The Government finds that in practice, plenty of Foreign Capital Investment Companies (“PMA”) and Domestic Capital Investment Companies (“PMDN”) are operating without Business License. Prevailing regulations requires Project Examination Minutes (BAP) to be submitted in applying for Business Licenses. In the Government’s view, this requirement is seen to burden existing PMA/PMDN companies wishing to obtain necessary licenses. Responding the situation The Indonesian Capital Investment Coordinating Board (“BKPM”) issued a decision abolishing the requirement to submit BAP for those companies

Requirement for Project Examination Minutes (“BAP”) for companies applying for Business Licenses is based on Article 6 of the BKPM Decision Numbers 61/SK/2004 and 71/SK/2004 (“BAP Decisions”) which stipulates that Project Examination Minutes or BAP is required to apply for Business License/Permanent Business License. The project examination and signing of BAP will be conducted by an investment supervisory team established by the Governor.

As the requirement above is seen burdening, The Head of BKPM then issued Decision Number 76/SK/2004 on Business Licenses / Permanent Business Licenses for PMDN and PMA companies Already in Operation / Production (the “Decision”). The Decision contains only 2 (two) articles which applies only to companies that are already established, already commenced operations or production who are yet to obtain the necessary business license.

Article 1 explicitly states that the normal requirement of BAP has been abolished. The application procedures are simply to submit a Capital Investment Activity Report (“LKPM”) for the last reporting period along with any other required documentation pursuant to the Attachment to this Decision. This application is to be submitted to the Head of BKPM prior to 20 December 2004. A decision on the application will be issued by the BKPM no later than 10 days after the complete and accurate application form was received.

Article 2 stipulates the temporary nature of this decision in that it states that the Decision is effective since its date of enactment until December 31^st 2004. (mma)