32 J.L. Pol'y & Globalization 1 (2014)

handle is hein.journals/jawpglob32 and id is 1 raw text is: 

ISSN 2224-3240 (Paper) ISSN 2224-3259 (Online)                                                         I
Vol.32, 2014                                                                                       U151

        An Analysis of the Authority in Licensing Approval(The

    Preliminary Approval) on the Activity of Foreign Investment

                 Isyc Junita Melo 1  Sudarsono 2   Bambang Winamo        Iwan Permadi 4
                                   E-mail of the corresponding author:
                                          isye.ijm 4gmail.com

Until now foreign investment is still one of the important factors to move and support the economics' growing.
In analyzing the important role of foreign investment, trying to be the target of foreign investment is the common
thing among many countries in this era, both the developed countries and the developing countries. Developing
countries try as they can to be the target of the foreign investment. In philosophy, the existence of foreign
investment is mainly needed which aims to support the development for the prosperity of the whole Indonesia
people. Foreign investment affects to economics' growing and the employment field. However, in fact this
foreign investment does not only give the positive effects but also some negative effects. There are some
problems which is related to the foreign investment. Those problems are related to the Licensing or the
preliminary approval for the foreign investors that will trust their financial capital in Indonesia. Its regulations
are confusing the investors. This confusion happens because the authorities of PMA permission are given to the
center government through BKPM, but the existence of region autonomy also affects that (PMA) the foreign
investment management is included to the obligation of region government. Thus, based on this regulation the
region government also can manage the regulation of foreign investment permission which has been explained in
region regulation that has been stated.
Keywords: Foreign Investment, Authority, the Central Government, Local Government.

The main role of the Nation is to build the nation goals as stated in every constitution or the related Constitution
of republic. The nation of Indonesia also agrees with the concept. The goals of The Nation of Indonesia has
been stated in the constitution of Republic 1945 as the Constitution principal of Indonesia Republic, both the
pre-amendment and post- amendment. Those goals tells about the strong motivation of the Indonesia people's
prosperity and also the willing to build the welfare state.
        This philosophy emphasizes the willing of Indonesia founders that the nation itself has to be active in
performing the Nation's prosperity. The republic of Indonesia is designed as the (welfare state), it means the
government has responsibilities to guarantee the standard of minimum prosperity for everyone.5 Those goals can
be achieved through some facilities, those facilities are the development institutions. It is true that the
development needs a lot of funds. It is absolutely difficult to build the goals of the nation founder with the fund
and source of the Government only. Thus, it is necessary to find another fund source. One of the source is the
investment. Investment can be used to get the fund source in nation's development.6
        The strategy of Indonesia government to use the existence of investment especially the foreign
investment is the right step. Therefore, by inviting the foreign investors it means that we have been trying to be
as good as the developed countries. The investors' fund, the skill trainings, and the investment management
especially the skill of foreign investor in managing the potential economy resource becomes the riil economics
give some advantages to our country. In other words, through the strategy regulation, Indonesia can be equal
with the other developed countries in using the potential of capital of the other countries.'
        The foreign investors that want to develop or build their business in Indonesia have to do the procedure
that is related to the permission regulation. Those regulations give advantages to the foreign investors. The latest
regulation on The Law of Investment gives easiness to the foreign investors to expand their businesses on
Indonesia. One of the examples is that there is no regulation that regulate the responsibility of the foreign

1lsye Junita Melo mahasiswa Program Doktor Ilmu Hukum Universitas Brawijaya Angkatan Tahun 2011-2012.
2 Sudarsono Promotor dan Guru Besar Ilmu Hukum Administrasi Negara Program Pascasarana Fakultas Hukum Universitas
Brawijaya Malang.
3 Bambang Winamo Ko-Promotor, Dosen Program Pascasarana Universitas Brawijaya Malang.
4 Iwan Permadi Ko-Promotor, Dosen Program Pascasarjana Universitas Brawijaya Malang.
5 An An Chandrawulan, Hukum Perusahaan Multinasional, Liberalisasi Hukum Perdagangan Internasional, dan Hukum
Penanaman Modal. (Bandung: ALUMNI, 2011), him, 15-16
6 Sentosa Sembiring. Hukum Investasi. Pembahasan Dilengkapi Dengan Undang-undang Nomor 25 Tahun 2007 Tentang
Penanaman Modal. (Bandung: Nuansa Aulia, 2010), hlm, 58-59.
SIbid, hlm. 57-58.

Journal of Law, Policy and Globalization


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