The Impact of Negative Investment List (NIL) Introduction on Investment Decisions of Foreign and Domestic Investors in Indonesia

Tatiara, Wildatul Fitri; Kudo, Toshihiro

doi:10.46456/jisdep.v2i2.151

Cited by 2 publications

(2 citation statements)

References 14 publications

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“…Firstly, NILs will determine the openness of a certain business sector to foreign investment. 26 Secondly, NILs can determine the magnitude of the flow of investment. The greater the restrictions of foreign investment imposed in a particular sector, the lower the flow of investment will be.…”

Section: Resultsmentioning

confidence: 99%

Legal Uncertainty Of Foreign Share Ownership In The Construction Services Sector

Yogaswara

2023

JULR

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<p>This article is written to analyze the legal uncertainties found in the positive regulation related to the foreign ownership limitation in the construction services sector. In 2020, the Indonesian government issued the Job Creation Law which changed several laws and regulations including the Investment Law. According to the amended Investment Law, provisions regarding investment requirements are further regulated in a Presidential Regulation, in this case Perpres 10/2021 and Perpres 49/2021. However, both regulations do not stipulate any foreign ownership limitation in the construction services sector and the foreign ownership limitation regulated under other regulations instead. The most suitable method for this research is the normative juridical method, which is therefore used in this article. Until the writing of this article, there has been no research that examines the same subject matter, so the authors assess the importance of conducting this research. After this research was performed, it was found that legal uncertainty regarding restrictions on foreign shares in the construction services sector was found in the appendix of PP 5/2021 with the foreign ownership limitation for ASEAN BUJKA of 70% and Non-ASEAN BUJKA of 67%.</p>

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Section: Resultsmentioning

confidence: 99%

Legal Uncertainty Of Foreign Share Ownership In The Construction Services Sector

Yogaswara

2023

JULR

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“…Restrictions on business fields for foreign investors are carried out in several ways, including listing business fields that are closed to foreign investors on the negative investment list, determining the maximum share ownership limit, requiring partnerships with MSMEs, limiting locations permitted for foreign investment, and requiring special permits. 75 Third, Indonesia sets a minimum total investment for FDI companies of 10 billion rupiah excluding land and buildings per business field per location.…”

Section: The Benefitmentioning

confidence: 99%

Comparative Analysis of Indonesia’s Minimum Capital Requirements for Foreign Direct Investment

Putri,

Imarhiagbe,

Mandira

et al. 2023

LeSRev

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This research seeks to examine the compatibility of the Indonesian minimum capital requirement for foreign direct investment companies (FDI) with the national treatment obligation under international investment agreements (IIAs). The requirement is compared with investment requirements under Australian and Austrian Law. This research combines the normative legal research method with law and economics by conducting cost and benefit analysis (CBA). The national treatment protects foreign investors from less favorable treatment against domestic investors. The minimum capital requirement is contrary to national treatment because it is only applicable to FDI companies. However, not every IIA involving Indonesia provide a national treatment clause. To determine violation, the two-tier test must be conducted by analyzing the scope of the obligation and applicable exception. Some IIAs provide exceptions where a state can give different treatment to foreign investors for the sake of public interest. Indonesia justifies this requirement because it gives several benefits namely preventing foreign investors from controlling vital sectors, protecting MSMEs from unfair competition, and ensuring liquidity. Nevertheless, the benefits cannot be achieved due to weak supervision. The requirement can be easily circumvented through nominee agreements. Based on CBA, the requirement creates more harm than good. It is promiscuously applied to all business fields and is more burdensome compared to investment requirements in Australia and Austria. The solution proposed is either improving supervision or adjusting the requirement to be more consistent with the national treatment. The government can also protect national interests by empowering MSMEs and using more relevant criteria.

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The Impact of Negative Investment List (NIL) Introduction on Investment Decisions of Foreign and Domestic Investors in Indonesia

Cited by 2 publications

References 14 publications

Legal Uncertainty Of Foreign Share Ownership In The Construction Services Sector

Legal Uncertainty Of Foreign Share Ownership In The Construction Services Sector

Comparative Analysis of Indonesia’s Minimum Capital Requirements for Foreign Direct Investment

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