Having been in force since 4 January 2008, Minister of Home Affairs Regulation No. 3 of 2008 replaced the earlier Minister of Home Affairs Regulation No. 1 of 1992 which prescribed the guideline for the implementation of cooperation between Regional Government and Foreign Parties.

According to the said Regulation, the basic principles of cooperation between Regional Governments and foreign parties are to be based on equality, mutual benefit, no interference to political or economic stability, respect for the sovereignty of Indonesia, maintenance of the environment, gender conscious, and in accordance with the prevailing laws and regulations of the Republic.

The types of cooperation permitted are sister city or province relationships, technical assistance, humanitarian assistance, and capital investment. In addition, the required conditions to set up such cooperation are as follows:

-          the cooperation constitute a part of the overall management and administration goals of the Regional Government,

-          there is a diplomatic relations between Parties,  

-          the cooperation is within the scope of the relevant region affairs,

-          the cooperation does not interfere the domestic affairs of Indonesia,

-          the cooperation is in accordance with the policy and development plan, and

-          the cooperation leads to the transfer of knowledge and technology to the relevant region.

While the Minister of Home Affairs will provide a framework of the basis of the Agreement to the Governor, the approval of the cooperation agreement must be made by the House of Representatives of the relevant Regional Government (Dewan Perwakilan Rakyat Daerah / DPRD). Such approval is to be made no longer than 30 days after the agreement is received and made in a form of DPRD’s Decision. If there were no approval granted by the DPRD after 30 days then it is to be deemed that the DPRD approves the cooperation agreement.

Any dispute arise from the cooperation agreement shall be resolved according to the provisions contained in the Memorandum of Understanding between the parties. In the stage of contract implementation, the Provincial Governor shall report to the Minister of Home Affairs in minimum twice per year.

Source: www.hukumonline.com, ILB 6/2/2008: Cooperation between Regional Governments and Foreign Parties - Guidelines