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Indonesia Quarterly Regulatory Updates – February To April 2022 – Government Contracts, Procurement & PPP



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We provide herein the executive summary of 19 newly enacted
regulations in Indonesia issued between February and April
2022.

















General Corporate
Sector
No Regulation Summary
1.

Business Competition Supervisory Commission (Komisi Pengawas
Persaingan Usaha
or “KPPU“) No. 1
of 2022 on Business Competition Compliance Program
(“KPPU Reg. 1/2022“)


Enforcement Date: 24 March 2022

  • To increase compliance with the competition law, and to prevent
    monopoly and unhealthy business practices, KPPU has implemented a
    guideline on business competition compliance program
    (“Compliance Program“), in effect since
    2016. KPPU Reg. 1/2022 is issued to accommodate the program
    implementation. Business actors that:

    1. have joined the Compliance Program but have not been registered
      at KPPU; and

    2. have not joined the Compliance Program


  • can register their relevant businesses
    to the Head of KPPU.

  • Compliance Program contains: 1) Code of Ethics; 2) Compliance
    guide; 3) socialization, training, or other activities regarding
    the program implementation. Business actors must report the
    implementation of their program to KPPU to be evaluated at KPPU
    hearings.

  • If approved, KPPU will issue the Compliance Program
    Stipulation, which is valid for five years and can be
    extended.

  • KPPU may relax the sanctions or fines against business actors
    who have registered their Compliance Program.

Manpower Sector
2.

Minister of Manpower (“MoM“) Circular
Letter No. M/2/HK.04/IV/2022 on Revocation of MoM Circular Letter
No. M/3/HK.04/III/2020 on Protection of Workers/Laborers and
Business Continuity to Prevent and Mitigate the Spread of COVID-19
(“MoM Circular Letter No. 2/2022“)


Enforcement date: 6 April 2022

  • MoM Letter No. 2/2022 revokes MoM Circular No.
    M/3/HK.04/III/2020 on measures to protect workers and current
    businesses in the middle of Covid-19 situation, which are: 1)
    efforts to prevent the spread of Covid-19 cases in a workplace
    environment; 2) wage protection for workers during the pandemic
    (workers who are ODP or Person Under Observation, or those who are
    confirmed to have Covid-19 still maintain their rights to take
    leaves, receive their wages, and have their pays adjusted according
    to prior agreements between the Company/Employer and the
    workers).

  • As the pandemic has been under control through, among other
    measures, vaccination programs, easing of business restrictions,
    relaxation of business actors’ obligations, as well as easing
    of health protocols leading to the economic recovery, measures to
    protect workers and businesses are no longer applicable and are
    terminated.

3.

MoM Circular Letter No. M/3/HK.04/IV/2022 on Implementation of
Joint Leave by Companies (“MoM Circular Letter No.
3/2022
“)


Enforcement date: 14 April 2022

  • In MoM Circular Letter No. 3/2022, MoM elaborates the
    implementation of joint leave in a Company.

  • Joint leave is a part of workers’ annual leave. Its
    implementation shall be based on the agreement between the Company
    and the workers and/or worker unions, company regulation,
    employment agreement, collective labour agreement, as well as other
    conditions in line with the company’s operational needs.

  • The period of annual leave will be reduced when the workers
    take their leaves during the joint leave period. On the contrary,
    workers who work during the joint leave period will not have their
    leave period reduced, and they must receive their pays as they work
    on normal working days.

4.

Letter of the Director-General of Development of Industrial
Relations and Social Security of Workers No.
4/303/HI.00.03/III/2022 on Notification Documents and Termination
of Employment Relationship Report (“Letter No.
4/2022
“)


Enforcement date: 11 March 2022

  • Letter No. 4/2022 provides a standard of reporting mechanism
    regarding termination of employment in terms of the documents,
    employee’s response letter, application form to be submitted to
    the Manpower Office, and receipt issued by the Manpower
    Office.

  • If the employment termination is unavoidable, the employer must
    notify the relevant workers and/or workers union with the reasons
    of termination, at least, 14 days before the termination. If the
    workers accept the termination, the employer must report it to MoM
    or the relevant provincial/local Manpower Office to obtain the
    official receipt.

5.

Letter of the Social Security Agency for Employment No.
B/1409/032022 on Limits of Maximum Wages and Pension Benefits for
the Year 2022 (“Social Security Agency Letter No.
1049/2022
“)


Enforcement date: 1 March 2022

  • According to the Central Bureau of Statistics (“Badan
    Pusat Statistik or BPS“), the inflation rate
    in 2021 is 1.87% and the growth of Indonesian Gross Domestic
    Product (“GDP“) in 2021 has increased by
    3.69%. As a result, Manpower BPJS has adjusted the amount of: 1)
    minimum pension benefit to IDR 363,000/month; 2) maximum pension
    benefit to IDR 4,357,900/month; and 3) highest wage limit as the
    basis for insurance payment calculation to IDR
    9,077,600/month.

  • The updated adjustments have come into effect since March 2022
    payment period.

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The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.

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