City to revise bylaws, decrees on outdoor advertising

Leony Aurora , The Jakarta Post, Jakarta

In a bid to simplify and improve regulations on outdoor advertising, a new set of bylaws and gubernatorial decrees will be introduced next year.

The current set, including Bylaw No. 8/1988 and Gubernatorial Decree No. 74/2000 along with about 18 other documents, cannot accommodate market needs and are not optimal, said Gunadi Soekemi of the Association of Indonesian Outdoor Media Companies (AMLI) at a seminar on Monday.

The seminar was held by the assets bureau of the Jakarta administration to gather input from outdoor ad agencies and associations in order to improve the regulation.

The associations asked the administration to consider eliminating the strategic value tax imposed on billboards placed in strategic areas because this was regarded as double taxation, since advertisement tax was also imposed on them.

The Outdoor Advertising Association of Indonesia's (OAAI) head of marketing and communication Gabriel Mahal said that the double taxation created the perception among ad agencies that outdoor advertising was expensive.

"That's one of the reasons why the share for outdoor ads spending of the whole advertisement cake is projected to decline by 0.2 percent to a mere 2.2 percent this year."

The Jakarta administration, up to Dec. 15, had received Rp 95 billion (US$11.18 million) from advertisement tax and another Rp 18 billion from advertisement site rental and strategic value tax.

Ad agencies also argued for stiffer sanctions on contract violations and less red tape in obtaining permits.

"(Outdoor) advertising in Jakarta is chaotic," said Didi Afandi of Jakarta Advertising Companies Union (SPRJ). "Take a look for example at the traffic circle in Kelapa Gading, North Jakarta" he said. "Some of the boards are horizontal."

By law, billboards are supposedly only placed vertically.

To facilitate the auctioning of advertisement sites, starting next year, the bidding would be done via the Internet, said assets bureau head Rama Boedi.

Companies would fill in their bids and submit them through cyberspace using a software called e-procurement. The software would automatically choose the highest bidder and send the announcement of the winner to all bidders.

Indra Pratama of Cinggasindo Galba, an ad agency which provides full services including outdoor advertising, said that e-procurement would only cloud the bidding process.

"They (the administration) can easily say this or that company won the auction," he told The Jakarta Post on the phone. "It's better to do the bidding face to face as it is done now."