INDONESIA
Since March 2016
Pillar Foreign Direct Investment (FDI) in sectors relevant to digital trade |
Indicator Commercial presence requirement for digital services providers
Ministry of Communication and Informatics Circular Letter No. 3/2016
The Ministry of Communications and Informatics issued Circular Letter No. 3/2016 on 31 March 2016, establishing the regulatory framework for the delivery of application and content services via the Internet, commonly referred to as Over the Top (OTT) Services. The Circular categorises OTT Services into two main types. The first, OTT Application Services, involves the use of internet protocol-based telecommunications networks to provide functions such as text messaging, voice and video calls, online chatting, financial transactions, data storage, gaming, social networking, and related services. The second, OTT Content Services, encompasses the provision of digital information in formats such as text, sound, images, animations, videos, music, films, and games, delivered via streaming or downloads over telecommunications networks.
According to Section 5.3 of the Circular, foreign individuals or business entities may provide OTT Services only if they establish a Permanent Business Entity in Indonesia, in compliance with the country’s prevailing tax regulations. Furthermore, the Circular imposes specific obligations on OTT Service Providers, including the mandatory use of Indonesia’s National Payment Gateway and Indonesian internet protocol numbers (Sections 5.5.5 and 5.5.6).
According to Section 5.3 of the Circular, foreign individuals or business entities may provide OTT Services only if they establish a Permanent Business Entity in Indonesia, in compliance with the country’s prevailing tax regulations. Furthermore, the Circular imposes specific obligations on OTT Service Providers, including the mandatory use of Indonesia’s National Payment Gateway and Indonesian internet protocol numbers (Sections 5.5.5 and 5.5.6).
Coverage OTT services
Sources
- https://web.archive.org/web/20210226131032/https://www.kominfo.go.id/content/detail/7194/siaran-pers-no28pihkominfo32016-tentang-surat-edaran-nomor-3-tahun-2016-terkait-penyediaan-layanan-aplikasi-dan...
- https://web.archive.org/web/20241202174706/https://www.lexology.com/library/detail.aspx?g=d8ac6047-1dcc-47d0-a1b8-9914dadc9135
- https://web.archive.org/web/20231220171931/https://www.lexology.com/library/detail.aspx?g=44d84bcc-652d-4a5a-a3e3-4778fae2e383
- https://web.archive.org/web/20241202205816/https://www.makarim.com/news/the-government-of-indonesia-has-finally-regulated-over-the-top-services
- Show more...
INDONESIA
Since June 1997, entry into force in September 1997
Pillar Intellectual Property Rights (IPRs) |
Indicator Participation in the Patent Cooperation Treaty (PCT)
Patent Cooperation Treaty
Indonesia is a party to the Patent Cooperation Treaty (PCT). However, the country does not consider itself bound by Art. 59 related to disputes.
Coverage Horizontal
INDONESIA
Since October 2014
Pillar Intellectual Property Rights (IPRs) |
Indicator Copyright law with clear exceptions
Law of the Republic of Indonesia No. 28 of 2014 on Copyright (Undang-undang (UU) No. 28 Tahun 2014)
Indonesia has a copyright regime under the Law of the Republic of Indonesia No. 28 of 2014 on Copyright. However, the exceptions do not follow the fair use or fair dealing model, therefore limiting the lawful use of copyrighted work by others. Art. 43 lists the exceptions, which include publication, distribution, communication, and/or reproduction of State emblems and national anthems in accordance with their original nature; the production and distribution of the Copyrighted content through information technology and communication media that are not commercial and/or lucrative for the Author or related parties, or the Author expresses no objection to the manufacture and dissemination in question; among others.
Coverage Horizontal
INDONESIA
Reported in 2020, last reported in 2023
Pillar Intellectual Property Rights (IPRs) |
Indicator Enforcement of copyright online
Lack of adequate enforcement of copyright online
Copyright is not adequately enforced online in Indonesia. It is reported that online piracy through piracy devices and applications is a concern, and unauthorised camcording and unlicensed use of software remain problematic.
Coverage Horizontal
INDONESIA
Since December 1996, entry into force in March 2002
Pillar Intellectual Property Rights (IPRs) |
Indicator Adoption of the WIPO Copyright Treaty
WIPO Copyright Treaty
Indonesia has ratified the World Intellectual Property Organization (WIPO) Copyright Treaty.
Coverage Horizontal
INDONESIA
Since December 1996, entry into force in February 2005
Pillar Intellectual Property Rights (IPRs) |
Indicator Adoption of the WIPO Performances and Phonograms Treaty
WIPO Performances and Phonograms Treaty
Indonesia has ratified the World Intellectual Property Organization (WIPO) Performances and Phonograms Treaty.
Coverage Horizontal
INDONESIA
Since January 2014
Pillar Public procurement of ICT goods and online services |
Indicator Other limitations on foreign participation in public procurement
Ministry of Industry Regulation No. 02/M-IND/PER/1/2014 (Peraturan Menteri Perindustrian 02/M-IND/PER/1/2014)
The Ministry of Industry Regulation No. 02/M-IND/PER/1/2014, issued on 13 January 2014, replaced Regulation No. 15/M-IND/PER/2/2011 and introduced restrictions on public procurement to promote the use of domestic products. The regulation establishes a framework for categorising public goods and services based on the Domestic Component Level (TKDN) and the Company Utilization Point Rating (BMP), which evaluates suppliers' investments in Indonesia. The BMP considers factors such as support for micro and small enterprises, compliance with work, health, and environmental safety standards, and possession of a quality management certificate (Art. 1(8) of the regulation).
According to Art. 6, goods are classified into three categories based on the cumulative scores of TKDN and BMP:
- Obligatory Goods: These must have a cumulative score of over 40%, including at least 25% of TKDN.
- Maximised Goods: These must have a cumulative score of over 40%, including at least 15% of TKDN.
- Empowered Goods: These must achieve a TKDN score of at least 10%.
According to Art. 6, goods are classified into three categories based on the cumulative scores of TKDN and BMP:
- Obligatory Goods: These must have a cumulative score of over 40%, including at least 25% of TKDN.
- Maximised Goods: These must have a cumulative score of over 40%, including at least 15% of TKDN.
- Empowered Goods: These must achieve a TKDN score of at least 10%.
Coverage Horizontal
INDONESIA
Since October 2019
Pillar Intellectual Property Rights (IPRs) |
Indicator Mandatory disclosure of business trade secrets such as algorithms or source code
Government Regulation No. 71/2019 on the Provision of Electronic System and Transaction (Peraturan Pemerintah (PP) Nomor 71 Tahun 2019 Penyelenggaraan Sistem dan Transaksi Elektronik)
Government Regulation No. 71/2019 mandates that providers of bespoke software must either provide or escrow the source code associated with their services. This requirement has been in effect since the introduction of Government Regulation No. 82/2012, which was later replaced by Regulation No. 71/2019.
Coverage Software
Sources
- https://web.archive.org/web/20220809233205/http://jdih.kominfo.go.id/produk_hukum/view/id/6/t/peraturan+pemerintah+republik+indonesia+nomor+82+tahun+2012
- https://web.archive.org/web/20230322005029/https://peraturan.bpk.go.id/Home/Details/122030/pp-no-71-tahun-2019
- https://web.archive.org/web/20230909231646/https://www.itic.org/dotAsset/9d22f0e2-90cb-467d-81c8-ecc87e8dbd2b.pdf
- Show more...
INDONESIA
Since March 2018, last amended in February 2021
Pillar Public procurement of ICT goods and online services |
Indicator Other limitations on foreign participation in public procurement
Regulation of the President of the Republic of Indonesia No. 16 of 2018 on Government Procurement
Art. 67 of Presidential Regulation No. 16/2018 provides that a price preference applies to goods procurement with a maximum of 25%. For construction works under the international tender selection method, the price preference is given to a maximum of 7.5% to national business entities above the lowest bid price of foreign business entities. The price preference applies to procurement having a value of more than Rp one billion (approx. USD 67,000).
Coverage Horizontal
INDONESIA
Since December 2000
Pillar Intellectual Property Rights (IPRs) |
Indicator Effective protection covering trade secrets
Law of the Republic of Indonesia No. 30 of 2000 on Trade Secrets (Undang-Undang Republik Indonesia Nomor 30 Tahun 2000 Tentang Rahasia Dagang)
Law of the Republic of Indonesia No. 30 of 2000 on Trade Secrets provides a framework for effective protection of trade secrets. According to Art. 1 of the law, trade Secrets are legally defined as information in the field of technology and/or business that is not known by the public and has economic value as it is useful in business activities, and the confidentiality of which is maintained by its owner. Any person who deliberately and without rights uses the Trade Secret of another party or conducts any acts as referred to in Arts. 13 and 14 shall be sentenced to imprisonment of at most two years and a fine.
However, it is reported that it is necessary to prove that the suspected party has unlawfully obtained the trade secret. Proving this may be difficult as the litigation procedure is not equipped with a discovery procedure to uncover relevant evidence of the suspected party. It may help if the trade secret holder can prove that the local company had some form of relationship previously with it or was previously given access to the trade secret.
However, it is reported that it is necessary to prove that the suspected party has unlawfully obtained the trade secret. Proving this may be difficult as the litigation procedure is not equipped with a discovery procedure to uncover relevant evidence of the suspected party. It may help if the trade secret holder can prove that the local company had some form of relationship previously with it or was previously given access to the trade secret.
Coverage Horizontal
INDONESIA
Since May 2009
Pillar Public procurement of ICT goods and online services |
Indicator Other limitations on foreign participation in public procurement
Ministry of Industry Regulation No. 49/2009
The Ministry of Industry Regulation No. 49/2009 requires the use of domestic products and services in 558 sub-sectors for public procurement. The mandate to use domestic products in these sub-sectors applies if there are goods and services with minimum local content requirements ranging from 15% up to 96%. Domestic products and services are defined as goods or services produced or prepared by a company investing and producing in Indonesia, with the possibility to use imported raw materials or components in the production or working process.
Coverage 558 sub-sectors
INDONESIA
N/A
Pillar Telecom infrastructure & competition |
Indicator Passive infrastructure sharing obligation
Requirement of passive infrastructure sharing
It is reported that there is an obligation for passive infrastructure sharing in Indonesia to deliver telecom services to end users.
Coverage Telecommunications sector
INDONESIA
Since October 2019
Pillar Public procurement of ICT goods and online services |
Indicator Other limitations on foreign participation in public procurement
Ministry of Communication and Information Technology Regulation (MOCI) No. 12/2019
The Ministry of Communications and Informatics Regulation No. 12/2019, which replaces Regulation No. 41/PER/M.KOMINFO/10/2009 by the Ministry of Communication and Information Technology mandates that Indonesian telecommunication operators allocate at least 50% of their total capital expenditures for network development to locally sourced components or services. The regulation also stipulated that any telecommunication device/material which contains a minimum of 50% local component will be considered to have 100% local component (Art. 6). The regulation also requires companies to report the percentage of local content procured annually and have that information “authenticated” by the government or a survey institute appointed by the government. These requirements have been in place since 2009.
Coverage Network telecommunication operators
Sources
- https://web.archive.org/web/20231129225337/https://ustr.gov/sites/default/files/2013-14%20-1377Report-final.pdf
- https://web.archive.org/web/20231001091618/https://jdih.kominfo.go.id/produk_hukum/view/id/399/t/peraturan+menteri+komunikasi+dan+informatika+nomor+41permkominfo102009+tanggal+16+oktober+2009
- https://web.archive.org/web/20230326114326/https://jdih.kominfo.go.id/produk_hukum/view/id/713/t/peraturan+menteri+komunikasi+dan+informatika+nomor+12+tahun+2019+tanggal+25+oktober+2019
- Show more...
INDONESIA
Since June 2003, last amended in 2022
Since February 2021, last amended in May 2021
Since March 2013, last amended in February 2021
Since February 2021, last amended in May 2021
Since March 2013, last amended in February 2021
Pillar Telecom infrastructure & competition |
Indicator Maximum foreign equity share for investment in the telecommunication sector
Law of the Republic of Indonesia No. 19 of 2003 Concerning State-owned Enterprises (Undang-Undang Republik Indonesia Nomor 19 Tahun 2003 Tentang Badan Usaha Milik Negara)
Presidential Regulation No. 10 of 2021 on Business Fields Open to Investment (Peraturan Presiden Republik Indonesia Nomor 10 Tahun 2021 Tentang Bidang Usaha Penanaman Modal)
Regulation of The Government of the Republic of Indonesia No. 15 of 2013 on Implementation of Law No. 38 of 2009 on Post (Peraturan Pemerintah Republik Indonesia Nomor 15 Tahun 2013 Tentang Pelaksanaan Undang-Undang Nomor 38 Tahun 2009 Tentang Pos)
Presidential Regulation No. 10 of 2021 on Business Fields Open to Investment (Peraturan Presiden Republik Indonesia Nomor 10 Tahun 2021 Tentang Bidang Usaha Penanaman Modal)
Regulation of The Government of the Republic of Indonesia No. 15 of 2013 on Implementation of Law No. 38 of 2009 on Post (Peraturan Pemerintah Republik Indonesia Nomor 15 Tahun 2013 Tentang Pelaksanaan Undang-Undang Nomor 38 Tahun 2009 Tentang Pos)
According to Presidential Regulation No. 10/2021, the telecommunications sector was liberalised, allowing full foreign ownership of telecommunication service providers and telecommunication towers. However, according to Art. 1.2 and 77 of the State-owned Enterprises Act 19/2003, there is a limit of 49% on the shares that can be acquired by foreign investors in government-controlled firms. This includes foreign participation in state-owned entreprisese (SOEs) in the telecommunication sector, as regulated in Government Regulation No. 15/2013, amended by Government Regulation No. 41/2021.
Coverage State-owned entreprises in the telecom sector
Sources
- https://web.archive.org/web/20230928012412/https://peraturan.bpk.go.id/Download/32159/UU%20Nomor%2019%20Tahun%202003.pdf
- https://web.archive.org/web/20221205050600/https://www.telkom.co.id/data/image_upload/page/1664089743088_E.2.5%20Indonesian%20State-Owned%20Entities%20Act%20No.19%20of%202003.pdf
- https://web.archive.org/web/20240405063913/https://peraturan.bpk.go.id/Download/154474/Perpres%20Nomor%2010%20Tahun%202021.pdf
- https://web.archive.org/web/20240822114016/https://peraturan.bpk.go.id/Download/33450/PP%20Nomor%2015%20Tahun%202013.pdf
- https://web.archive.org/web/20241126144739/https://jdih.kominfo.go.id/storage/files/1574059156-_JDIH_6_GR_No_15_of_2013_on_Implementation_of_Law_No_38_of_2009_on_Post.pdf
- https://sim.oecd.org/Simulator.ashx?lang=En&ds=STRI&d1c=tc&d2c=idn&mc=39400:yes
- https://web.archive.org/web/20230330050336/https://investmentpolicy.unctad.org/investment-policy-monitor/measures/3660/indonesia-releasing-positive-list-of-investment
- Show more...
INDONESIA
Since March 2016
Pillar Public procurement of ICT goods and online services |
Indicator Other limitations on foreign participation in public procurement
Ministry of Industry Regulation No. 15/M-IND/PER/3/2016
Art. 6 of the Ministry of Industry Regulation 15/M-IND/PER/3/2016 stipulates that transmission towers and steel-reinforced conductors used in public procurement require a minimum local content of 40%.
Coverage Transmission towers and steel-reinforced conductors
