Indonesia is a vast country with a rapidly developing economy. The country has many investment opportunities, but not all investments are suitable for foreign investors. The Indonesian Investment Coordinating Board, or BKPM, maintains a list of negative investment sectors, which are closed to foreign investment. The latest version of this list, the BPKM Negative Investment List 2016, was issued in May 2016. In this article, we will explore what the BPKM Negative Investment List 2016 is, what sectors it covers, and what implications it has for foreign investors.
What is the BPKM Negative Investment List 2016?
The BPKM Negative Investment List 2016 is a list of sectors that are closed to foreign investment. It was issued by the Indonesian Investment Coordinating Board, or BKPM, in May 2016. The list is part of the wider framework of Indonesian investment regulations, which aim to regulate and promote investment in the country.
What sectors are covered by the BPKM Negative Investment List 2016?
The BPKM Negative Investment List 2016 covers a range of sectors. These sectors are divided into three categories: completely closed sectors, partially closed sectors, and sectors that are conditionally open to investment. Completely closed sectors are those where foreign investment is strictly prohibited. Partially closed sectors are those where foreign investment is subject to certain conditions or limitations. Conditionally open sectors are those where foreign investment is allowed, but subject to certain requirements.
The completely closed sectors are:
- Lottery
- Gambling
- Casinos
- Cockfighting
- Distribution of certain chemicals
- Production of certain chemicals
- Tourist guidance services
- Domestic waste management
- Broadcasting of terrestrial multiplexing
The partially closed sectors are:
- Forestry
- Plantation
- Livestock and animal husbandry
- Fisheries
- Energy and mineral resources
- Construction services
- Retail trading
- Car rental
- Restaurant and catering services
- Movie theaters
- Transportation
- Warehousing services
- Post and courier services
- Telecommunications
- Healthcare services
The conditionally open sectors are:
- Wholesale trading
- Education services
- Advertising services
- Tourism industry
- Hospitality industry
- Information technology
- Non-commercial research and development
- Construction consultancy services
- Architectural services
- Engineering services
- Law services
- Employment services
- Environmental services
- Consultancy services in waste management
- Consultancy services in water management
- Consultancy services in transportation
- Consultancy services in tourism
- Consultancy services in healthcare
- Consultancy services in social services
What are the implications of the BPKM Negative Investment List 2016 for foreign investors?
Foreign investors need to be aware of the BPKM Negative Investment List 2016 when considering investment opportunities in Indonesia. The list indicates which sectors are closed to foreign investment, and which sectors are partially or conditionally open to investment. Investing in a closed sector is strictly prohibited, and can result in penalties or even legal action.
Foreign investors who wish to invest in partially or conditionally open sectors need to be aware of the specific requirements and conditions that apply. These may include minimum investment amounts, restrictions on ownership or control, or other regulatory requirements. It is important for investors to seek professional advice and guidance to ensure compliance with all relevant regulations and requirements.
Conclusion
The BPKM Negative Investment List 2016 is an important regulatory tool that foreign investors need to be aware of when considering investment opportunities in Indonesia. The list indicates which sectors are closed to foreign investment, and which sectors are partially or conditionally open to investment. Investing in a closed sector is strictly prohibited, and can result in penalties or even legal action. Investors who wish to invest in partially or conditionally open sectors need to be aware of the specific requirements and conditions that apply, and should seek professional advice and guidance to ensure compliance with all relevant regulations and requirements.
