Local Content Provision in National and International Law Investment Rules

  • Fatma Ayu Husnasari, Intan Inayatun Soeparna

Abstract

Investment is one of the efforts to increase national development which in accordance with Pancasila and Undang-Undang Dasar Negara Republik Indonesia 1945 (the 1945 Constitution of the Republic of Indonesia). The national interest in investment implements the performance requirement, especially related to the local content, but in international agreement often prohibits the local content rules, for example the Trans-Pacific Partnership (TPP) Agreement and the World Trade Organization (WTO). The purpose of the study was to construct the substance of local content regulation in the agreement of TPP, WTO, and positive Indonesian law. The researcher also conducted the visibility assessment towards Indonesia's desire to join the TPP Agreement. The method of the study used the law and regulation approach that applicable nationally and internationally. The method of analysis integrated the 1945 Constitution, international agreement, court decision and other material relating to the local content. This study resulted in the finding that Indonesia still applied the local content rules in law and regulation, but the WTO and TPP Agreement local content rules was prohibited. In the WTO there was still opportunity for developing countries to apply local content with the certain requirement. Local content rules of developing country in the WTO could still be applied, but with the certain requirement. One of them was giving notification and transparency on the regulation and policy from member countries as stated in the TRIMs regulation.

Published
2020-04-21