INVESTMENT OPPORTUNITIES IN SPECIAL ECONOMIC ZONES

Special Economic Zone (SEZ) is an area designated by the Indonesian Government as a center for development of economic growth and equitable distribution, supporting industrialization and job creation especially for the surrounding areas.

To optimize its designation as a national strategic initiative, in accordance with Law No. 39 of 2009, businesses in SEZs receive facilities and facilitation, both in the form of fiscal incentives (such as certain tax exemptions, granting tax holidays and tax allowances for 10-20 years, exemption/suspension of import duties, reduction of local taxes) and non-fiscal incentives (such as single-window business licensing, longer period of building rights title, immigration facilitation related to the use of foreign labor, and others).

Since 2012, the Government has designated 20 SEZs spread throughout Indonesia. The sectors developed in each SEZ include manufacturing, services, tourism, education, and health.

SEZ policies open up highly beneficial long-term investment opportunities for both domestic and foreign investors. To optimize these investment opportunities, legal assistance is required for both the SEZ management bodies and businesses investing in SEZs. Various incentives in SEZs are based on and refer to various laws and regulations, as well as the agreement between the SEZ management bodies and businesses investing in SEZs.

This newsletter is for informational purposes only and solely intended to provide general information and should not be treated as legal advice, nor shall it be relied upon by any circumstance or create any relationship. All summaries of the laws, regulation and practice in the contents are subject to change. Specific legal advice should be sought by interested parties to address their particular circumstances.

If you have any question and/or wish to discuss further about the above or to discuss the impact of these legal and commercial developments in your particular case, please reach out to Cylvie at cylvie@sapartnerslaw.com and/or Sunu at sunu@sapartnerslaw.com.

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