16 June 2016
INDONESIA: 100% FDI Approved for the E-Commerce Sector
Indonesia is to permit 100% foreign direct investment (FDI) in the e commerce sector for the first time, with a formal ruling on this change expected by the end of June. The change has been facilitated by a revision to the country’s Negative Investment List (NIL).
It is believed that investment in the sector will be subject to the following four conditions:
- 100% FDI will be permitted in an e-commerce business as long as the investment is at least Indonesian Rupiah 100 billion (US$7.4 million).
- If the investment falls below that threshold, FDI will be limited to 49%.
- A foreigner or a foreign entity will be allowed to own a 100% stake in an e-commerce business regardless of the level of investment if the total number of local workers employed in the company exceeds 1,000.
- It will be mandatory for foreign investors in the e-commerce sector to cooperate with local micro, small, and medium enterprises (MSMEs).