Minimum Down Payments Regulated under New Guidelines on Procurements for the Preparation and Development of IKN

  • The National Public Procurement Agency (Lembaga Kebijakan Pengadaan Barang/Jasa Pemerintah – "LKPP") has amended Regulation of LKPP No. 5 of 2022 on Guidelines for the Provision of Infrastructure and Other Procurements of Goods/Services, Specifically Preparation, Development and Transfer-Related Activities for the State Capital City, as Well as the Organization of the Special Regional Government of Special Capital Region of Nusantara (Ibu Kota Nusantara/IKN) [collectively referred to "Guidelines"], through the issuance of Regulation of LKPP No. 3 of 2024 ("Amendment"), which has been in force since 26 July 2024.
  • The Amendment redefines the scope of the Guidelines, specifically: 1) Human resources for procurements of goods/services; 2) Types of procurements; 3) Packaging strategies; 4) Selection methods; 5) Contract types; 6) The empowerment of small business actors; 7) Use of local manpower and local materials; and 8) Down-payment amounts (this matter was not previously included).
  • In terms of the said down payments, the Amendment states that down-payment amounts for construction work, integrated design and build construction work for non-small businesses may be set at up to a maximum of 30% for single-year contracts and a maximum of 20% for multi-year contracts.
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  • The National Public Procurement Agency (Lembaga Kebijakan Pengadaan Barang/Jasa Pemerintah – "LKPP") has amended Regulation of LKPP No. 5 of 2022 on Guidelines for the Provision of Infrastructure and Other Procurements of Goods/Services, Specifically Preparation, Development and Transfer-Related Activities for the State Capital City, as Well as the Organization of the Special Regional Government of Special Capital Region of Nusantara (Ibu Kota Nusantara/IKN) [collectively referred to "Guidelines"], through the issuance of Regulation of LKPP No. 3 of 2024 ("Amendment"), which has been in force since 26 July 2024.
  • The Amendment redefines the scope of the Guidelines, specifically: 1) Human resources for procurements of goods/services; 2) Types of procurements; 3) Packaging strategies; 4) Selection methods; 5) Contract types; 6) The empowerment of small business actors; 7) Use of local manpower and local materials; and 8) Down-payment amounts (this matter was not previously included).
  • In terms of the said down payments, the Amendment states that down-payment amounts for construction work, integrated design and build construction work for non-small businesses may be set at up to a maximum of 30% for single-year contracts and a maximum of 20% for multi-year contracts.
......

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