ANNOUNCEMENT 04 Sep 2009

In September 2009, the government of Indonesia announced a change in the price advantage granted to domestic producers in certain public tenders.

NUMBER OF INTERVENTIONS

1

  • 1 harmful
  • 0 neutral
  • 0 liberalising
Inception date: 03 Nov 2009 | Removal date: 03 May 2013
Still in force

Public procurement preference margin

On 4 September 2009, the state-owned company BP Migas issued decree 007-Revisi-1/PTK/IX/2009 introducing domestic procurement preferences in the oil & gas industry.
Acccording to the decree (cf. 8.4-8.5 of chapter II), the maximum price preference for domestic goods is 15% and 7.5% for domestic services. A further price preference of 7.5% is given to a 100%-domestic goods supplier (8.7.1). Domestic suppliers with minority stakes held by foreign entities receive a price preference of 5% (8.7.2).
The regulation came into force 60 days after its issuance, i.e. on 3 November 2009 and was amended in 2011 (cf. Sources), where the local content requirements for procurement preference were slightly increased.
On 13 November 2012, the Indonesian Constitutional Court declared the company concerned, BP Migas, unconstitutional. BP Migas was later renamed and put under the control of the Ministry of Energy and Mineral Resources (hereinafter: MEMR). The regulation concerned was replaced on 22 May 2013 by MEMR regulation 15/2013 (cf. Related Measures).
 

AFFECTED SECTORS

 
N/A

AFFECTED PRODUCTS

 
N/A