The Quiet Reform in Indonesia’s Immigration System: Part 1

In the first of this two-part blog series, Senior Manager Alfred Chong and Senior Business Immigration Consultant Raga Rasuanta discuss the recent evolution of Indonesia’s immigration system, particularly its pre-pandemic reforms, with local co-counsel partner in the country, Mr. Philo Dellano, Managing Partner of PNB immigration law firm.

Indonesia: Investing in the Future

With a population of 275 million and an area the size of Europe, Indonesia is Southeast Asia’s largest economy, comprising about one-third of the region’s total gross domestic product. Indonesia’s economy has grown rapidly throughout the last two decades, notably in the post-Suharto era, and it currently holds the G20 Presidency in 2022.

To tackle unemployment, raise income levels and further develop the country, the Indonesian government has been investing and embarking on many national strategic projects in recent years, spanning the likes of railway construction, toll-roads, ports, power plants and more. Apart from the government investing in these projects, Indonesia is also trying to attract more foreign investment, especially since foreign expertise (apart from capital) is needed for these infrastructure projects.

To attract foreign investment and to facilitate people movement, there have been several reforms implemented by the government, especially to simplify the government processes for local companies to obtain work permits for foreign workers and talents. From the immigration perspective, these important reforms have been silently yet assuredly taking place over the years (at a pace that may be surprising to some).

Pre-Pandemic Reforms

One of the main challenges companies have faced when deciding to invest in Indonesia is the historically bureaucratic and lengthy process to obtain work permits for their foreign national employees.

Traditionally, Indonesia’s immigration system has been one of the most complex in the Asia Pacific region. Securing work permits for foreign national employees is often a complex process requiring approvals from different government departments, and this may take a few months (or even up to a year in some cases) before the employee is able to start work in the country. While the government has been busy attracting foreign investment, we have noticed a “quiet reform” in Indonesia’s immigration system in recent years as they have taken significant steps to streamline the work permit process.

For example, in a timeframe of only a couple of years, the immigration system has evolved from a very manual application process to utilizing online submissions. On that point, Philo remarked that “Now because of online submission, it is convenient to check where the application is, whether there is any feedback from the officer, and the process is faster than manual submission.”

One of the biggest reforms in recent years includes the implementation of the Stay Permit (ITAS) on arrival in 2018. That change alone helped to cut the overall work and stay permit processing time by two weeks, and allowed foreign national employees to start working almost immediately upon arrival.

Prior to this change, foreign employees were required to complete a biometric capturing session at the local immigration office before they could be issued an ITAS. “President Jokowi wanted Indonesia to open for foreign investors and investment, to make it less bureaucratic in Indonesia, to make the immigration process easier for people to travel in and out of Indonesia – the idea is to make it easier for foreign workers to travel in and out,” said Philo. “The ITAS can be issued automatically once the foreign workers enter Indonesia so that the applicant does not need to go to the local immigration office. This is a good idea and good timing from the Indonesia government,” he added.

Another significant reform was the introduction of the Notifikasi (now called Pengesahan RPTKA, which replaced the IMTA) and the integration of the work permit and visa application process into a single online submission. For quite some time, companies were required to submit separate applications to the Ministry of Manpower (to apply for the work permit) and the Directorate General of Immigration (to apply for the visa). While there has been some skepticism on how much time this integration actually saved, it is still a notable effort as it has at least streamlined the coordination of processes between different government agencies—no small feat in Indonesia.

Need to know more?

Please look out for part two of this blog series next week, where Alfred and Raga continue their discussion with Philo and explore pandemic-related immigration reforms in Indonesia, the possibility of the Digital Nomad Visa and looking ahead to the future.

For further information and advice on this topic, please contact Senior Manager Alfred Chong at [email protected] and Senior Business Immigration Consultant Raga Rasuanta at [email protected]. This blog was published on 14 September 2022, and due to the circumstances, there are frequent changes.

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