Indonesia Sets Conditions for Exporters’ Special Foreign-Currency Rules

Indonesia’s economic coordinating minister Airlangga Hartarto outlined who can qualify for special treatment under rules on export earnings from natural resources.

A company must be from a country that has a bilateral or multilateral agreement with Indonesia; the listed partners include the United States, China, Japan and the European Union.

A shareholder from a partner country must own at least 10% of the company for it to qualify.

Under the special rules, eligible mining exporters must place at least 30% of their export earnings in Indonesia for at least three months, and may use some non-state-owned banks.

The standard rules require non-oil and gas exporters to place all export earnings for at least 12 months, while oil and gas exporters must place at least 30% for three months.

The government is reviewing the eligibility criteria, including requirements to disclose ultimate beneficial owners and possible coverage of permanent business establishments.

The rules require natural-resource export earnings to enter Indonesia’s financial system through special accounts, and the government has not said when any changes will take effect.