Jumat, September 6, 2024

Government Set to Complete Revision of Cooperatives Law

The Minister of Cooperatives and Small and Medium Enterprises, Teten Masduki ("Minister"), has revealed that the government is currently focusing on finalizing the ongoing revision of Law No. 25 of 1992 on Cooperatives, as amended by Law No. 4 of 2023 ("P2SK Law") on the Development and Strengthening of the Financial Sector (collectively referred to as "Cooperatives Law").
In this regard, the Minister has highlighted the critical need for a revised framework that will cover the cooperatives sector, an area of the economy that has not been addressed for over 25 years. The Minister has also expressed concern regarding the risks that may arise from problematic cooperatives if the current outdated legal framework is not modernized.
During a recent meeting that was held with the newly appointed Minister of Law and Human Rights, Supratman Andi Agtas, President Widodo’s prioritization of the revision was discussed. The delayed passing of the forthcoming Draft Bill on the Amendment to the Cooperatives Law has been attributed to issues surrounding the Indonesian Cooperatives Council (Dewan Koperasi Indonesia – "Dekopin"). In this context, the Minister has clarified that while Dekopin is not set to be eliminated in the revision, the body will ultimately be restructured in order to bring it into line with a more sector-based cooperative management regime.
The revision is seen as a critical part of the overall reform of the oversight of cooperatives, which is currently reliant on internal monitoring, a model that is widely believed to be inadequate for larger cooperatives. In this regard, the revision includes proposals for external supervision and the establishment of a Deposit Insurance Agency (Lembaga Penjamin Simpanan/LPS) for cooperatives.
In addition, the Ministry of Cooperatives and Small and Medium Enterprises ("Ministry") is aiming to strengthen the overall role that cooperatives play within the national economy by encouraging multi-stakeholder cooperatives that are better able to integrate cooperatives into production chains. The Ministry will also promote the implementation of the P2SK Law this year, which addresses both open-loop and closed-loop cooperatives. _(ANT)

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The Minister of Cooperatives and Small and Medium Enterprises, Teten Masduki ("Minister"), has revealed that the government is currently focusing on finalizing the ongoing revision of Law No. 25 of 1992 on Cooperatives, as amended by Law No. 4 of 2023 ("P2SK Law") on the Development and Strengthening of the Financial Sector (collectively referred to as "Cooperatives Law").
In this regard, the Minister has highlighted the critical need for a revised framework that will cover the cooperatives sector, an area of the economy that has not been addressed for over 25 years. The Minister has also expressed concern regarding the risks that may arise from problematic cooperatives if the current outdated legal framework is not modernized.
During a recent meeting that was held with the newly appointed Minister of Law and Human Rights, Supratman Andi Agtas, President Widodo’s prioritization of the revision was discussed. The delayed passing of the forthcoming Draft Bill on the Amendment to the Cooperatives Law has been attributed to issues surrounding the Indonesian Cooperatives Council (Dewan Koperasi Indonesia – "Dekopin"). In this context, the Minister has clarified that while Dekopin is not set to be eliminated in the revision, the body will ultimately be restructured in order to bring it into line with a more sector-based cooperative management regime.
The revision is seen as a critical part of the overall reform of the oversight of cooperatives, which is currently reliant on internal monitoring, a model that is widely believed to be inadequate for larger cooperatives. In this regard, the revision includes proposals for external supervision and the establishment of a Deposit Insurance Agency (Lembaga Penjamin Simpanan/LPS) for cooperatives.
In addition, the Ministry of Cooperatives and Small and Medium Enterprises ("Ministry") is aiming to strengthen the overall role that cooperatives play within the national economy by encouraging multi-stakeholder cooperatives that are better able to integrate cooperatives into production chains. The Ministry will also promote the implementation of the P2SK Law this year, which addresses both open-loop and closed-loop cooperatives. _(ANT)

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