Managing Immigration in the Age of Disruption: A Look at Indonesia

In the run-up to our upcoming APAC Immigration Conference 'Managing Immigration in the Age of Disruption', we wanted to take a closer look at several of the countries that we cover from within the region and how each are coping with disruption to their immigration systems.

Amidst the attention-grabbing headlines coming out of other regions, one would be forgiven for presuming that most countries nowadays are heading towards a more protectionist immigration policy. However, digging a little deeper, the Asian region has several examples of countries that have taken a different (yet still pragmatic) approach. 

For instance, Indonesia has emerged as a surprising counterpoint – a country attempting to modernize and streamline its immigration and work permit process, rather than making it more difficult. That said, while it can be characterized as proceeding in a positive trajectory, several obstacles, and implementation issues remain.

By way of background, 2018 ended up being a pivotal year for the business immigration landscape in Indonesia. In the early part of the year, President Joko Widodo (Jokowi) called on several government agencies to streamline and modernize the oft-maligned work permit process. In an effort to do so, the authorities reduced the number of steps required and the number of government agencies that the applicant company would ostensibly have to deal with. For example, under the previous work permit process, a company would need to file the initial applications with the Ministry of Manpower (MOM) and then continue the process with a separate filing with the Directorate General of Immigration (DGI). This led to a bifurcated system with little communication between the government agencies in charge of the overall immigration and work permit process. Under the new process, the MOM will now directly alert the DGI after it has completed its part of the process (i.e., the company need not file separately with the DGI). 

While some of these changes (such as the above) have been welcomed by many companies, the devil, as they say, is in the details. As with any new system, the process in Indonesia remains complicated due to a number of ongoing challenges. For example, in another effort at streamlining, the authorities modified the process for obtaining the ITAS, or limited stay permit (akin to a residence permit), by allowing foreign nationals to apply for it at designated ports of entry. This supposedly would allow for a quicker process in obtaining the ITAS, one of the final documents in the work permit process. The problem, as we have seen, is that there has oftentimes been a disconnect between what the regulations say and what is actually happening on the ground. As such, in some cases, the ITAS is still not issued even after completing the process at the airport and, in turn, the individual then needs to complete a manual application at the local immigration office (which can, therefore, cause delays to his employment start date and/or restrict his travel). 

Furthermore, in addition to the challenge of obtaining the ITAS, the process has also not been smooth when it comes to the VITAS endorsement step (i.e., the entry visa obtained at the Indonesian Consulate even prior to the employee obtaining the ITAS). Under the old system, almost all Indonesian Consulates were able to support the VITAS application and endorsement. However, under the new system, only 22 Indonesian Consulates (in select cities worldwide) are able to issue the VITAS for foreign nationals intending to enter Indonesia to work. This continues to pose a challenge to applicants who are not based in one of those 22 cities and who now must travel to the nearest available Consulate to complete the VITAS endorsement process. This results in additional travel and inconvenience for the employee and the companies who they work for (not to mention, perhaps additional visa requirements for that country of transit).

That being said, we still remain hopeful that the country’s work permit reforms remain on the right track. With Jokowi’s recent re-election to a second five-year term, it is likely that these streamlining measures will continue and that the current system will be refined. An additional bright spot has been the country’s push towards digitalization, with the work permit process now completely online (which is a sea change from where it was even just a few years ago). This should presumably increase transparency in adjudication as well as (somewhat) decrease discretion (long the bane of business immigration practitioners in the country).