23 February, 2013

Business Visas continue to be a source of contention, particularly what activities are and are not allowed under such visas, as the Government Regulation necessary to provide clear guidance failed to materialize.

It has been a year and a half, since May 5, 2011, to be exact, that the government enacted Law No. 6 of 2011 regarding Immigration (“Law No. 6/2011”). This new law was passed to deal with several issues that were not adequately addressed by the previous Immigration Law. Law No. 6/2011 seeks to achieve a host of objectives, among them more simplified immigration procedures for foreign investors, including a streamlined process to obtain a Permanent Stay Permit; more clarity on the much-questioned issue of mixed-nationality marriages; an improved response to immigration violations; and more robust preventative measures to curb the growth of transnational crimes.

Our focus here is the simplification of immigration procedures for foreign investors, specifically the scope of activities permitted under a Business Visa.

Under Director General of Immigration (“DGI”) Regulation No. F-434.IZ.01.10 of 2006 regarding Visas, as amended by DGI Regulation No. IMI-330.IZ.01.10 of 2009, and further amended by DGI Regulation No. IMI-819.IZ.01.10 of 2009 (“Regulation 434,” as amended), there are four types of visas: (i) Transit Visa; (ii) Visit Visa; (iii) Visa on Arrival; and (iv) Limited Stay Visa.

Visit Visas are more commonly known as Business Visas, and there are two types, a Multiple Entry Visa and a Single Entry Visa. Regulation 434, as amended, sets forth a list of permissible activities that may be engaged in by foreigners entering Indonesia under a Multiple Entry Visa or a Single Entry Visa.

For example, foreigners entering Indonesia on a Multiple Entry Visa are permitted to, among other things, take part in business discussions and engage in non-working business activities such as the purchase or sale of goods or services and the quality control process for goods or production. A holder of a Single Entry Visa can, in addition to the above activities, also participate in short training sessions.

Pursuant to the elucidation of Law No. 6/2011, holders of Visit Visas may engage in a broader scope of activities compared to the ones listed in Regulation 434, as amended. Such activities include (i) giving guidance, elucidation and training in the application and innovation of industrial technology to improve the quality and design of industrial products and overseas marketing cooperation for Indonesia; (ii) conducting activities related to comparative studies, short-term courses and short-term training; (iii) undertaking emergency work activities such as repairing a bridge that is in danger of collapse; (iv) conducting audits, quality control inspections of production processes or inspections of branch offices in Indonesia; and (v) meeting up with a transportation vessel within Indonesian territory. The new Immigration Law also provides that captains, pilots or crew members who are carrying out their duties on board a vessel are exempted from the obligation to obtain any type of visa.

While the new law allows for a broader range of activities, there is still confusion over what exactly is allowed under Business Visas, as everyone awaits the issuance of a Government Regulation on the implementation of Law No. 6/2011. Until such a Government Regulation is issued, the restrictions of Regulation 434, as amended, as well as other immigration regulations and policies, still apply.

It will be interesting to see how far the broader scope of activities for Visit Visa holders under Law No. 6/2011 will be implemented, especially since manpower and immigration officials have customarily had very strong views about training being conducted by foreigners in Indonesia. Currently, a foreigner can enter Indonesia under a Business Visa to participate in training, but not to provide training. A Work Permit should be obtained to provide training.

In the meantime, the scope of all the aforementioned activities is still open to various interpretations until an implementing regulation is issued.