R

egents from across Indonesia are calling for a legal revision to simplify the issuance of business permits in a bid to boost investments.

The regents, members of the Indonesian Regency Administrations Association (Apkasi), consider Law No. 9/2015 on regional government to be a legal hazard for business permit issuance at the regional level.

Apkasi'€™s supervisory board chairman Isran Noor said the law had significantly undermined the authority of regents and mayors in giving the initial approval for investors who want to start projects in their areas.

'€œThe law has made governors into provincial leaders, taking over mandates which were previously in the hands of regency and city leaders. This has created a never ending line of bureaucratic red tape,'€ Isran said after the opening of Apkasi'€™s 2015 International Trade and Investment Summit in Jakarta on Wednesday.

Isran, who is also a regent of East Kutai in East Kalimantan, cited a recent case in Purbalingga regency, Central Java, where a small-sized sand mining company was required to acquire a series of recommendations and permits from the provincial governor and a special unit under a directorate general at the Public Works and Housing Ministry.

'€œRegents will be reluctant to give preliminary permits before investors have the recommendations from the provincial level and other institutions because they are afraid of violating the law,'€ Isran said.

A number of stipulations in Law No. 9/2015, which is closely connected to Law No. 23/2014, limit the previously broad authority owned by local administrations under Law No. 22/1999 and Law No. 32/2004 on regional administration.

Under the new law, the central government'€™s authority extends further, including giving it the authority to dismiss dissident local leaders.

Isran said his association was currently proposing a revision of the law through all branches of Indonesia'€™s government '€” executive, judicial and legislative. The association will request that President Joko '€œJokowi'€ Widodo issue a government regulation in lieu of law (Perppu) and file a judicial review to the Constitutional Court (MK), while also asking the House of Representatives'€™ Commission II to schedule a revision of the law in the 2015 National Legislation Program (Prolegnas).

'€œThis is not a request for more power for regents and mayors. Rather, we don'€™t want to complicate the procedures for business permits because we should provide proper, fast and affordable services for investors to support the country'€™s economic growth,'€ Isran said.

Investment Coordinating Board (BKPM) head Franky Sibarani said almost 80 percent of more than 300 regions in Indonesia had established one-stop service (PTSP) offices to serve investors applying for principal business permits. Of the offices, 50 percent have already integrated with the Jakarta office through an online system, Franky added.

'€œAll foreign direct investments as well as strategic sectors, such as cement and steel, should apply for permits at the BKPM'€™s central PTSP in Jakarta, while applications in other sectors or business types are only required in regional PTSPs,'€ he said.

Indonesia expects to meet this year'€™s investment realization target of Rp 519.5 trillion (US$39.79 billion), an ambitious goal, higher than the Rp 450 trillion set last year.

During Wednesday'€™s event, President Jokowi urged regional governments to promote their regions'€™ unique qualities to attract investors, as each region had its own potentials and commodities to be improved into products with added value.