Senin, Mei 20, 2024

Batam, Bintan and Karimun Included on List of Areas Classified as Developed Industrial Zones

In a bid to expedite the spread and even distribution of industrial development throughout the nation through the implementation of industrial zoning ("Zoning"), the government has issued Regulation No. 20 of 2024 on Industrial Zoning ("Regulation 20/2024"), which has been in force since 7 May 2024. While the enforcement of Regulation 20/2024 has consequently resulted in the repeal and replacement of Regulation of the Government No. 142 of 2015 on Industrial Zones ("Regulation 142/2015"), any implementing framework to the now-revoked Regulation 142/2015 will remain in force, provided that the provisions that feature therein are not in contradiction with any new provisions that have now been introduced under Regulation 20/2024.
At its core, Regulation 20/2024 states that Zoning should be implemented through the classification of certain regions across the nation into several Industrial Development Zones (Wilayah Pengembangan Industri – "WPI"). In this regard, the aforesaid WPI should be further developed by central and/or regional governments through the development of the following areas: 1) Central industrial development zones (Wilayah Pusat Pertumbuhan Industri/WPPI); 2) Industrial-oriented zones (Kawasan Peruntukan Industri/KPI); 3) Industrial zones; and 4) Centres for small- and medium-scale industries.
While the majority of the various WPI regions and categories that originally featured under the framework of Regulation 142/2015 have been retained (and which range from Developed to Potential II WPI), Regulation 20/2024 has now included North Sumatra alongside the Batam, Bintan and Karimun regions within the Developed WPI classification. Moreover, the WPI for any newly formed provinces should adhere to the WPI classification of the relevant original provinces.
While Regulation 142/2015 stated that industrial zone companies and industrial companies were entitled to enjoy various taxation and regionally-related incentives, Regulation 20/2024 has now expanded these incentives to also include fiscal incentives (i.e. taxation and customs facilities) and non-fiscal incentives (e.g. immigration, land and manpower related facilities).

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In a bid to expedite the spread and even distribution of industrial development throughout the nation through the implementation of industrial zoning ("Zoning"), the government has issued Regulation No. 20 of 2024 on Industrial Zoning ("Regulation 20/2024"), which has been in force since 7 May 2024. While the enforcement of Regulation 20/2024 has consequently resulted in the repeal and replacement of Regulation of the Government No. 142 of 2015 on Industrial Zones ("Regulation 142/2015"), any implementing framework to the now-revoked Regulation 142/2015 will remain in force, provided that the provisions that feature therein are not in contradiction with any new provisions that have now been introduced under Regulation 20/2024.
At its core, Regulation 20/2024 states that Zoning should be implemented through the classification of certain regions across the nation into several Industrial Development Zones (Wilayah Pengembangan Industri – "WPI"). In this regard, the aforesaid WPI should be further developed by central and/or regional governments through the development of the following areas: 1) Central industrial development zones (Wilayah Pusat Pertumbuhan Industri/WPPI); 2) Industrial-oriented zones (Kawasan Peruntukan Industri/KPI); 3) Industrial zones; and 4) Centres for small- and medium-scale industries.
While the majority of the various WPI regions and categories that originally featured under the framework of Regulation 142/2015 have been retained (and which range from Developed to Potential II WPI), Regulation 20/2024 has now included North Sumatra alongside the Batam, Bintan and Karimun regions within the Developed WPI classification. Moreover, the WPI for any newly formed provinces should adhere to the WPI classification of the relevant original provinces.
While Regulation 142/2015 stated that industrial zone companies and industrial companies were entitled to enjoy various taxation and regionally-related incentives, Regulation 20/2024 has now expanded these incentives to also include fiscal incentives (i.e. taxation and customs facilities) and non-fiscal incentives (e.g. immigration, land and manpower related facilities).

......