Health in Transition: New Government Regulation on Health Part 1 – Foreign Medical Personnel Employment and Minimum Bed Requirements
The recent enactment of Government Regulation No. 28 of 2024 (“Regulation“) marks the start of a significant healthcare reform in Indonesia, serving as the implementing regulation of the Law No. 17 of 2023 on Health (Omnibus Health Law). The Regulation replaces 31 prior governmental regulations, impacting a broad range of areas including hospital management, the use of telemedicine, medical record standards, and patient confidentiality. Importantly, it introduces key updates such as the mandatory use of electronic health records and the provision of telemedicine services, while simplifying the licensing process for healthcare professionals. The Regulation also streamlines hospital operations by allowing greater flexibility in appointing directors and regulating pharmaceutical and medical device safety.
In addition, the Regulation seeks to attract foreign medical personnel by simplifying the process for acquiring the necessary Registration Certificate (Surat Tanda Registrasi or STR) and Practice Licence (Surat Izin Praktik or SIP), with extended validity periods. Foreign nationals with medical qualifications, whether from Indonesian or international institutions, can practice in the country subject to certain requirements, but are restricted from private practice. The Regulation also removes the minimum bed capacity requirement from previous legislation for foreign investment hospitals, though a 200-bed minimum from earlier regulations still applies, creating some ambiguity. Overall, these reforms are aimed at improving the quality of healthcare services in Indonesia while promoting foreign investment in the sector.
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Powering Indonesia: How the New Local Content Policy Will Benefit Electricity Infrastructure
The Indonesian government has introduced a new local content policy through the enactment of Minister of Energy and Mineral Resources Regulation No. 11 of 2024 on Utilisation of Domestic Products for the Construction of Electrical Infrastructure (“Regulation“). This Regulation replaces the previous local content rules under Minister of Industry Regulation No. 54 of 2012 (“2021 Regulation“) and aims to boost domestic participation in the development of electricity infrastructure.
Notably, the Regulation provides an exemption from local content requirements for power projects funded by offshore loans or grants, provided certain conditions are met. This balance between international financing and local content aims to promote both foreign and local investment in Indonesia’s energy sector. Additionally, the regulation offers a relaxation of local content rules for solar power projects, which is set to accelerate solar energy adoption while fostering domestic manufacturing capabilities.
A key aspect of the Regulation is the lowering of cumulative local content thresholds across various types of power plants. The thresholds, as outlined in Ministry of Energy and Mineral Resources Decision No. 191.K/EK.01/MEM.E/2024, are lower than those stipulated in the 2012 Regulation, with specific reductions for steam, gas, and solar power plants, among others.
The Regulation also introduces a robust verification process to ensure compliance with the local content thresholds, which is handled by independent agencies before the project handover. Failure to comply with the local content thresholds could result in sanctions, including fines, suspension, or licence revocation. This regulatory framework marks a significant step towards fostering a sustainable and balanced energy future in Indonesia by creating opportunities for both domestic and international players.
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Trademark Rules Update: Non-Use Period Extended to Five Years Before Potential Deletion
In July 2024, Indonesia’s Constitutional Court extended the non-use period for trademarks from three years to five years. This period refers to the time a registered trademark is not used in connection with the goods or services listed in its registration. The decision came in response to a petition from a micro, small, and medium enterprise (“MSME“) entrepreneur, arguing that the original three-year non-use period did not allow sufficient time for recovery from force majeure events, such as the pandemic. The Court’s ruling, aligning with international practices like those in Singapore and England, aims to support MSMEs by providing them with more time to revive their businesses and prevent trademark deletion during difficult economic conditions.
The extension also reflects the broader goal of Indonesia’s trademark law in fostering a competitive and fair business environment. The Court’s inclusion of force majeure, such as government-imposed bans or crises, as a valid reason for non-use further strengthens protection for MSMEs. However, the application of force majeure remains limited to situations formally recognised by the government, potentially leaving some businesses unprotected during economic disruptions. Overall, the extended non-use period offers trademark owners, especially MSMEs, a valuable opportunity to stabilise their businesses and safeguard their trademarks while navigating unforeseen challenges.
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Mandatory Legal Audit Set to Shake Business Practice
In July 2024, the Indonesian government introduced a draft Presidential Regulation on Legal Compliance in the Formation and Implementation of Law (“Draft Regulation“), mandating annual legal audits for businesses, legal entities, and public institutions. This new requirement aims to enhance legal compliance by ensuring that these entities adhere to existing laws and good governance practices. The audits will be conducted by certified legal auditors, who will assess the compliance of business activities with legal regulations, provide recommendations for improvement, and issue formal reports. Public institutions, on the other hand, will be audited by legal analysts, with similar reporting obligations and sanctions for non-compliance.
The Draft Regulation places significant responsibility on the Minister of Law and Human Rights to oversee the audit process, including developing regulations, accrediting auditors, and ensuring service standards are met. While the regulation has not yet been enacted, it signals a major shift in Indonesia’s regulatory framework, with a focus on improving legal compliance across sectors. Businesses and public institutions are encouraged to strengthen their compliance efforts in anticipation of its implementation, as failure to adhere to audit recommendations could result in sanctions. The success of this initiative will depend on the effective resourcing and monitoring of the audit process by the Ministry of Law and Human Rights.
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New Regulation on Royalties of Books: A Victory for Authors
In June 2024, the Indonesian Ministry of Law and Human Rights (“Ministry“) introduced Regulation No. 15 of 2024 (“Regulation“), aimed at managing royalties for the secondary use of books and literary works. The Regulation ensures that authors and copyright holders receive fair compensation for the reproduction of their works, whether in physical, digital, or virtual forms. Secondary uses include copying, scanning, downloading, and artificial intelligence (“AI“) processing of books. The Regulation applies to both commercial and non-commercial activities that may affect the interests of authors or copyright holders. To facilitate royalty collection, authors can register with Collective Management Organisations (“CMOs“), which will manage the process on their behalf and ensure royalty payments for secondary uses.
The Regulation also addresses the licensing mechanism, limitations on secondary use, and the collection and distribution of royalties. Secondary users, such as educational institutions, AI developers, and other organisations, must pay royalties for any commercial use of books. Even non-commercial use may incur royalties if it harms the legitimate interests of the author or copyright holder. CMOs are tasked with collecting royalties, maintaining usage logs, and distributing payments to authors, providing annual reports to the Ministry. This new Regulation offers stronger legal protection for authors, ensuring they benefit financially from the secondary use of their works and minimising future royalty disputes.
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Please note that whilst the information in this Update is correct to the best of our knowledge and belief at the time of writing, it is only intended to provide a general guide to the subject matter and should not be treated as a substitute for specific professional advice
