Decree lists restricted business sectors
Decree lists restricted business sectors
JAKARTA (JP): The negative investment list in Presidential Decree No 31, 1995, which was issued on Tuesday as part of the government's latest deregulation package, contains four categories of restricted business activities.
The first category contains business sectors which are closed to wholly foreign-owned companies. The second category consists of those entirely closed to wholly and partly foreign-owned companies. The third category includes businesses which are entirely closed to new investors, except those who fulfill certain requirements, while the fourth category covers those sectors which are totally closed to both domestic and foreign investors. * Business sectors which are closed to wholly foreign-owned companies (and open to Indonesian-foreign joint ventures) are the construction and operation of seaports; power generation, transmission and distribution for the public; telecommunications; shipping; aviation; the construction and operation of drinking water plants; railway services; and atomic power plants. * Business sectors which are closed to wholly and partly foreign- owned companies include taxi and bus transportation services; local shipping services; retailing and its related services; supporting services for domestic trade such as advertising; radio and television broadcasting services; movie theaters.
The government's announcement on the negative investment lists on Tuesday caused confusion as the term "supporting services for domestic trade" appeared in both the first and the second categories.
A copy of the presidential decree stipulating the restricted business sectors was available only on Wednesday. * Business sectors which are closed for investments except those which fulfill certain requirements include: the production of milk powder and canned milk except if it is integrated into a dairy farm; sawmilling, except in the provinces of East Timor and Irian Jaya; plywood production, except in East Timor and Irian Jaya.
The printing of certain official documents, such as postage stamps, Bank Indonesia's securities and passports are closed to both foreign and domestic companies other than Perum Peruri, the state-owned valuable paper printing company.
Other business sectors included in this category are the production of ethyl alcohol, except that of technical grade; the production of explosives, except by state-owned PT Dahana and PT Multi Nitrotama.
The manufacture of aircraft and their engines and supporting facilities is closed unless it is in cooperation with or for PT IPTN, the state-owned aircraft manufacturing company in Bandung.
The production of alcoholic beverages is closed unless it is for export, as is the case for the production of firecrackers. * Businesses which are totally closed to private investment are forest-clearing services, casinos and other gambling activities; sponge processing; the manufacture of semi-finished and finished mangrove wood; the production and processing of marijuana; the production of saccharin; and the production of pulp using sulfate, chlorine-alkali, chloro-fluoro carbons or freon.
The decree also stipulates 37 business sectors reserved for small-scale companies.(hen)