ISCO Definition of a CEO

On 29 February 2012, Minister of Manpower and Transmigration Decree No. 40 of 2012 on Restricted Positions for Foreign Workers (Decree) was issued to determine positions that are restricted for foreigners. The restricted positions are listed in the Appendix of the Decree (see ILB No. 1868 8 March 2012).

The Decree is controversial, because foreigners are restricted from becoming Chief Executive Officers (CEO). Businesses argue that restricting foreigners from becoming CEOs will cause investors to withdraw. However, the Minister of Manpower and Transmigration (Minister) justified the restriction by explaining that the term ‘CEO’ in the Decree should be interpreted as a human resources and administration manager under the International Standard Classification of Occupations (ISCO), not as the highest management position in a company.