In August 2024, the Indonesian Government issued New Regulations*, updating regulations on business licensing, ease of doing business, and investment incentives for businesses in the Capital City of Nusantara (IKN). The objective is to boost investment and accelerate IKN’s development as a key national project.

The New Regulations outline several key updates, including relating to land rights, environmental approvals, investment incentives, ease of doing business, and employment of expatriates.

Under the New Regulations, the Government simplifies land rights issuance by reducing the process to a single stage. Land rights can initially be granted for up to 95 years, and extended for a maximum of another 95 years, depending on the type of land rights. The New Regulations also states that obtaining environmental approval for projects will depend on either an environmental feasibility decision or a commitment to oversight, based on business license requirements.**

To support investment and ease of doing business in IKN, the Government will provide fiscal and non-fiscal incentives, including tax and customs benefits, land provision, housing support, and support with infrastructure development. The New Regulations require businesses hiring expatriate workers to appoint and train local workers as companions, and ensure the repatriation of foreign workers when their contracts end.

*Government Regulation No. 29 of 2024 regarding the Amendment to Government Regulation No. 12 of 2023 regarding the Issuance of Business Licenses, Ease of Doing Business, and Investment Facilities for Business Actors within IKN.

**Business license environmental requirements include Environmental Impact Analysis (AMDAL), Environmental Management and Monitoring Efforts (UKL-UPL), and Statement of Environmental Management and Monitoring Capability (SPPL).