Conditional Initial Offer

RESTRICTED WORLD TRADE TN/S/O/IDN 22 April 2005 ORGANIZATION (05-1661)

Council for Trade in Services Original: English Special Session

INDONESIA

The following communication, dated 12 April 2005, from the delegation of Indonesia, is being circulated to the Members of the Council for Trade in Services.

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INTRODUCTION

1. Pursuant to paragraph 15 of the Ministerial Declaration of 14 November 2001, Indonesia herewith submits its conditional initial offer of specific commitments in the framework of the ongoing services negotiations under the General Agreement on Trade in Services (GATS) and in the context of the Doha Development Agenda (DDA).

2. By means of this offer, Indonesia reiterates its WTO commitments to achieving a gradually progressive liberalization taking into account of its capability as a developing country.

3. This offer is conditional upon:

(a) the outcome of the negotiations stipulated by the GATS including negotiations on Emergency Safeguard Measures (Article X GATS);

(b) other WTO Members making substantive offers in sectors and modes of supply where Indonesia has interests;

(c) the balanced outcomes of the DDA negotiations.

4. Indonesia reserves the right to modify, extend, reduce, or withdraw in whole or in part any of this offer at any time prior to the conclusion of the current services negotiations. It also reserves the right to submit technical amendments and corrections to rectify any errors, omissions, or inaccuracies in this offer and to clarify and interpret the term and conditions of this offer.

5. In the light of Indonesia’s desire to promote the gradual progressive liberalization of trade in services, this contribution includes, inter alia, offers in the following sectors: professional services (legal services), construction services, education services, financial services, health services, maritime services, and energy services.

6. Indonesia drew up this initial offer on the basis of the Services Sectoral Classification List (MTN.GNS/W/120) and in accordance with the definitions in the 1991 United Nations’ Provisional Central Product Classification (CPC), unless otherwise specified. TN/S/O/IDN Page 2

7. Indonesia may decide to alter or further refine classification on the basis of further analysis or any relevant developments in discussion in the Committee on Specific Commitments or other appropriate fora.

8. The editorial conventions used in this initial offer follow the guidelines established by the WTO Secretariat in JOB(92)/88 :

 BOLD – New text  STRIKE OUT – Deleted text  ITALICS – where any new or deleted text constitutes merely a technical refinement that does not alter the scope or substance of an existing commitment In addition:

{ } - information annotated solely for the purposes of explanations and does not form part of the proposed commitment.

______INDONESIA – CONDITIONAL INITIAL OFFER

TN/S/O/ID N Page 3 Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID N I. HORIZONTAL COMMITMENTS Page 4 ALL SECTORS 1), 2) As specified in each sector 1), 2) As specified in each sector INCLUDED IN THIS SCHEDULE

3) Commercial Presence of the foreign service 3) The Income Tax Law provides that non- provider(s) may be in the form of joint venture resident taxpayers will be subject to and/or representative office, unless mentioned withholding tax of 20% if they derive the otherwise. following income from Indonesian source: (a) interest Joint venture should meet the following (b) royalties requirements: (c) dividend (d) fee from service performed in Indonesia

(i) should be in the form of Limited Liability Land Acquisition Enterprise (Perseroan Terbatas/PT), Undang-Undang Pokok Agraria (Land Law) No. 5 of 1960 stipulates that no foreigners (ii) not more than 49% of the capital share of (juridical and natural persons) are allowed to the Limited Liability Enterprise own land. However, a joint venture enterprise (Perseroan Terbatas/PT), may be owned could hold the right for land use (Hak Guna by foreign partner(s). Usaha) and building rights (Hak Guna Bangunan), and they may rent/lease land and property.

Any juridical and natural persons should meet professional qualification requirements. Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID 4) Subject to Indonesian Labour and Immigration 4) Expatriate Charges N Laws and Regulations, only directors, Any foreign natural persons supplying services Page 5 managers and technical experts/advisors, are subject to charges levied by National. unless mentioned otherwise, are allowed with a Provincial, and Municipal Governments maximum stay of two years subject to one year extension. Manager and technical experts Labour Laws and Regulations. (intra corporate transfer) are allowed based on Any expatriate employed by a joint-venture an economic needs test. enterprise, representatives office, and/or other types of juridical person and/or an individual The entry and temporary stay of business services provider must hold a valid working visitor(s) is (are) permitted for a period of permit issued by the Ministry of Manpower 60 days. and Transmigration.

Immigration Laws and Regulations. Any expatriate must meet immigration requirements and procedures to enter the territory of the Republic of Indonesia. Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID N Definitions: Page 6 "Director": One or a group of persons entrusted by the shareholders of a services providing entity with the final overall control and direction of the enterprise, and legally responsible to act on behalf of the enterprises inside and/or outside of the court.

"Manager": Senior employee of a service supplier who primarily directs the management of the organization, receiving general supervision or direction principally from the board of directors of the business, including directing the service supplier or a department or sub-division thereof, supervising or controlling the work of other supervisory, professional or managerial employee or having the authority to hire or fire or recommend such or other personnel actions.

"Technical Expert/Advisor": Person employed by a service supplier who possesses a standard of high or common (i) qualifications referring to a type of work or trade requiring specific technical knowledge or (ii) knowledge essential or proprietal to the service, research equipment, techniques or management.

"Joint Operator": A joint operation is an undertaking between one or several foreign and Indonesian enterprises of temporary nature, to handle one or several project/businesses without establishing a new statutory body according to Indonesian laws

"Joint venture Enterprise": A joint venture enterprise is a legal entity organized under Indonesian law and having its domicile in Indonesia, in the form of cooperation between foreign capital and Indonesian ( national) capital.

"Contract Management": Contract management is a contract organized under Indonesian law in the form of cooperation on management of temporary nature between Indonesian (national) capital and foreign capital.

Business visitor(s) is (are) natural person staying in Indonesia for the purpose of participating in business meeting, business contacts including negotiations for the sales of services and/or other similar activities including those who prepare for the establishment of a commercial presence in Indonesia, without acquiring remuneration and/or any other direct income from within Indonesia, and are not engaged in making direct sales or supplying services to general public.

II SECTOR-SPECIFIC COMMITMENTS Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID 1. BUSINESS SERVICES N A. Professional Services Page 7 a. Legal Services 1) None 1) None (Advisory services in home 2) None 2) None country law, and 3) Unbound 3) Unbound international law). 4) Unbound except for foreign lawyers 4) Unbound except for foreign lawyers (CPC 861) (advokat). (advokat). Foreign lawyers (advokat) are allowed to Foreign lawyers (advokat) are : work or take part in Indonesian law firm - only allowed as employees or experts in as employees or as experts in International Indonesian law firm Law, but shall not appear in courts and/or - obliged to transfer legal knowledge and undertake legal proceedings under any professional capabilities to Indonesian circumstances. Lawyers - obliged to transfer knowledge to education, legal research, or government institutions at least 10 hours each month free of charge. The share of foreign lawyers (advokat) in Indonesian law firm must not exceed 20 per cent, and shall be limited to five foreign lawyers (advokat) per firm.

Definition : Lawyer (advokat) is person who has the profession of providing legal service in and outside the court. International law means law established by international treaties and conventions as well as customary law. Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID N d. Architectural Services 1) Unbound 1) Unbound Page 8 (CPC 8671) 2) None 2) Unbound 3) (a) Joint operation 3) (a) Joint operation : To form a joint operation by establishing a 1. Registration Licence fee requirement representative office 2. Licence for representative office shall be valid for 3 years and can be Licence for representative office shall be extended valid for 3 years and can be extended. 3. 2. Registered foreign company shall form a joint operation with local (b) Joint venture partner(s) which is (are) member(s) To establish a joint venture company by of the Indonesian Consultant fulfilling the requirements as specified in Association having qualification A the Horizontal Measures Section and the registered by Construction Services Foreign Capital Investment Law Development Board and having qualification A/Big

(b) Joint venture : Local partner(s) in joint venture shall be member(s) of the Indonesian Consultant Association and having qualification A. registered by Construction Services Development Board and having qualification A/Big 4) As specified in the Horizontal Measures 4) As specified in the Horizontal Measures Section Section Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID e. Engineering Service 1) Unbound 1) Unbound N (CPC 8672 - except CPC 2) None 2) Unbound 86721-86725-86726) 3) (a) Joint operation 3) (a) Joint operation : Page 9 To form a joint operation by establishing a 1. Registration Licence fee requirement representative office 2. Licence for representative office shall be valid for 3 years and can be Licence for representative office shall be extended valid for 3 years and can be extended. 3. 2. Registered foreign company shall form a joint operation with local (b) Joint venture partner(s) which is (are) member(s) To establish a joint venture company by of the Indonesian Consultant fulfilling the requirements as specified in Association having qualification A the Horizontal Measures Section and the registered by Construction Services Foreign Capital Investment Law Development Board and having qualification A/Big

(b) Joint venture : Local partner(s) in joint venture shall be member(s) of the Indonesian Consultant Association and having qualification A. registered by Construction Services Development Board and having qualification A/Big 4) As specified in the Horizontal Measures 4) As specified in the Horizontal Measures Section Section

Advisory and Consultative 1) Unbound for government funded project 1) Unbound (CPC 86721) 2) Unbound for government funded project 2) Unbound 3) Joint operation through a representative office 3) The Indonesian participant in joint operation in Indonesia must be member of Indonesian Consultant Association 4) Unbound except for director and technical 4) As specified in the Horizontal Measures expert Section Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID N Engineering design services 1) Unbound for government funded project 1) Unbound Page 10 for industrial processes and 2) Unbound for government funded project 2) Unbound production 3) Joint operation through a representative office 3) The Indonesian participant in joint operation (CPC 86725) in Indonesia must be member of Indonesian Consultant Association 4) Unbound except for director and technical 4) As specified in the Horizontal Measures expert Section f. Integrated Engineering 1) Unbound 1) Unbound Services (CPC 8673) 2) None 2) Unbound 3) (a) Joint operation 3) (a) Joint operation : To form a joint operation by establishing a 1. Registration Licence fee requirement representative office 2. Licence for representative office shall be valid for 3 years and can be Licence for representative office shall be extended valid for 3 years and can be extended. 3. 2. Registered foreign company shall form a joint operation with local (b) Joint venture partner(s) which is (are) member(s) To establish a joint venture company by of the Indonesian Consultant fulfilling the requirements as specified in Association having qualification A the Horizontal Measures Section and the registered by Construction Services Foreign Capital Investment Law Development Board and having qualification A/Big

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID g. Urban Planning Services 1) Unbound 1) Unbound N (CPC 86742) 2) None 2) Unbound 3) (a) Joint operation 3) (a) Joint operation : Page 11 To form a joint operation by establishing a 1. Registration Licence fee requirement representative office 2. Licence for representative office shall be valid for 3 years and can be Licence for representative office shall be extended valid for 3 years and can be extended. 3. 2. Registered foreign company shall form a joint operation with local (b) Joint venture partner(s) which is (are) member(s) To establish a joint venture company by of the Indonesian Consultant fulfilling the requirements as specified in Association having qualification A the Horizontal Measures Section and the registered by Construction Services Foreign Capital Investment Law Development Board and having qualification A/Big

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID N B. Computer and Related Page 12 Services a. Consultancy Services 1) Unbound for government funded project 1) Unbound related to the installation of 2) Unbound for government funded project 2) Unbound computer hardware 3) Joint operation through a representative office 3) The Indonesian participant in joint operation (CPC 841) in Indonesia must be member of Indonesian Consultant Association 4) Unbound except for director and technical 4) As specified in the Horizontal Measures expert Section b. Software 1) Unbound for government funded project 1) Unbound implementation 2) Unbound for government funded project 2) Unbound Services (CPC 842) 3) Joint operation through a representative office 3) The Indonesian participant in joint operation in Indonesia must be member of Indonesian Consultant Association 4) Unbound except for director and technical 4) As specified in the Horizontal Measures expert Section

C. Research and Development Services c. Interdisciplinary R & D 1) Unbound for government funded project 1) Unbound (CPC 853, limited to 2) Unbound for government funded project 2) Unbound industrial activities) 3) Joint operation through a representative office 3) The Indonesian participant in joint operation in Indonesia must be member of Indonesian Consultant Association 4) Unbound except for director and technical 4) As specified in the Horizontal Measures expert Section

F. Other Business Services d. Project management 1) Unbound for government funded project 1) Unbound services other than for 2) Unbound for government funded project 2) Unbound construction 3) Joint operation through a representative office 3) The Indonesian participant in joint operation (CPC 86601) in Indonesia must be member of Indonesian Consultant Association 4) Unbound except for director and technical 4) As specified in the Horizontal Measures expert Section Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID e. Technical Testing and 1) Unbound for government funded project 1) Unbound N Analysis Services 2) Unbound for government funded project 2) Unbound (CPC 8676) 3) Joint operation through a representative office 3) The Indonesian participant in joint operation Page 13 in Indonesia must be member of Indonesian Consultant Association 4) Unbound except for director and technical 4) As specified in the Horizontal Measures expert Section i. Services incidental of 1) Unbound for government funded project 1) Unbound manufacturing 2) Unbound for government funded project 2) Unbound (CPC 884 & 885) 3) Joint operation through a representative office 3) The Indonesian participant in joint operation in Indonesia must be member of Indonesian Consultant Association 4) Unbound except for director and technical 4) As specified in the Horizontal Measures expert Section n. Maintenance and repair of 1) Unbound for government funded project 1) Unbound equipment (not including 2) Unbound for government funded project 2) Unbound maritime vessels, aircraft or 3) Joint operation through a representative office 3) The Indonesian participant in a joint operation other transport equipment) in Indonesia must be member of the Indonesian Consultant (CPC 633+8861+8866) Association. 4) Unbound except for director and technical 4) As specified in the Horizontal Measures expert Section Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID N 2. COMMUNICATION Page 14 SERVICES

C. Telecommunication Services All Sub-sectors (i) Indonesia undertakes additional commitments as per reference paper attached (ii) The foreign service supplier must be a world class operator with extensive international experience. (iii) Type approval mechanism is in place (iv) Basic telecommunication service tariff is decided by the government;

Local service: 1) None 1) Unbound The period of exclusivity 2) None 2) Unbound for local services expires - Public switched telephone 3) Local services are provided exclusively by PT 3) None in 2011. The service (CPC 7521) Telkom and 5 regional joint operation scheme Government will conduct - Circuit switched public data operators. a review of policy with network services (CPC Type of legal entity required: respect to whether to 7523**) - Joint venture, permit additional - Teleconferencing services - Joint operation, or suppliers of such services (CPC 75292) - Contract management upon the expiry of this Foreign equity participation is limited to 35 per period. cent. 4) Natural person for management and technical 4) As specified in the Horizontal Measures expert for a JVC is limited to 20 persons. Section Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID Long distance: 1) None 1) Unbound The period of exclusivity N 2) None 2) Unbound for long distance services - Public switched telephone 3) Long distance services are provided by PT 3) None expires in 2006. The Page 15 service (CPC 7521) Telkom exclusively Government will conduct - Circuit switched public data Type of legal entity required: a review of policy with network services - Joint venture respect to whether to (CPC 7523**) - Joint operation or permit additional - Teleconferencing services - Contract management suppliers of such services (CPC 75292) Foreign equity participation is limited to 35 per upon the expiry of this cent. period. 4) Natural person for management and technical 4) As specified in the Horizontal Measures expert for a JVC is limited to 20 persons. Section

International: 1) Only through networks of PT Indosat and PT 1) Unbound The period of exclusivity Satelindo. Callback is not permitted. for international services - Public switched telephone 2) Callback is not permitted. 2) Unbound expires in 2005. The service (CPC 7521) 3) International services are provided exclusively 3) None Government will conduct - Circuit switched public data by PT Indosat and PT Satelindo (duopoly). a review of policy with network services (CPC Type of legal entity required: respect to whether to 7523**) - Joint venture permit additional - Teleconferencing services - Joint operation or suppliers of such services (CPC 75292) - Contract management upon the expiry of this Foreign equity participation is limited to 35 per period. cent. 4) Natural person for management and technical 4) As specified in the Horizontal Measures expert is limited to 20 persons. Section

Packet-switched public data 1) Only through networks of PT Indosat and PT 1) Unbound network services Satelindo (CPC 7523**) 2) None 2) Unbound 3) Three service suppliers are now operating on a 3) None - X. 25 non-exclusive basis - Frame relay Type of legal entity required: - Local - Joint venture or - Local distance - Joint operation - International Foreign equity participation is limited to 35 per cent. 4) Natural person for management and technical 4) As specified in the Horizontal Measures expert is limited to 20 persons. Section Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID N Telex services 1) Only through networks of PT Indosat and PT 1) Unbound Page 16 Satelindo 2) None 2) Unbound 3) Type of legal entity required: 3) Foreign service supplier should be a world - Joint venture or class operator. - Joint operation Foreign equity participation is limited to 35 per cent. 4) Natural person for management and technical 4) As specified in the Horizontal Measures expert limited to 20 persons. Section

Telegraph services 1) Only through networks of PT Indosat and PT 1) Unbound Satelindo 2) None 2) Unbound 3) Type of legal entity required: 3) Foreign service supplier should be a world - Joint venture or class operator. - Joint operation Foreign equity participation is limited to 35 per cent. 4) Natural person for management and technical 4) As specified in the Horizontal Measures expert limited to 20 persons Section

Domestic: 1) None 1) Unbound Mobile cellular telephone 2) None 2) Unbound services 3) Seven operators are now providing service 3) None (CPC 75213) Type of legal entity required: Joint venture Foreign equity participation is limited to 35 per cent 4) Natural person for management and technical 4) As specified in the Horizontal Measures expert for a JVC is limited to 20 persons Section Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID Domestic: 1) None 1) Unbound N Personal Mobile Cellular 2) None 2) Unbound Communication Services 3) New entry only through a joint venture with 3) None Page 17 state-owned company Foreign equity participation is limited to 35 per cent 4) Natural person for management and technical 4) As specified in the Horizontal Measures expert for a JVC is limited to 20 persons. Section

Internet Access Services 1) Until 2005, only through networks of PT 1) Unbound Indosat and PT Satelindo for international access 2) None 2) Unbound 3) More than 30 licences have been issued 3) None Type of legal entity required: - Joint venture or - Joint operation Foreign equity participation is limited to 35 per cent. 4) Natural person for management and technical 4) As specified in the Horizontal Measures expert limited to 20 persons Section

Domestic: 1) None 1) Unbound Regional and National Paging 2) None 2) Unbound Services 3) Currently there are 10 national operators and 3) None (CPC 75291) over 70 local operators. Type of legal entity required - Joint venture or - Joint operation Foreign equity participation is limited to 35 per cent 4) Natural person for management and technical 4) As specified in the Horizontal Measures expert limited to 20 persons Section Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID N Domestic: 1) None 1) Unbound - Division of revenue Page 18 Public payphone services 2) None 2) Unbound between the payphone 3) Provision and management of terminal 3) None operator and PT Telkom equipment for public payphone services are is determined by the now carried out by several local companies. government Type of legal entity required: - Joint venture, - Joint operation, or - Contract management Foreign equity participation is limited to 35 per cent. 4) Natural person for management and technical 4) As specified in the Horizontal Measures expert limited to 20 persons Section

Voice mail service 1) None 1) None (CPC 7523) 2) None 2) None 3) Access granted for five foreign service 3) Higher paid-up capital is required of foreign provider companies, in addition to existing service suppliers than of domestic service companies suppliers. This measure will be eliminated in the year 2020.

4) Unbound except for director and technical 4) As specified in the Horizontal Measures expert Section

Electronic mail services 1) None 1) None (CPC 75232) 2) None 2) None 3) Access granted for five foreign service 3) Higher paid-up capital is required of foreign provider companies, in addition to existing service suppliers than of domestic service companies suppliers. This measure will be eliminated in the year 2020. 4) Unbound except for director and technical 4) As specified in the Horizontal Measures expert Section Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID Computer time sharing 1) None 1) None N services (CPC 84330) 2) None 2) None 3) Access granted for five foreign service 3) Higher paid-up capital is required of foreign Page 19 provider companies, in addition to existing service suppliers than of domestic service companies suppliers. This measure will be eliminated in the year 2020. 4) Unbound except for director and technical 4) As specified in the Horizontal Measures expert Section

Videotex services 1) None 1) None (CPC 75229) 2) None 2) None 3) Access granted for five foreign service 3) Higher paid-up capital is required of foreign provider companies, in addition to existing service suppliers than of domestic service companies suppliers. This measure will be eliminated in the year 2020. 4) Unbound except for director and technical 4) As specified in the Horizontal Measures expert Section

Electronic mail box 1) None 1) None (CPC 75232) 2) None 2) None 3) Access granted for five foreign service 3) Higher paid-up capital is required of foreign provider companies, in addition to existing service suppliers than of domestic service companies suppliers. This measure will be eliminated in the year 2020. 4) Unbound except for director and technical 4) As specified in the Horizontal Measures expert Section

File transfer services 1) None 1) None (CPC 75299) 2) None 2) None 3) Access granted for five foreign service 3) Higher paid-up capital is required of foreign provider companies, in addition to existing service suppliers than of domestic service companies suppliers. This measure will be eliminated in the year 2020. 4) Unbound except for director and technical 4) As specified in the Horizontal Measures expert Section Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID N Home telemetering alarm 1) None 1) None Page 20 (CPC 75299) 2) None 2) None 3) Access granted for five foreign service 3) Higher paid-up capital is required of foreign provider companies, in addition to existing service suppliers than of domestic service companies suppliers. This measure will be eliminated in the year 2020. 4) Unbound except for director and technical 4) As specified in the Horizontal Measures expert. Section

Entertainment services 1) None 1) None (CPC 75299) 2) None 2) None 3) Access granted for five foreign service 3) Higher paid-up capital is required of foreign provider companies, in addition to existing service suppliers than of domestic service companies suppliers. This measure will be eliminated in the year 2020. 4) Unbound except for director and technical 4) As specified in the Horizontal Measures expert Section

Management information 1) None 1) None services (CPC75299) 2) None 2) None 3) Access granted for five foreign service 3) Higher paid-up capital is required of foreign provider companies, in addition to existing service suppliers than of domestic service companies suppliers. This measure will be eliminated in the year 2020. 4) Unbound except for director and technical 4) As specified in the Horizontal Measures expert Section

3. CONSTRUCTION AND RELATED ENGINEERING SERVICES

A. General construction work for building Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID Construction work for 1) Unbound* 1) Unbound* building 2) None 2) Unbound N (CPC 512 except 3) (a) Joint operation 3) (a) Joint operation : Page 21 CPC 51210) To form a joint operation by establishing a 1. Registration Licence fee representative office in Indonesia. requirement 2. Licence for representative office Licence for representative office shall be shall be valid for 3 years and can be valid for 3 years and can be extended extended 3 2. Registered foreign company shall (b) Joint venture form a joint operation with local To establish a joint venture company by partner(s) which is (are) member(s) fulfilling the requirements as specified in of the Indonesian Contractors the Horizontal Measures Section and the Association having qualification A Foreign Capital Investment Law registered by Construction Services Development Board and having Not more than 55% of the capital share qualification A/Big of the Limited Liability Enterprise (b) Joint venture : (Perseroan Terbatas/PT) may be owned Local partner(s) in joint venture shall be by foreign partner(s) member(s) of the Indonesian Contractors Association and having qualification A registered by Construction Services Development Board and having qualification A/Big 4) As specified in the Horizontal Measures 4) As specified in the Horizontal Measures Section Section Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID N B. General construction work Page 22 for civil engineering

Construction work for civil 1) Unbound* 1) Unbound* engineering 2) None 2) Unbound (CPC 513) 3) (a) Joint operation 3) (a) Joint operation : To form a joint operation by establishing a 1. Registration Licence fee representative office in Indonesia. requirement 2. Licence for representative office Licence for representative office shall be shall be valid for 3 years and can be valid for 3 years and can be extended extended 3. 2.Registered foreign company shall form a (b) Joint venture joint operation with local partner(s) To establish a joint venture company by which is (are) member(s) of the fulfilling the requirements as specified in Indonesian Contractors Association the Horizontal Measures Section and the having qualification A registered by Foreign Capital Investment Law Construction Services Development Board and having qualification Not more than 55% of the capital share A/Big of the Limited Liability Enterprise (Perseroan Terbatas/PT) may be owned (b) Joint venture : by foreign partner(s) Local partner(s) in joint venture shall be member(s) of the Indonesian Contractors Association and having qualification A registered by Construction Services Development Board and having qualification A/Big 4) As specified in the Horizontal Measures 4) As specified in the Horizontal Measures Section Section Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID C. Installation and assembly N work Page 23 Assembly and erection of 1) Unbound* 1) Unbound* prefabricated construction 2) None 2) Unbound (CPC 514 - 5140) 3) (a) Joint operation 3) (a) Joint operation : To form a joint operation by establishing a 1. Registration Licence fee representative office in Indonesia. requirement 2. Licence for representative office Licence for representative office shall be shall be valid for 3 years and can be valid for 3 years and can be extended extended 3 2. Registered foreign company shall (b) Joint venture form a joint operation with local To establish a joint venture company by partner(s) which is (are) fulfilling the requirements as specified in member(s) of the Indonesian the Horizontal Measures Section and the Contractors Association having Foreign Capital Investment Law qualification A registered by Construction Services Not more than 55% of the capital share Development Board and having of the Limited Liability Enterprise qualification A/Big (Perseroan Terbatas/PT) may be owned (b) Joint venture : by foreign partner(s) Local partner(s) in joint venture shall be member(s) of the Indonesian Contractors Association and having qualification A registered by Construction Services Development Board and having qualification A/Big 4) As specified in the Horizontal Measures 4) As specified in the Horizontal Measures Section Section Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID N E. Other Page 24 - Pre-erection work at 1) Unbound* 1) Unbound* construction system 2) None 2) Unbound (CPC 511 except CPC 3) (a) Joint operation 3) (a) Joint operation : 51110 and 51113) To form a joint operation by establishing a 1. Registration Licence fee representative office in Indonesia. requirement 2. Licence for representative office Licence for representative office shall be shall be valid for 3 years and can be valid for 3 years and can be extended extended 3 2. Registered foreign company shall (b) Joint venture form a joint operation with local To establish a joint venture company by partner(s) which is (are) member(s) fulfilling the requirements as specified in of the Indonesian Contractors the Horizontal Measures Section and the Association having qualification A Foreign Capital Investment Law registered by Construction Services Development Board and having Not more than 55% of the capital share qualification A/Big of the Limited Liability Enterprise (b) Joint (Perseroan Terbatas/PT) may be owned venture : by foreign partner(s) Local partner(s) in joint venture shall be member(s) of the Indonesian Contractors Association and having qualification A registered by Construction Services Development 4) As specified in the Horizontal Measures Board and having qualification A/Big Section 4) As specified in the Horizontal Measures Section Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID - Special trade 1) Unbound* 1) Unbound* N construction work 2) None 2) Unbound (CPC 515 - 5155) 3) (a) Joint operation 3) (a) Joint operation : Page 25 To form a joint operation by establishing a 1. Registration Licence fee representative office in Indonesia. requirement 2. Licence for representative office Licence for representative office shall be shall be valid for 3 years and can be valid for 3 years and can be extended extended 3. 2. Registered foreign company shall (b) Joint venture form a joint operation with local To establish a joint venture company by partner(s) which is (are) member(s) fulfilling the requirements as specified in of the Indonesian Contractors the Horizontal Measures Section and the Association having qualification A Foreign Capital Investment Law registered by Construction Services Development Board and having Not more than 55% of the capital share qualification A/Big of the Limited Liability Enterprise (b) Joint venture : (Perseroan Terbatas/PT) may be owned Local partner(s) in joint venture shall be by foreign partner(s) member(s) of the Indonesian Contractors Association and having qualification A registered by Construction Services Development Board and having qualification A/Big 4) As specified in the Horizontal Measures 4) As specified in the Horizontal Measures Section Section Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID N - Renting Services 1) Unbound* 1) Unbound* Page 26 related to equipment 2) None 2) Unbound for construction or 3) (a) Joint operation 3) (a) Joint operation : demolition of building To form a joint operation by establishing a 1. Registration Licence fee or civil engineering representative office in Indonesia. requirement works, with operator 2. Licence for representative office (CPC 518) Licence for representative office shall be shall be valid for 3 years and can be valid for 3 years and can be extended extended 3. 2. Registered foreign company shall (b) Joint venture form a joint operation with local To establish a joint venture company by partner(s) which is (are) member(s) fulfilling the requirements as specified in of the Indonesian Contractors the Horizontal Measures Section and the Association having qualification A Foreign Capital Investment Law registered by Construction Services Development Board and having Not more than 55% of the capital share qualification A/Big of the Limited Liability Enterprise (b) Joint venture : (Perseroan Terbatas/PT) may be owned Local partner(s) in joint venture shall be by foreign partner(s) member(s) of the Indonesian Contractors Association and having qualification A registered by Construction Services Development Board and having qualification A/Big 4) As specified in the Horizontal Measures 4) As specified in the Horizontal Measures Section Section Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID 1) Unbound* 1) Unbound* N - 2) None 2) Unbound 3) (a) Joint operation by establishing a 3) (a) 1. Licence fee requirement Page 27 Foun representative office in Indonesia. 2. Registered foreign company shall datio form a joint operation with local n Licence for representative office shall be partner(s) which is (are) registered by work valid for 3 years and can be extended Construction Services Development Board and having qualification A/Big (b) Joint venture company by fulfilling the (b) Local partner(s) in joint venture shall inclu requirements as specified in the be registered by Construction Services ding Horizontal Section and the Foreign Development Board and having pile Capital Investment Law qualification A/Big drivi ng Not more than 55% of the capital share of the Limited Liability Enterprise (Perseroan Terbatas/PT) may be owned (CP by foreign partner(s) C 4) As specified in the Horizontal Section 4) As specified in the Horizontal Section 5151 0)

- Gas fitting 1) Unbound* 1) Unbound* construction work 2) None 2) Unbound (CPC 51630) 3) (a) Joint operation by establishing a 3) (a) 1. Licence fee requirement representative office in Indonesia. 2. Registered foreign company shall form a joint operation with local Licence for representative office shall be partner(s) which is (are) registered valid for 3 years and can be extended by Construction Services Development Board and having (b)Joint venture company by fulfilling the qualification A/Big requirements as specified in the (b) Local partner(s) in joint venture shall Horizontal Section and the Foreign be registered by Construction Services Capital Investment Law Development Board and having qualification A/Big Not more than 55% of the capital share of the Limited Liability Enterprise (Perseroan Terbatas/PT) may be owned by foreign partner(s) 4) As specified in the Horizontal Section 4) As specified in the Horizontal Section Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID N - Fire alarm 1) Unbound* 1) Unbound* Page 28 construction work 2) None 2) Unbound (CPC 51642) 3) (a) Joint operation by establishing a 3) (a) 1. Licence fee requirement representative office in Indonesia. 2. Registered foreign company shall form a joint operation with local Licence for representative office shall be partner(s) which is (are) registered valid for 3 years and can be extended by Construction Services Development Board and having (b)Joint venture company by fulfilling the qualification A/Big requirements as specified in the (b) Local partner(s) in joint venture shall Horizontal Section and the Foreign be registered by Construction Services Capital Investment Law Development Board and having qualification A/Big Not more than 55% of the capital share of the Limited Liability Enterprise (Perseroan Terbatas/PT) may be owned by foreign partner(s) 4) As specified in the Horizontal Section 4) As specified in the Horizontal Section

- Burglar alarm system 1) Unbound* 1) Unbound* construction work 2) None 2) Unbound (CPC 51643) 3) (a) Joint operation by establishing a 3) (a) 1. Licence fee requirement representative office in Indonesia. 2. Registered foreign company shall form a joint operation with local Licence for representative office shall be partner(s) which is (are) registered valid for 3 years and can be extended by Construction Services Development Board and having (c) Joint venture company by fulfilling the qualification A/Big requirements as specified in the (b) Local partner(s) in joint venture shall Horizontal Section and the Foreign be registered by Construction Services Capital Investment Law Development Board and having qualification A/Big Not more than 55% of the capital share of the Limited Liability Enterprise (Perseroan Terbatas/PT) may be owned by foreign partner(s) 4) As specified in the Horizontal Section 4) As specified in the Horizontal Section Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID 1) Unbound* 1) Unbound* N - 2) None 2) Unbound 3) (a) Joint operation by establishing a 3) (a) 1. Licence fee requirement Page 29 Lift representative office in Indonesia. 2. Registered foreign company shall and form a joint operation with local escal Licence for representative office shall be partner(s) which is (are) registered ator valid for 3 years and can be extended by Construction Services Development Board and having (b)Joint venture company by fulfilling the qualification A/Big const requirements as specified in the (b) Local partner(s) in joint venture shall ructi Horizontal Section and the Foreign be registered by Construction Services on Capital Investment Law Development Board and having work qualification A/Big Not more than 55% of the capital share of the Limited Liability Enterprise (Perseroan Terbatas/PT) may be owned (CP by foreign partner(s) C 4) As specified in the Horizontal Section 4) As specified in the Horizontal Section 5169 1) 5. EDUCATIONAL SERVICES

General conditions on education services

Commercial presence of the foreign service provider is permitted only through an education institution which is registered in Indonesia and must meet the following conditions :

1. Mutual recognition arrangement between relevant institutions on credits, programs, and certifications is required. 2. Foreign education institution providing services must establish partnership with local partner. Foreign language instructors must be native speakers. 3. Foreign education institution must be listed in the Ministry of Education’s List of Accredited Foreign Education and its local partner must be accredited. 4. Foreign education institution in cooperation with local partner may open education institution in the cities of Jakarta, Bogor, Bandung, Yogyakarta, and Medan. 5. Temporary entry for natural persons engaged in education activities in Indonesia is subject to approval by the Ministry of National Education. Approval is granted on case-by-case basis. Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID N B. Secondary education Page 30 services : Technical and vocational 1) None 1) None secondary education 2) None 2) None services (electronic, 3) See Horizontal Section and General 3) Unbound automotive) Conditions (CPC 92230) 4) Unbound except as indicated in the 4) As indicated in the Horizontal Section and Horizontal Section and General Conditions General Conditions

C. Higher education services 1) None 1) None (CPC 923) 2) None 2) None 3) See Horizontal Section and General 3) Unbound Conditions 4) Unbound except as indicated in the 4) Unbound Horizontal Section and General Conditions

Post secondary technical 1) None 1) None and vocational education 2) None 2) None services (Polytechnique 3) See Horizontal Section and General 3) Unbound Machine and Electrical) Conditions (CPC 92310) 4) Unbound except as indicated in the 4) Unbound Horizontal Section and General Conditions

D. Adult education 1) None 1) None (CPC 924) 2) None 2) None Language courses and 3) See Horizontal Section and General 3) Unbound training Conditions 4) Unbound except as indicated in the 4) Unbound Horizontal Section and General Conditions

E. Other education services (CPC 92900 ) Football and chess only 1) None 1) None 2) None 2) None 3) See Horizontal Section and General 3) Unbound Conditions 4) Unbound except as indicated in the 4) Unbound Horizontal Section and General Conditions Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID FINANCIAL SERVICES N General condition on Non Banking Financial Services Sub-sector : Page 31

1) All market access and national treatment limitations specified in the Non Banking Financial Services Sub-sectors will be eliminated by the year 2020 subject to similar commitment by other members.

2) The share ownership of foreign services suppliers is bound at the prevailing laws and regulations. The conditions of ownership and the percentage share of ownership as stipulated in the respective shareholder agreement establishing the existing individual joint venture in non banking financial services shall be respected. No transfer of ownership shall take place without the consent of all parties in the joint venture concerned.

3) Limitation on national treatment in terms of taxation which is specified in the Horizontal Measures is not applied on the Non Banking Financial Services Sub-sector.

4) In addition to the Horizontal Measures, temporary entry will be granted to technical expert(s)/advisor(s) for no longer than 3 (three) months per person for any given year.

5) Share of non-bank financial companies listed in the stock exchange may be 100% owned by foreign investors.

6) In relation to the presence of natural person, only directors, managers, and experts/advisors can be assumed by expatriates with maximum stay of 3 (three) years and can be extended.

7) All joint venture companies shall provide training for their employees.

8) Limitation on national treatment in terms of difference in paid up capital requirement will be eliminated in the year 1998. Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID N Non-Life Insurance Services 1) Unbound 1) Unbound Page 32 (CPC 8129) 2) Unbound except if: 2) Unbound (a) There is no insurance company in Indonesia, either individually or group, which could handle the insurance risks of the object in question. (b) There is no insurance company in Indonesia which want to carry out an insurance coverage of the object in question. (c) The owners of insurance objects in question are not Indonesian citizens or Indonesian legal entities. 3) As specified in the Horizontal Measures 3) As specified in the General Conditions. Section and General Conditions. 4) Unbound except for director and technical 4) As specified in the Horizontal Measures advisor/expert. Section.

Reinsurance Services 1) Reinsurance service suppliers from other 1) None Members must be rated minimum as BBB by Standard and Poor or equivalent. 2) Reinsurance service suppliers from other 2) Unbound Members must be rated minimum as BBB by Standard and Poor or equivalent. 3) As specified in the Horizontal Measures 3) As specified in the General Conditions. Section and General Conditions. 4) Unbound except for director and technical 4) As specified in the Horizontal Measures advisor/expert. Section. Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID Life Insurance Services 1) Unbound 1) Unbound N (CPC 8121) 2) Unbound except if: 2) Unbound (a) There is no insurance company in Page 33 Indonesia, either individually or group, which could handle the insurance risks of the object in question. (b) There is no insurance company in Indonesia which wants to carry out an insurance coverage of the object in question. (c) The owners of insurance objects in question are not Indonesian citizens or Indonesian legal entities. 3) As specified in the Horizontal Measures 3) As specified in the General Conditions. Section and General Conditions. 4) Unbound except for director and technical 4) As specified in the Horizontal Measures advisor/expert. Section.

Insurance Brokerage Services 1) Unbound 1) None (CPC 8140) 2) None 2) None 3) As specified in the Horizontal Section and 3) As specified in the General Conditions. General Conditions. 4) Unbound except for director and technical 4) As specified in the Horizontal Section. advisor/expert.

Reinsurance Brokerage Services 1) Unbound 1) None (CPC 8140) 2) None 2) None 3) As specified in the Horizontal Measures 3) As specified in the General Conditions. Section and General Conditions. 4) Unbound except for director and technical 4) As specified in the Horizontal Measures advisor/expert. Section.

Financial Lease Services 1) None 1) None (CPC 81120) 2) None 2) None 3) As specified in the Horizontal Measures 3) As specified in the General Conditions. Section and General Conditions. 4) Unbound except as indicated in the Horizontal 4) As specified in the Horizontal Measures Measures Section. Section. Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID N Factoring Services 1) Unbound except for international factoring 1) Unbound Page 34 (CPC 8113) transaction. 2) None 2) None 3) As specified in the Horizontal Measures 3) As specified in the General Conditions. Section and General Conditions. 4) Unbound except as indicated in the Horizontal 4) As specified in the Horizontal Measures Measures Section. Section. b. Credit Card Business 1) None 1) None (Issuer and Agent of Credit 2) None 2) None Card) 3) As specified in the Horizontal Measures 3) As specified in the General Conditions. (CPC 8113) Section and General Conditions. 4) Unbound except as indicated in the Horizontal 4) As specified in the Horizontal Measures Measures Section. Section.

Consumers Finance Services 1) None 1) None (CPC 8113) 2) None 2) None 3) As specified in the Horizontal Measures 3) As specified in the General Conditions. Section and General Conditions. 4) Unbound except as indicated in the Horizontal 4) As specified in the Horizontal Measures Measures Section. Section.

Securities Business 1) Unbound 1) Unbound - Trading for own account or 2) None 2) None for account of customers, on 3) Through establishment of a securities 3) As specified in the General Conditions. an exchange or over-the broker/dealer. counter market 4) Unbound except as indicated in the Horizontal 4) As specified in the Horizontal Measures Measures Section. Section. - Listed shares

- Bonds

Participation in issues of 1) Unbound 1) Unbound securities, including 2) None 2) None underwriting and placement as 3) Through establishment of a securities 3) As specified in the General Conditions. agent (whether publicly or underwriter company. privately), and provision of 4) Unbound except as indicated in the Horizontal 4) As specified in the Horizontal Measures services related to such issues Measures Section. Section. Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID Portfolio management, all forms 1) Unbound 1) Unbound N of collective investment 2) None 2) None management 3) Through establishment of an investment 3) As specified in the General Conditions. Page 35 management company. 4) Unbound except for directors. 4) As specified in the Horizontal Measures Section. Asset Management limited only 1) Unbound 1) Unbound to investment fund management 2) None 2) None 3) Through establishment of an investment 3) As specified in the General Conditions. management company. 4) Unbound except for directors. 4) As specified in the Horizontal Measures Section.

Investment Advisory Services 1) Unbound 1) Unbound limited only to investment 2) None 2) None advisory in capital market 3) Through establishment of an investment 3) As specified in the General Conditions. management company. 4) Unbound except for directors. 4) As specified in the Horizontal Measures Section. Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID N Banking Sub-sector : General Conditions on Banking Sub-sector. Page 36 1. All Market Access and National Treatment limitation specified in the banking sub-sector will be eliminated by the year 2020 subject to similar commitment by other members.

2. With the exception of the existing branches of foreign banks, foreign services provider shall be in the form of joint venture bank locally incorporated in Indonesia with the following requirements:

(a) Unbound for new license (b) Only bank financial institutions are permitted to establish joint venture banks.

3. The share ownership of foreign services supplier in the joint venture bank is bound at prevailing laws and regulation. The conditions of ownership and the percentage share of ownership as stipulated in the respective shareholder agreement establishing the existing individual joint venture bank shall be respected as the basis of ownership of the foreign service provider(s) and their Indonesian partner(s). No transfer of ownership shall take place without the consent of all parties in the joint venture bank concerned.

4. Acquisition of local existing banks is allowed through the purchase of up to 49% 51% of the shares of locally incorporated bank listed in the stock exchange.

5. Limitation on national treatment in terms of difference in paid up capital requirement will be eliminated in the year 1998.

6. Foreign bank and joint ventures bank may open their offices in the cities of Jakarta, Surabaya, Semarang, Bandung, Medan, Ujun Pandang Makasar, Denpasar , and Batam Island, Padang, Manado, and Ambon

7. With respect to the presence of natural persons no economic needs test will apply. A non Indonesian employed as manager or as technical expert shall have at least two Indonesian under studies during his/her term.

8. In addition to the Horizontal Measures, temporary entry will be granted to technical expert(s)/advisor(s) of branch office of the foreign bank and joint venture bank for no longer than 3 (three) months per person for any given year.

9. Limitation on national treatment in terms of taxation which is specified in Horizontal Measures is not applied on the Banking Sub-sector. Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID Commercial Banking Business N (i) Acceptance of deposits and 1) None 1) None Page 37 other repayable funds from 2) None 2) None the public 3) (a) Bound only 1 (one) 2 (two) sub-branches 3) (a) For foreign bank branch, only executive and 1 (one) 2 (two) auxiliary offices for position can be assumed by expatriates foreign bank's branch office. with limitation that at least one of them shall be Indonesian national. (b) Bound only 1 (one) 2 (two) branches and (b) For the joint venture bank, only for the 1 (one) 2 (two) sub-branches for joint director can be assumed by the expatriates venture bank. in proportion to the ownership sharing. 4) Unbound except as indicated in the Horizontal 4) Unbound except as indicated in the Horizontal Measures Section and General Conditions on Measures Section and General Conditions on Banking Sub-sector. Banking Sub-sector.

(ii) Lending of all types, 1) None 1) None including consumer credit, 2) None 2) None mortgage, credit, factoring, 3) (a) Bound only 1 (one) 2 (two) sub-branches 3) (a) For foreign bank branch, only executive and financing of and 1 (one) 2 (two) auxiliary offices for position can be assumed by expatriates commercial transaction foreign bank's branch office. with limitation that at least one of them shall be Indonesian national. (b) Bound only 1 (one) 2 (two) branches and (b) For the joint venture bank, only for the 1 (one) 2 (two) sub-branches for joint director can be assumed by the expatriates venture bank. in proportion to the ownership sharing. 4) Unbound except as indicated in the Horizontal 4) Unbound except as indicated in the Horizontal Measures Section and General Conditions on Measures Section and General Conditions on Banking Sub-sector. Banking Sub-sector. Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID N (iii) All payment and money 1) None 1) None Page 38 transmission services 2) None 2) None including credit, charge and 3) (a) Bound only 1 (one) 2 (two) sub-branches 3) (a) For foreign bank branch, only executive debit cards, travellers and 1 (one) 2 (two) auxiliary offices for position can be assumed by expatriates cheques and bankers drafts foreign bank's branch office. with limitation that at least one of them shall be Indonesian national. (b) Bound only 1 (one) 2 (two) branches and 1 (b) For the joint venture bank, only for the (one) 2 (two) sub-branches for joint director can be assumed by the expatriates venture bank. in proportion to the ownership sharing. 4) Unbound except as indicated in the Horizontal 4) Unbound except as indicated in the Horizontal Measures Section and General Conditions on Measures Section and General Conditions on Banking Sub-sector. Banking Sub-sector.

(iv) Guarantees and 1) None 1) None Commitments 2) None 2) None 3) (a) Bound only 1 (one) 2 (two) sub-branches 3) (a) For foreign bank branch, only executive and 1 (one) 2 (two) auxiliary offices for position can be assumed by expatriates with foreign bank's branch office. limitation that at least one of them shall be Indonesian national. (b) Bound only 1 (one) 2 (two) branches and (b) For the joint venture bank, only for the 1 (one) 2 (two) sub-branches for joint venture director can be assumed by the expatriates in bank. proportion to the ownership sharing.

4) Unbound except as indicated in the Horizontal 4) Unbound except as indicated in the Horizontal Measures Section and General Conditions on Measures Section and General Conditions on Banking Sub-sector. Banking Sub-sector. Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID (v) Trading for own account or 1) None 1) None N for account of customers, 2) None 2) None whether on an exchange, in 3) (a) Bound only 1 (one) 2 (two) sub-branches 3) (a) For foreign bank branch, only executive Page 39 an over-the-counter market and 1 (one) 2 (two) auxiliary offices for position can be assumed by expatriates or otherwise, the following: foreign bank's branch office. with limitation that at least one of them - Money market (b) Bound only 1 (one) 2 (two) branches and 1 shall be Indonesian national. instruments (including (one) 2 (two) sub-branches for joint (b) For the joint venture bank, only for the cheques, bills, venture bank. director can be assumed by the expatriates certificates of in proportion to the ownership sharing. deposits) 4) Unbound except as indicated in the Horizontal 4) Unbound except as indicated in the Horizontal Measures Section and General Conditions on Measures Section and General Conditions on Banking Sub-sector. Banking Sub-sector.

- Foreign Exchange 1) None 1) None 2) None 2) None 3) (a) Bound only 1 (one) 2 (two) sub-branches 3) (a) For foreign bank branch, only executive and 1 (one) 2 (two) auxiliary offices for position can be assumed by expatriates foreign bank's branch office. with limitation that at least one of them shall be Indonesian national. (b) Bound only 1 (one) 2 (two) branches and (b) For the joint venture bank, only for the 1 (one) 2 (two) sub-branches for joint director can be assumed by the expatriates venture bank. in proportion to the ownership sharing. 4) Unbound except as indicated in the Horizontal 4) Unbound except as indicated in the Horizontal Measures Section and General Conditions on Measures Section and General Conditions on Banking Sub-sector. Banking Sub-sector.

- Exchange rate and 1) None 1) None interest rate 2) None 2) None instruments, including 3) (a) Bound only 1 (one) 2 (two) sub-branches 3) (a) For foreign bank branch, only executive products such as and 1 (one) 2 (two) auxiliary offices for position can be assumed by expatriates swaps, forward rate foreign bank's branch office. with limitation that at least one of them agreements shall be Indonesian national. (b) Bound only 1 (one) 2 (two) branches and 1 (b) For the joint venture bank, only for the (one) 2 (two) sub-branches for joint venture director can be assumed by the expatriates bank. in proportion to the ownership sharing. 4) Unbound except as indicated in the Horizontal 4) Unbound except as indicated in the Horizontal Measures Section and General Conditions on Measures Section and General Conditions on Banking Sub-sector. Banking Sub-sector. Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID N - Transferable securities 1) None 1) None Page 40 issued in the money 2) None 2) None market 3) (a) Bound only 1 (one) 2 (two) sub-branches 3) (a) For foreign bank branch, only executive and 1 (one) 2 (two) auxiliary offices for position can be assumed by expatriates foreign bank's branch office. with limitation that at least one of them shall be Indonesian national. (b) Bound only 1 (one) 2 (two) branches and 1 (b) For the joint venture bank, only for the (one) 2 (two) sub-branches for joint venture director can be assumed by the expatriates bank. in proportion to the ownership sharing. 4) Unbound except as indicated in the Horizontal 4) Unbound except as indicated in the Horizontal Measures Section and General Conditions on Measures Section and General Conditions on Banking Sub-sector. Banking Sub-sector.

(vi) Cash management, 1) None 1) None custodial and depository 2) None 2) None services 3) (a) Bound only 1 (one) 2 (two) sub-branches 3) (a) For foreign bank branch, only executive and 1 (one) 2 (two) auxiliary offices for position can be assumed by expatriates foreign bank's branch office. with limitation that at least one of them (b) Bound only 1 (one) 2 (two) branches and 1 shall be Indonesian national. (one) 2 (two) sub-branches for joint (b) For the joint venture bank, only for the venture bank. director can be assumed by the expatriates in proportion to the ownership sharing. 4) Unbound except as indicated in the Horizontal 4) Unbound except as indicated in the Horizontal Measures Section and General Conditions on Measures Section and General Conditions on Banking Sub-sector. Banking Sub-sector.

9. HEALTH RELATED AND SOCIAL SERVICES

General conditions on health related and social services :

Commercial presence of the foreign service provider is permitted only through health institution which is registered in Indonesia and must establish partnership with local partner. Establishment limited to the cities of Medan and Surabaya. Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID Hospital services (only for 1) None 1) None N specialistic and super 2) None 2) None specialistic medical care/more 3) As indicated in the Horizontal Section and 3) The health professionals shall be Page 41 specific than specialistic General Conditions : Indonesian. medical care, provided by - The hospital shall be managed by hospital of more than 400 Board of Directors chaired by beds) Indonesian medical doctor (CPC 9311) - Approval subject to the social function of hospital services offered - The medical services shall be provided by persons with medical licenses issued by Ministry of Health and Health professional organization/council 4) Unbound 4) Unbound Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID N 9. TOURISM AND TRAVEL Page 42 RELATED SERVICES Hotels 1 1),2) None 1),2) None (3, 4 and 5 star hotels) 3) In eastern part of Indonesia, Kalimantan, 3) a) Higher paid-up capital is required of Bengkulu, Jambi and Sulawesi, 100 % of capital foreign service suppliers than of domestic share can be owned by foreign investor service suppliers. This measure will be eliminated in the year 2020 b) Only 3,4 or 5 starred hotels are permitted

4) a) Unbound except for: 4) As specified in the Horizontal Measures 1.Top Management Level in Hotel Section business comprised of: i) General Manager ii) Food and Beverage Manager iii) Resident Manager iv) Comptroller v) Marketing Director 2. Highly Skilled Professionals comprised of: i) Exécutive Chef ii) Sous Chef iii) Speciality Cook

B. Travel Agent and Tour 1) None 1) None Operator (TA & TO) 2) None 2) None (CPC 74710) 3) Maximum service providers 30 TA & TO 3) Tour operator must be Travel Agent located in Jakarta and Bali 4) Unbound except for technical advisor 4) As specified in the Horizontal Measures Section

1Starred Hotel is a service business which provides accommodation and food and beverages facilities and other services, except casino and other activities prohibited by law; against for reasons of public moral, religion, security and public order. Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID Tourist Resorts Include2 1),2) None 1),2) None N 3) In eastern part of Indonesia, Kalimantan, 3) a) Higher paid-up capital is required of - Hotel (3, 4 and 5 stars) Bengkulu, Jambi and Sulawesi, 100% of foreign service suppliers than of domestic Page 43 - Marinas capital share can be owned by foreign investor service suppliers. This measure will be - Golf Courses and other eliminated in the year 2020 Sport facilities b) Only 3,4 or 5 starred hotels are permitted

4) Unbound except for Resort Manager 4) As specified in the Horizontal Measures Section

11. TRANSPORT SERVICES A. Maritime Transport Services*)

(a) International Passenger 1) None 1) Foreign Shipping Company is obliged to Access to and use of port transport (CPC 7211) appoint Indonesian Shipping Company or joint facilities in the port which is venture Shipping Company as its General opened for international Agent ***) **) shipping, including but not 2) None 2) None limited to ****): 3) Foreign Shipping Companies may established 3) As specified in the Horizontal Measures Tanjung Priok, Tanjung Owner’s Representative **) Section Perak, Belawan, Makassar, 4) a) Joint venture: As specified in the 4) As specified in the Horizontal Measures Semarang, Dumai, Panjang, Horizontal Measures Section Section Batam, Balikpapan, b) Owner’s Representative: Unbound except Banjarmasin, Bitung, for manager. Pontianak, Ambon, Sorong.

2Tourist Resort is an area built to accommodate the facilities needed for the tourist such as hotels, marinas, golf courses, cultural open stage and other facilities, except casino and other activities prohibited by law; against for reasons of public moral, religion, security and public order. Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID N (b) International Freight 1) None 1) a) Foreign Shipping Company is obliged to Access to and use of port Page 44 Transport (CPC 7212) appoint Indonesian Shipping Company or facilities in the port which is joint venture Shipping Company as its opened for international General Agent ***) **) shipping, including but not b) Government’ Cargo ****) ***) limited to ****): 2) None 2) None Tanjung Priok, Tanjung 3) Foreign Shipping Companies may established 3) As specified in the Horizontal Measures Perak, Belawan, Makassar, Owner’s Representative **) Section Semarang, Dumai, Panjang, 4) a) Joint venture: As specified in the 4) As specified in the Horizontal Measures Batam, Balikpapan, Horizontal Measures Section Section Banjarmasin, Bitung, b) Owner’s Representative: Unbound except Pontianak, Ambon, Sorong. for manager.

Maritime Auxiliary Services 1) Unbound1 except for-no limitation on 1) Unbound1 except for-no limitation on a. Maritime cargo transhipment (board to board or via the transhipment (board to board or via the handling services quay) and/or on the use of on-board cargo quay) and/or on the use of on-board cargo handling handling 2) None 2) None

3) a. Only through joint venture corporation: 3) As indicated in the Horizontal Section as specified in the Horizontal Section b. Allowed to operate only in main ports, such as : Tanjung Priok, Tanjung Perak, Belawan, Semarang, and Makasar. 4) As indicated in the Horizontal Section 4) As indicated in the Horizontal Section

1 A commitment on this mode of delivery is not feasible 1 Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID Notes (Maritime) : N *): Passenger and freight transportation excluding cabotage and auxiliary services Page 45 **): Owner’s representative appointed by foreign shipping company has the following tasks : a) to monitor his vessels during operational activities in Indonesian ports; b) to supervise activities done by its General Agent in servicing of its vessels, calling in Indonesia; c) to make direct contact with cargo owner’s.

***): The tasks of General Agents in Indonesia inter alia are as follows: **): a) o make arrangement in order to get all necessary port services as required by the foreign vessel concerned during their stay in Indonesia ports; b) to appoint stevedoring company for cargo loading and unloading on behalf of its principal; c) to arrange cargo booking and canvassing; d) to collect freight on behalf of the principal; e) to issue Bill of Lading on behalf of the principal; f) to settle the disbursement and claim (if any); g) to give information as required by its principal;

****): Government’s Cargo is cargo originated from the other countries (import cargoes) purchased by the Government Agencies or based on loan/credit ***): agreement with the other countries.

****): These ports are currently opened for international trade and may be added or reduce in the future.

12. OTHER SERVICES NOT INCLUDE ELSEWHERE Energy Services General condition on energy services - Indonesia’s Schedule of Specific Commitments on energy services sector based on Indonesian proposal of energy services classification

Core analysis and other Lab 1) Unbound for government funded project 1) Unbound Test, only for Isotop Analysis 2) Unbound for government funded project 2) Unbound (1A.2.7.3) 3) Joint operation through a representative 3) As specified in the Horizontal Section office in Indonesia 4) Unbound, except for directors and technical 4) As specified in the Horizontal Section experts. Modes of supply: (1) Cross-border supply (2) Consumption abroad (3) Commercial presence (4) Presence of natural persons

Sector or subsector Limitations on market access Limitations on national treatment Additional commitments TN/S/O/ID N Geological and geophysical 1) Unbound for government funded project 1) Unbound services, only for seismic data 2) Unbound for government funded project 2) Unbound Page 46 acquisition (1A.1.4.1.1) 3) Joint operation through a representative 3) As specified in the Horizontal Section office in Indonesia 4) Unbound, except for directors and technical 4) As specified in the Horizontal Section experts.

Liquefaction and gasification 1) Unbound for government funded project 1) None only for coal (2.2.2) 2) Unbound for government funded project 2) None 3) Joint operation through a representative 3) As specified in the Horizontal Section office in Indonesia 4) Unbound, except for directors and technical 4) As specified in the Horizontal Section experts. TN/S/O/IDN Page 47

ATTACHMENT TO THE REPUBLIC OF INDONESIA SCHEDULE ON BASIC TELECOMMUNICATIONS

REFERENCE PAPER

The following are definitions and principles on the regulatory framework for the basic telecommunications services.

Definitions

Users mean service consumers and service suppliers.

Essential facilities mean facilities of a public telecommunications transport network or service that

(a) are exclusively or predominantly provided by a single or limited number of suppliers; and

(b) cannot feasibly be economically or technically substituted in order to provide a service.

A major supplier is a supplier which has the ability to materially affect the terms of participation (having regard to price and supply) in the relevant market for basic telecommunications services as a result of:

(a) control over essential facilities; or

(b) use of its position in the market.

1. Competitive safeguards

1.1 Prevention of anti-competitive practices in telecommunications

Appropriate measures shall be maintained for the purpose of preventing suppliers who, alone or together, are a major supplier from engaging in or continuing anti-competitive practices.

1.2 Safeguards

The anti-competitive practices referred to above shall include in particular:

(a) engaging in anti-competitive cross-subsidization;

(b) using information obtained from competitors with anti-competitive results; and

(c) not making available to other services suppliers on a timely basis technical information about essential facilities and commercially relevant information which are necessary for them to provide services. TN/S/O/IDN Page 48

2. Interconnection

2.1 This section applies to linking with suppliers providing public telecommunications transport networks or services in order to allow the users of one supplier to communicate with users of another supplier and to access services provided by another supplier, where specific commitments are undertaken.

2.2 Interconnection to be ensured

Interconnection with a major supplier will be ensured at any technically feasible point in the network. Such interconnection is provided.

(a) under non-discriminatory terms, conditions (including technical standards and specifications) and rates and of a quality no less favourable than that provided for its own like services or for like services of non-affiliated service suppliers or for its subsidiaries or other affiliates;

(b) in a timely fashion, on terms, conditions (including technical standards and specifications) and cost-oriented rates that are transparent, reasonable, having regard to economic feasibility, and sufficiently unbundled so that the supplier need not pay for network components or facilities that it does not require for the service to be provided; and

(c) upon request, at points in addition to the network termination points offered to the majority of users, subject to charges that reflect the cost of construction of necessary additional facilities.

2.3 Public availability of the procedures for interconnection negotiations

The procedures applicable for interconnection to a major supplier will be made publicly available.

2.4 Transparency of interconnection arrangements

It is ensured that a major supplier will make publicly available either its interconnection agreements or a reference interconnection offer.

2.5 Interconnection: dispute settlement

A service supplier requesting interconnection with a major supplier will have recourse, either:

(a) at any time or

(b) after a reasonable period of time which has been made publicly known to an independent domestic body, which may be a regulatory authority as referred to in paragraph 5 below, to resolve disputes regarding appropriate terms, conditions and rates for interconnection within a reasonable period of time, to the extent that these have not been established previously. TN/S/O/IDN Page 49

3. Universal service

Any Member has the right to define the kind of universal service obligation it wishes to maintain. Such obligations will not be regarded as anti-competitive per se, provided they are administered in a transparent, non-discriminatory and competitively neutral manner and are not more burdensome than necessary for the kind of universal service defined by the Member.

4. Public availability of licensing criteria

Where a licence is required, the following will be made publicly available:

(a) all the licensing criteria and the period of time normally required to reach a decision concerning an application for a licence and

(b) the terms and conditions of individual licences.

The reasons for the denial of a licence will be made known to the applicant upon request.

5. Regulatory Authority

The regulatory Authority is not accountable to, any supplier of basic telecommunications services. The decisions of and the procedures used by regulators shall be impartial with respect to all market participants.

6. Allocation and use of scarce resources

Any procedures for the allocation and use of scarce resources, including frequencies, numbers and rights of way, will be carried out in an objective, timely and transparent manner. The current state of allocated frequency bands will be made publicly available, but detailed identification of frequencies allocated for specific government uses is not required.

______INDONESIA – LIST OF ARTICLE II (MFN) EXEMPTIONS TN/S/O/ID N Description of measure Page 50 Countries to which the Conditions creating the need for Sector or Subsector indicating its inconsistency Intended duration measure applies the exemption with Article II Movement of Low level occupations are Nationals of Malaysia, Indefinite Development of the region is being Personnel (semi- reserved for Indonesian citizens. Singapore, Brunei Darussalam, undertaken and for the confirmation skilled workers) Based on Government Policy, Papua New Guinea and of this programme, it is decided to limited exemptions may be Australia have been granted grant limited access to low level granted to citizens of certain limited access to low level occupations to citizens at a limited countries. occupations number of countries

3. CONSTRUCTION SERVICES Construction Services Measures relating to preferential Nationals of Brunei These measures shall be The implementation of a (government funded shortlisting in international Darussalam, Malaysia, The maintained as long as the preferential shortlisting scheme for projects) competitive bidding Philippines, Singapore and treaties of Asean remain in Asean contractors enhances the Thailand have been granted force advancement of civil works, special treatment industrial construction and the economic development of the Asean region Description of measure Countries to which the Conditions creating the need for Sector or Subsector indicating its inconsistency Intended duration measure applies the exemption with Article II 7. FINANCIAL TN/S/O/ID SERVICES N Page 51 Banking Services Measures relating to a All countries which adopt Suspended until the end of To guarantee equal treatment to joint-venture bank of national and reciprocal policies regarding the period of 60 days Indonesian nationals wishing to foreign origin under which entry Indonesian banks. beginning on 1 November establish and operate banks abroad. of a foreign bank in Indonesia is 1997 as stipulated in the allowed on a reciprocity basis Second Decision on (pursuant to Articles 14(3) of the Financial Services adopted Ministry of Finance Decrees No. by the Council for Trade in 220/KMK.017/1993 dated Services on 21 July 1995. 26 February 1993).

With respect to joint-venture banks, licenses can only be granted to foreign banks of countries which adopt reciprocal policies regarding Indonesian banks.

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