Legal Insights

Regulatory Shifts in Indonesia’s Natural Resources Export Proceeds Regime: Current Rules and Outlook

Companies in Indonesia that conduct export activities in certain sectors are required to place their foreign exchange export proceeds (Devisa Hasil Ekspor or “DHE”) within the Indonesian financial system for a specified period. Under the Government’s current policy direction, DHE from natural resources (“DHE SDA”) are projected to be maintained exclusively with accounts from HIMBARA (state-owned) banks, which would limit the role of private banks and foreign bank branches in managing DHE SDA accounts. This obligation still applies to exporters with an export value of at least USD 250.000 (two hundred and fifty thousand United States dollars) or its equivalent.  

At present, the Indonesian Government is in the process of revising the framework governing DHE SDA. Once enacted, the new regulation will amend the existing regime under Government Regulation No. 8 of 2025 and Bank Indonesia Regulation No. 3 of 2025. While the new regulation is still in the process of being enacted, the current regulatory framework remains applicable.  

The key provisions under the existing regime are outlined as follows: 

Sectors Subject to the Requirement

The special obligation to place DHE in a designated account applies only to DHE SDA. The sectors which are required to implement these provisions consist of: 

1. Mining sector. 

2. Plantation sector. 

3. Forestry sector. 

4. Fisheries sector. 

Deposit Amount and Placement Period

DHE SDA must be deposited 100% (one hundred percent) with the Indonesia Eximbank (“LPEI”) and/or a designated Bank for a minimum period of 12 (twelve) months. As an exception, exporters in the oil and gas mining sector are only required to place a minimum of 30% (thirty percent) of their DHE SDA for at least 3 (three) months. 

Utilization of the DHE SDA in the Designated Account  

The DHE SDA placed in a Special Account may be utilized by the exporter for specific purposes permitted under the prevailing regulations. These include the payment of export duties and other export-related levies, loan repayments, import payments, distribution of profits or dividends, as well as other investment-related needs in accordance with the Investment Law. 

In addition, DHE SDA funds in the Special Account may be used for certain transactions, namely:  

1. Conversion into Rupiah through the same bank in accordance with Bank Indonesia regulations. 

2. Payment of tax obligations, non-tax state revenues, and other government obligations in foreign currency as permitted by law. 

3. Payment of dividends in foreign currency. 

4. Payment for the procurement of goods and services in foreign currency, particularly for raw materials, auxiliary materials, or capital goods that are unavailable, partially available, or do not meet required specifications domestically. 

5. Repayment of loans obtained for the procurement of capital goods in foreign currency. 

Exporter Obligations  

Upon depositing DHE SDA into the designated account, exporters are required to submit complete, accurate, and timely information regarding the deposit to the relevant LPEI and/or Bank. In addition, exporters must provide supporting documents evidencing the use of DHE SDA in accordance with the permitted purposes, along with a signed statement confirming that the funds have been utilized as intended. 

Transfer of Funds to the Designated Account  

Funds transferred to the designated account at the Bank may only originate from: 

1. The DHE SDA belonging to the same Exporter. 

2. Funds from the disbursement of banking instruments and/or interest payments on banking instruments sourced from the designated DHE SDA account belonging to the same Exporter. 

3. Funds originating from another DHE SDA account belonging to the same Exporter, whether at the same Bank, at another Bank, or at LPEI. 

4. Funds from principal repayments and/or interest payments or equivalent, from instruments placed with Bank Indonesia, whose funds originate from the Special DHE SDA Account belonging to the same SDA Exporter. 

5. Deposits for placement obligations. 

6. Other sources determined by Bank Indonesia. 

Transfers into a designated DHE SDA account held at LPEI follow the same permitted sources as listed above, with the exception of point (2). 

Maximum Rupiah Conversion Cap 

DHE SDA funds (excluding those from the oil and gas mining sector) placed in the designated account may be converted into Rupiah through cash and forward transactions conducted at the same Bank. The total amount converted into Rupiah may not exceed the nominal value of DHE SDA placed in the designated account, meaning that conversion into Rupiah is capped at 100% (one hundred percent) of the deposited amount. 

Consequences of Non-Compliance  

If an exporter fails to fulfil the legal obligations to insert and place DHE SDA as mandated by the applicable regulations, the exporter shall be subject to administrative sanctions in the form of suspension of export services. 

While the above provisions reflect the requirements currently in force, this framework will soon be subject to change. In addition to the requirement that DHE SDA accounts be maintained exclusively with HIMBARA Banks, the Government’s planned amendments are also anticipated to introduce, as reported by CNBC Indonesia, the following adjustments: 

• Lower Rupiah conversion cap: The maximum allowable conversion of DHE from foreign currency into Rupiah is expected to be reduced from 100% (one hundred percent) to 50% (fifty percent). 

• Broader permitted use of foreign exchange: The use of foreign exchange is expected to be expanded to cover certain working capital requirements. 

Accordingly, businesses are advised to closely monitor the issuance of the new regulation and assess its potential impact on their existing compliance practices, banking arrangements, and foreign exchange management strategies once the revised rules come into effect.