Expatriates Could Be SOE Directors, Is It In The New Law?

JAKARTA - The placement of expatriates or foreign nationals (foreigners) into leaders in State-Owned Enterprises (BUMN) has attracted public attention, after President Prabowo Subianto previously revealed that he had changed the rules related to this matter.

President Prabowo Subianto revealed that the rules that previously required SOE leaders to be Indonesian citizens (WNI) had been changed.

Now, expatriates can also lead state-owned companies.

"I have changed the rules. Now expatriate, non-Indonesian can lead our SOEs. So I am very excited," Prabowo said in a dialogue with Forbes Media Chairman Steve Forbes, at the Forbes Global CEO event, Jakarta, quoted Thursday, October 16.

Separately, Danantara Indonesia CEO Rosan Roeslani said PT Garuda Indonesia (Persero) Tbk was an early example of implementing the policy. Currently, he said, the company is indeed carrying out a massive transformation.

In the Garuda Indonesia EGMS which was held on Wednesday, October 15, shareholders appointed two foreign nationals (WNA) as directors of the airline company Garuda Indonesia.

They are former Green Africa Airways boss Neil Raymond Mills, appointed Director of Garuda Indonesia Transformation, and Singapore Airlines official Balagopal Kunduvara, appointed as Director of Finance and Risk Management of Garuda Indonesia.

"If we look at the example of Garuda, this is the first to have a 25-year career at Singapore Airlines. The second is that it has been a very, very long career at Iberia Airlines, in three companies or four other airlines. So that's what we are for the Chief of Transformation because a very significant transformation is needed from Garuda," he said when met in the South Jakarta area, Thursday, October 16.

Rosan said management has a very important role in managing state-owned companies.

Therefore, he said, the government made changes through the Draft Law (RUU) on the Fourth Amendment to Law Number 19 of 2003 concerning State-Owned Enterprises (BUMN).

Furthermore, Rosan explained that through this change, the government opened up opportunities for foreign expatriates or foreigners to lead state-owned companies.

"We see management as having a very, very important role. And therefore because the revision of the law has also been opened, we can put the expat at the management level and with a very strong background," he said.

According to VOI's investigation, Law Number 16 of 2025 concerning the Fourth Amendment to Law Number 19 of 2003 concerning State-Owned Enterprises (BUMN) does not contain provisions that allow expatriates or foreign nationals (WNA) to occupy management positions in SOEs.

Article 15A paragraph (1) of the law explicitly states that prospective members of the board of directors must be Indonesian citizens, accompanied by a number of other conditions such as physical and spiritual health, as well as having high integrity and dedication to advancing state companies.

Berikut bunyi pasal 15A ayat (1), untuk dapat diangkat menjadi anggota Direksi Persero, calon anggota direksi Persero harus memenuhi beberapa persyaratan.

The following is article 15A paragraph (1), to be appointed as a member of the Persero Board of Directors, prospective members of the Persero board of directors must meet several requirements.

a. Indonesian citizens;

b. physically and mentally healthy;

c. have no family relationship, either inbreeding or arbitrary in the lineage straight and/or side by side, up to the second degree with the Board of Directors of Persero and the Board of Commissioners;

d. have expertise and experience in managing the Company or the company for a minimum of 5 (five) years;

e. have integrity, leadership, experience, honesty, good behavior, and high dedication to advance and

developing Persero;

f. can carry out the task in full time; and

g. other requirements based on the provisions of laws and regulations regarding the company are limited.

Article 15A paragraph (2) explains that apart from the conditions referred to in paragraph (1), to be appointed as a member of the Persero Board of Directors, individuals who are capable of legal acts, except within 5 (five) years before their appointment have been:

a. declared bankrupt

b. Being a member of the Board of Directors, Board of Commissioners, or Supervisory Board based on a court decision with legal force remains stated as the cause of a Persero or Perum being declared bankrupt; or

c. convicted of committing a crime that harms state finances and / or related to the financial sector, and / or other criminal acts with a minimum legal threat of 5 (five) years.