President Regulation No. 112 of 2007 on the Setting and Guidance of Traditional Markets, Shopping Centers, and Modern Shops

The President Regulation No. 112 of 2007 on traditional markets, shopping centers, and modern shops was issued and came into force on 27 December 2007.  The purpose of the Regulation is to create a system that will mutually beneficial to all players in the retail sector. The Regulation contains specific provisions on where the shopping centers and modern shops may be located, the spatial plan of the relevant area and any other zoning restrictions that may be in place.

Traditional markets, shopping centers (shops, mall, plaza, trade center), and modern stores (mini-market, supermarket, department store, or hypermarket) must obtain a license from the relevant Regent or Mayor or the Governor where the business is located. A traditional market will require the Traditional Market Management License (Izin Usaha Pengelolaan Pasar Tradisional / IUP2T). A shopping center will require the Shopping Center Business License (Izin Usaha Pusat Perbelanjaan / IUPP). A modern store will require the Modern Store Business License (Izin Usaha Toko Modern / IUTM).

Prior to one of these licenses being issued the applicant must include in their application a feasibility study, an environmental impact assessment, an impact assessment from the perspective of local culture, and an impact assessment concerning any effects on local retailers if the application was to be approved.  The application must also include a partnership plan for cooperation with small businesses. Further implementation of the Regulation will be carried out by the Minister Regulation.

Source: www.hukumonline.com, ILB 3/1/2008: Traditional Markets in the Age of Mini and Hyper Markets