TAXES
LAW
11
The Ministry of Trade (MoT) has recently commented on
Regulation
No. 22/M-DAG/PER/3/2016 of 2016 regarding
General Provisions on Goods Distribution
(Regulation 22), issued
in March 2016 as implementing regulation of
Law No. 7 of 2014
on Trade
.
The new legislation does not revoke
Regulation No. 11/M-DAG/
PER/3/2006 regarding Requirement and Procedure for the
Issuance of Registration Letter for Agent or Distributor of
Goods or Services
(Regulation 11), which provides that foreign
investment companies carrying out trading activities as
distributor or wholesaler need to appoint a national trading
company as agent, sole agent, distributor or sole distributor to
sell goods to consumers. Accordingly, an appointed national
trading company must register the agency or distributorship
agreement with a foreign investment company at the MoT and
obtain a registration certificate (STP). The STP is valid for two
years from the date of issuance unless the agency/distribution
agreement provides for a shorter appointment period.
Pursuant to Regulation 22, trading activities within Indonesian
territory need to be conducted through indirect or direct
channels. While the indirect channel consists of (i) distributor
network, (ii) agent network or (iii) franchise scheme, the direct
channel includes single-level and multi-level marketing, both to
be further specified by separate ministerial decree.
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Rödl & Partner is active at 108 locations in 50 countries. The integrated
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expertise to support our consulting works. Our presence in Asia/
Pacific spans over 15 offices in China, Hong Kong, India, Indonesia,
Malaysia, Myanmar, Singapore, Thailand and Vietnam. Our Indonesian
colleagues have vast experience and profound knowledge of the tax
and investment environment in Indonesia. For further information,
please refer to
.
PT Roedl Consulting
German Centre Suite 4300
BSD Tangerang 15321
Indonesia
Phone : +62 21 5376225
Fax
: +62 21 5376229
Email
:
Website :
Markus Schlueter
Attorney-at-law ( Germany )
+49 21 949 909 342
According to Article 22manufacturers/distributorsmay supply or
distribute goods destined as raw materials or auxiliary materials
to other producers without involvement of distributors or agents.
However, subsequently to the enactment of Regulation 22, MoT
issued statements concerning the requirement for a foreign
trading company to appoint a local distributor. While some official
letters from MoT appeared to confirm that distributors may sell
raw materials or supporting goods directly to a producer without
going through the indirect channel, other letters recently stated
that foreign trading companies must appoint a local distributor
to sell such goods to producers or interim consumers.
Due to the currently unclear policy of MoT, foreign trading
companies should take a cautious approach by appointing a
local trading company to distribute goods within Indonesian
territory and request such local distributor to obtain STP from
MoT as evidence of compliance with the requirements under
Regulation 11.
Trading PMA Company
Appointment of local distributors – Policy Update
