The Indonesian House of Representatives (DPR RI) officially passed the Revised Bill on State-Owned Enterprises (SOEs) into law during a plenary session at the Parliament Complex in Senayan, Jakarta, Thursday, October 2. The approval was supported by all political party factions present. 

All members of the plenary session simultaneously approved the bill on SOEs into law. Earlier, Friday, September 29, Commission VI of DPR RI and the government had agreed on the bill on the Fourth Amendment to Law No. 19/2003 on SOEs. 

Substantively, 84 articles in the draft law have been amended. Among them, the government officially dissolved the Ministry of SOEs and replaced it with the SOE Regulatory Agency (BP BUMN) as the regulator of state-owned enterprises. 

Role and Function of the SOE Regulatory Agency 

Prior to the passing of the bill, Minister of Law Supratman Andi Agtas explained that BP BUMN will carry out specific tasks distinct from Danantara. 

“BP BUMN is a regulator, Danantara is an executor. So, there is no overlap,” Supratman said after the parliamentary meeting last weekend. 

According to Supratman, BP BUMN will focus on regulation, guidance, and oversight of state-owned enterprises. Meanwhile, Danantara will manage and carry out SOE investment operations. Thus, the dual function previously held by the ministry is now split to clarify authority. 

Another difference lies in shareholding composition. BP BUMN retains 1% of Series A Dwiwarna shares. These special shares carry veto rights on strategic policies, including holding the General Meeting of Shareholders (RUPS). Meanwhile, Danantara holds the majority with 99% of Series B shares. With this structure, Danantara plays a dominant role in business and investment management, while BP BUMN safeguards state interests through the strategic rights attached to Series A Dwiwarna. 

Supratman said the division of roles is expected to create more transparent and accountable governance. “With this division, we expect good governance to be realized. This will become a source of prosperity for the Indonesian people,” he added. 

Institutionally, the head of BP BUMN will be appointed directly by President Prabowo Subianto. For now, the position may be concurrently held until an official appointment is made. This means BP BUMN’s establishment awaits the formal enactment of the bill into law. 

As for the distribution of dividends between BP BUMN and Danantara, Supratman said the technicalities will be further regulated through a Presidential Regulation. This is deemed important to balance the oversight and management functions. 

This restructuring of SOE governance marks a shift in the management of state-owned enterprises. Previously, the Ministry of SOEs combined regulatory and operational roles. Now, these functions are separated to clarify responsibilities. 

With BP BUMN and Danantara, the government expects a more effective check-and-balance mechanism. BP BUMN will ensure strategic policies align with national interests, while Danantara will maximize financial and business performance of SOEs. 

This step underlines a shift in SOE governance under President Prabowo’s administration. The dual-institution model between regulator and operator is expected to improve the performance of SOEs and strengthen their contribution to the national economy. 

This article is published in partnership with Katadata 

Original article here