Indonesia Foreign Investment Review – Currency Controls

Legal Updates
Indonesia Foreign Investment Review – Currency Controls
11 March 2020

By Darrell R Johnson and Greita Anggraeni

With regard to currency controls in Indonesia, the Indonesian rupiah cannot be freely traded outside Indonesia\'s territory. Only an amount of less than 100 million rupiah can be freely taken physically out of Indonesia at any one time.

BI Regulation No. 18/19/PBI/2016 stipulates that Indonesian commercial banks are restricted from carrying out overseas transfers of rupiah, which must first be converted into a foreign currency. Such transfers are controlled by Bank Indonesia (BI), Indonesia\'s central bank.

BI Regulation No. 18/10/PBI/2016 regarding Monitoring of Foreign Exchange Activities of Banks and Customers regulates foreign exchange flows. If the amount transferred overseas exceeds BI\'s thresholds, supporting documents must be provided by the customer as the basis for the transaction. The transfer of foreign currencies from Indonesia in the amount of (i) more than 10 billion rupiah or its equivalent requires the sender to provide information regarding the identity of both the sender and the recipient, as well as the purpose of such transfer, and (ii) more than such amount requires the sender to provide the bank with supporting documents for the basis of the transfer.

BI Regulation No. 18/18/PBI/2016 regarding Foreign Currency Transactions against Rupiah between Banks and Domestic Parties provides that Indonesian nationals, legal entities and residents that purchase foreign currency in excess of US$25,000 or its equivalent per month must provide information on the underlying transaction that meets the requirements of the bank.

The underlying transaction must relate to one or more of the following activities:

  • domestic and overseas trading of goods and services;
  • investment in the form of direct investment, portfolio investment, loan, capital and other investment, domestic and overseas; and/or
  • extension of credit or financing by a bank in foreign currency or in rupiah for trading and investment activities, or both.

Reproduced with permission of Law Business Research Ltd. This article was first published in Lexology Getting the Deal Through - Foreign Investment Review 2020 (Published: February 2020). For further information, please visit

This publication is intended for informational purposes only and does not constitute legal advice. Any reliance on the material contained herein is at the user\'s own risk. You should contact a lawyer in your jurisdiction if you require legal advice. All SSEK publications are copyrighted and may not be reproduced without the express written consent of SSEK.

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