The Indonesian House of Representatives (DPR RI) is set to pass the Bill on Indonesia’s International Financial Center (RUU PFII) into law during a plenary session scheduled for July 21, 2026. The legislation aims to attract investment from global conglomerates by establishing a specialized financial zone with distinct regulatory frameworks, including significant tax incentives and operational flexibility for foreign financial entities.
Legislative Approval and Framework
The bill’s progression to the plenary session follows a unanimous agreement among all eight political factions represented in Commission XI of the DPR RI. According to Commission XI Chairman Mukhamad Misbakhun, the decision to move to the second stage of deliberations was confirmed during a committee meeting on July 20, 2026. The final draft of the RUU PFII consists of 10 chapters and 73 articles, as stated by the Working Committee (Panja) Chairman, Mohamad Hekal.
Strategic Objectives for Global Finance
Finance Minister Purbaya Yudhi Sadewa, representing the government, stated that the PFII is designed to deepen Indonesia’s financial market, diversify financing sources, and strengthen the nation’s position within the global financial ecosystem. The government has accepted the results of the Panja deliberations, providing the necessary foundation for the upcoming plenary decision.
Did You Know? The RUU PFII includes a provision for a 0% income tax rate for financial service businesses operating within the zone, applicable for a duration of 50 years.
Regulatory Specializations and Governance
To enhance competitiveness, the bill introduces specific regulatory exemptions and specialized institutions. Minister Purbaya noted that the framework permits the use of foreign currency for business activities and establishes English as an operational language. Additional facilities for investors include provisions for golden visas, specialized immigration policies, employment regulations, and simplified licensing.
The legislation mandates the creation of dedicated governing and oversight bodies to manage the zone. These include the PFII Council, the PFII Management Agency, the PFII Financial Services Supervisory Agency, as well as specialized arbitration and court institutions.
Future Implementation
Frequently Asked Questions
What is the primary goal of the RUU PFII?
The bill aims to attract investment from global conglomerates, deepen Indonesia’s financial markets, and strengthen the country’s position in the global financial ecosystem.
What specific incentives are offered to investors in the PFII?
Investors in the PFII are eligible for several facilities, including a 0% income tax rate for 50 years for financial service businesses, golden visas, and special provisions for immigration and employment.
Which institutions will govern the PFII?
The legislation establishes several dedicated bodies, including the PFII Council, the PFII Management Agency, the PFII Financial Services Supervisory Agency, an arbitration board, and a specialized court.
How do you think these specialized regulatory zones will impact the broader domestic financial market in Indonesia?
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