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Law on Job Creation (Omnibus Law) Attracts Investment and Supports MSMEs

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By: Kirana Martasari)*

The Job Creation Act is an important policy in reducing hyper-regulation that has been hampering the progress of the business world. With this law, it will attract investment to Indonesia and support the development of Micro, Small and Medium Enterprises (MSMEs).

The Coordinating Minister for the Economy, Airlangga Hartarto, emphasized the importance of the Job Creation Law, which will encourage investment and will also encourage the involvement of national MSMEs in economic activities.

In a virtual discussion opportunity, Airlangga said that his party saw that the job creation law was encouraged to increase investment in increasing competitiveness in expanding the role of MSMEs and of course facilitating the legality of MSMEs, including for small and medium-sized businesses in obtaining halal certification.

One of the conveniences is through the Online Single Subsimission (OSS), business actors can process permits digitally and more easily. He said the government is also continuing to make improvements to this system. He explained, increasing human resources both in Ministries and Institutions as well as in the regions, so that the operations of Online Single Submission can be easily, quickly and definitely accessible to the public.

Currently, the government is revising Law Number 11 of 2020 concerning Job Creation. However, the government is still waiting for the ratification of amendments to Law No. 12 of 2011 concerning the formation of legislation (PPP).

From the results of the DPR plenary meeting held last week, a number of changes are said to have been prepared, including the omnibus law method in drafting laws and regulations. Or increasing public participation to obtain community rights.

After the discussion of Law Number 12 of 2011 is complete, the government will continue to revise the Job Creation Law, which is a mandate from the Constitutional Court’s decision at the end of last year. After the revision of Law 12 has been completed with mutual agreement between the government and the Indonesian House of Representatives, the government will continue to revise the Law on Job Creation in accordance with the Constitutional Court’s decision Amar.

Meanwhile, it should also be noted that MSMEs will get a number of benefits through the existence of the Job Creation Law. This was said by the Head of the Investment Coordinating Board (BPKM), he ensured that the perpetrators of Medium, Micro, Small Business (MSMEs) could increase their competitiveness.

One of the rules that benefit MSMEs is contained in Government Regulation (PP) Number 7 of 2021 concerning Ease, protection and empowerment of cooperatives and MSMEs.

The advantages for MSMEs include granting MSMEs permits to have a Business Identification Number (NIB), which will make granting business permits to MSMEs fast, only two to three hours.

In addition, with the NIB, MSME actors will find it easier to get access to capital from banks. Previously, business licensing for MSME actors, Bahlil claimed, reached millions of rupiah.

With NIB ownership, financing can go to the bank, if there is no permit, making a business license can reach Rp 5 million to Rp 6 million, even Rp 10 million.

Another feature, said Bahlil, is that the government will provide convenience for raw materials, production processes, improving the quality of human resources, and marketing products from MSMEs. The government even allocates 40% of special spending to buy MSME products.

Previously, on the occasion of the 2022 Economic Outlook, Bahlil said, one of the substances of the Job Creation law is licensing for investment. So the Job Creation Law is a gateway to increase investment realization in 2022.

He said that Article 174 of the Job Creation Law states that the licensing authority that exists in ministries/agencies and regional heads is interpreted as the authority of the President which is delegated to these officials. This authority will be regulated through norms, standards, procedures and criteria (NSPK).

One of the derivative regulations of the Job Creation Act is Government Regulation Number 5 of 2021 concerning the Implementation of Risk-Based Business Licensing, which states that licensing arrangements must be electronically based via online single submission (OSS). All these processes are carried out at the Ministry of Investment and are carried out in a transparent manner.

The Job Creation Act is a formula that should be supported, the regulations in the regulation contain various benefits that can be obtained by MSME actors and investors who want to invest in Indonesia.

)* The author is a contributor to Pertiwi Institute

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