In general, the change between the New Investment List and the past list is not a radical one. But here are certain aspects and changes to take note of:

Telecommunications, media and technology is one of the sectors that is now relieved. This category was previously subject to a 67% foreign investment limit, but is no longer mentioned in the New Investment List.

The New Investment List now categorises business sectors open for investment, into four. There is also a new label of Prioritised Sectors (there are 245 of them) which covers certain areas such as those that are significant to nation strategy, those that are capital or labour intensive, those that require sophisticated technology, and industries that are pioneering, oriented towards export, research, development and innovation. Under certain conditions, these sectors are eligible for fiscal (tax and customs) incentives, and also non-fiscal incentives like simplified business licensing, supply of supportive infrastructure, energy supply or raw materials, immigration, workforce, and others.

For further information regarding the New Investment List, feel free to contact one of our partners directly.

wahyuyasser@consilium.lawyer