Provision on Airport-Service Activity Management Revised

The Minister of Transportation(“Minister”)has issued Regulation No. PM 187 of 2015 (“Amendment”), which amends Ministry Regulation No. PM 56 of 2015 on Airport Management Activities (“2015 Regulation”).Under the Amendment, business entities or business units that organize airports (“Airport Organizer”) now may enter into cooperation with other business entities in order to provide several types of airport services. To this end, the Amendment specifies the requirement and licensing procedure that have to be followed by business entities in order for them to become eligible for such cooperation.In addition, the Amendment also redefines three main provisions set out in the 2015 Regulation, namely: 1) the requirement to be appointed as an Airport Organizer; and 2) the requirement for businesses to secure a service certificate from the Minister.The 2015 Regulation is of relevance to business entities which are currently involved in, or which are intending to become involved in, airport management.Airport-Service CooperationTwo types of airport-management activities are set out under the 2015 Regulation, namely: a) airport-service activity; and b) supporting airport-service activity. [1] Airport-service activity [point (a)] is provided by an Airport Business Entity [2] (for commercial airports) or Airport Business Unit [3] (for non-commercial airports) (together referred to as “Airport Organizer”). Meanwhile, supporting airport-service [point (b)] is provided by Indonesian legal entities or individuals. [4] At present, the Amendment allows Airport Organizers to appoint State/Regionally Owned Enterprises (BUMN/BUMD), and Indonesian Limited Liability Companies or cooperatives (together referred to as “Business Entity”) to provide certain airport-service activities. [5] In order to enter into a cooperation contract with an Airport Organizer, a Business Entity must first secure an airport-service license (“License”) from the Minister. [6] However, before applying for such a License, a Business Entity must first satisfy the following criteria: [7]