REGULATION ON WATER TRANSPORTATION BUSINESS
A third government regulation for the implementation purposes of certain articles of Law No. 17/2008 regarding Shipping (“Law No. 17”) was issued on 1 February 2010. The regulation, No. 20/2010 regarding Water Transportation (“GG 20” or the “Regulation”), provides the legal framework for the establishment businesses relating to water transportation.
GG 20 contains more than two hundred articles covering all of the aspects of the water transportation business and improving the provisions on aspects which had not been adequately regulated. The Regulation also introduced a number of new businesses relating or associated to waters transportation which it expect businesses to enter into as part an effort to make Indonesian ports more competitive among ports in the neighboring countries and in anticipation to fully the country’s diversified export in the future.
In addition to mentioning the types of waters related transportation business, the Regulation also sets out licensing and ownership requirements, details of each type of business that business actors may engage in each sector of business, tariff on each sector, as well as obligation and responsibility of shipper.
One important chapter of the Regulation deals with the government efforts to revitalize the country’s water transportation industry as part of the application of cabotage principle in the Indonesian shipping industry. As part of this effort, the Regulation is required to provide tax and financing facilities and facilitating partnership between cargo owner and ship owner as well as providing guarantee of fuel supply to water transportation.
The Regulation has become since the day of its issue but waters transportation business is only required to adjust their license in accordance with the Regulation for two years. (by: Hamud M. Balfas)