Mandatory Use of Rupiah within the Republic of Indonesia Takes Effect as of Today - Bank Sentral Republik Indonesia
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January 23, 2020

No. 17/52/DKom

Mandatory use of Rupiah within the Republic of Indonesia (RI) starts to be fully implemented as of today. The regulation aims to enforce Rupiah sovereignty within the RI and simultaneously support macroeconomic stability. The provision specified in the Regulation of Bank Indonesia (RBI) No. 17/3/PBI/2015 dated 31 March 2015 sets forth that every transaction within the RI must use Rupiah. This RBI is the implementation of Law No. 7 of 2011 on Currencies and based on the Law on Bank Indonesia.

However, such provision excludes transactions for the implementation of the State Budget, international trade, international funding by parties, one of whom is located overseas, bank's business activities in foreign currencies performed under the Law on banks and sharia banks, transactions of securities issued by the Government in foreign currencies in the primary market and secondary market which have been specified under the law, and other transactions in foreign currencies performed under the law.

In addition, for smooth implementation of economic activities and mandatory use of Rupiah, under Article 10 paragraph (3) and Article 16 of the RBI, Bank Indonesia may grant approvals to businesses. Such approvals are granted by application lodged with Bank Indonesia to be able to keep using foreign currencies in relation to strategic infrastructure projects and other required particular characteristics, such as system adjustment, accounts and records, business strategies, and evaluations of business process and corporate finance.

The provision also allows written contracts or agreements using foreign currencies made prior to 1 July 2015 to remain valid until the expiration of such written agreements, to the extent they are detailed and not amended. When the application is still in process with Bank Indonesia, businesses may still use foreign currencies in such applied business activities. Sanctions will be imposed as of the issuance of refusal of any applications lodged with Bank Indonesia.

To facilitate the general public to obtain information on the technical implementation of the provision for mandatory use of Rupiah, Bank Indonesia provides call center (BICARA) 131 from Monday through Friday, 08.00 to 16.00 West Indonesia Time (office hours), as well as collective consultation for businesses requiring further explanation of the implementation of such provision for mandatory use of Rupiah. For registration and further information, the general public may contact the call center of Bank Indonesia, 131.

Bank Indonesia extends its appreciation to the Ministries, Institutions, Associations, and Businesses which have provided their support for the enforcement of the RBI on Mandatory Use of Rupiah. With such support from various parties, Bank Indonesia believes that the RBI may be well implemented to positively contribute to macroeconomic stability, primarily in terms of exchange rates.

Jakarta, 1 July 2015
Communication Department

Peter Jacobs
Director

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