Proposed Competency Standardization in the Draft Bill on Regionally-Owned Enterprises

Indonesia’s House of Representatives (“ DPR ”) has provided several points to be incorporated into the deliberations of the Draft Bill (“ RUU ”) on Regionally-Owned Enterprises (“ BUMD ”). One of the key points is the standardization of management competencies within BUMD, covering candidates for the positions of board of directors, board of commissioners, and supervisory board members.

Chairman of Commission II of DPR RI, Rifqinizamy Karsayuda, stated that the current governance of BUMD is highly disorganized. Political interference has resulted in management positions being filled by individuals lacking the necessary competence.

“There has never been any competency standardization. It gives the impression that BUMDs have become a place for local election campaign teams of winning candidates, whose competencies are never upgraded,” said Rifqi.

In addition, the DPR supports granting the central government the authority to supervise and evaluate BUMDs. This authority would also include the power to suspend or dissolve BUMDs. “This is so that our BUMDs can truly become part of the backbone of the national economy at the regional level,” Rifqi added

RUU BUMD has been included in the 2025 Priority National Legislative Program (Prolegnas). The Ministry of Home Affairs (Kemendagri) has prepared the academic paper (NA) and draft RUU BUMD to be discussed jointly with DPR.

“We will discuss the timeline for the commencement of the deliberations during the next parliamentary session,” said Deputy Chairperson of the Legislative Body (Baleg) of the DPR RI, Ahmad Doli Kurnia, in an interview with Hukumonline.