Govt opens companies' management to expats
Govt opens companies' management to expats
JAKARTA (JP): The government has opened almost all positions within the boards of directors and the boards of commissioners of companies partly or wholly owned by foreign investors to expatriates.
The simplification of procedures for hiring expatriates for management positions is stipulated in Presidential Decree No.75/1995 dated Nov. 9 which took effect immediately.
Only the post of personnel director at wholly foreign-owned, joint ventures and national companies is closed to expatriates.
This was the first time that a presidential decree regarding the procedures for the recruitment of expatriates specifically stipulated particular positions open to foreigners.
Presidential Decree No.23/1974 which was revoked by the latest ruling contained only general guidelines for the categories of occupations open to expatriates and empowered the manpower minister to handle the technical details.
The latest regulation also stipulates that companies wholly owned by foreign investors can appoint expatriates to the boards of directors and commissioners.
"However, appointments to the boards of directors and commissioners of companies partly owned by foreigners or wholly owned by Indonesians shall be based on the agreement of the shareholders," the new ruling states.
The latest ruling was issued apparently to provide legal certainty for the appointment of management and supervisors especially at wholly foreign owned companies.
Wholly foreign-owned enterprises have only been allowed to operate for the last two years after the deregulation of the investment sector in the country.
The latest ruling also allows for the appointment of expatriates to the boards of directors of domestic companies whose operating licenses are not administered by the Investment Coordinating Board (BKPM). Enterprises in this category are allowed to appoint only Indonesians to their boards of commissioners.
The new presidential decree authorizes the manpower minister to decide which occupations are closed or open to expatriates only for a specified period of time.
The lists of occupations closed or open to expatriates shall be reviewed every three years, the ruling says.
The Manpower Ministry's data on April, 1995, showed that the number of expatriates working in Indonesia reached 30,266. They were employed in the sectors of manufacturing (50 percent), mining (12 percent), trade (11 percent), forestry (seven percent) and others (20 percent). They occupied positions ranging from technicians to management.
Chief of legal bureau of the Ministry of Manpower Basani Situmorang said that the new ruling should be understood in the context of the 1958 law on the employment of foreign workers.
Basani said that the minister of manpower would shortly issue a list stipulating the positions below directors and commissioners which are still open to expatriates.
"The minister will also issue a new decree regulating the fee imposed on all foreign workers in the country," she said, adding that the amount has yet to be set.
According to Ministerial Decree No 143A, issued in 1991, all foreign workers are obliged to pay US$150 each time they renew their working permits.
Basani reaffirmed that all companies employing foreign workers are obliged to undertake training programs so Indonesians can eventually replace the expatriates. (rms)