Guidelines for the Implementation of Beneficial Ownership for the Private Sector (ID0165)

Project Overview

The commitment on the Guidelines for the Implementation of Beneficial Ownership aims to strengthen implementation through practical, collaboratively developed guidelines for business actors. This initiative promotes recommendations to refine Presidential Regulation No. 13 of 2018 and enhance transparency, accountability, and private-sector compliance, in support of the Open Government Indonesia (OGI) agenda and corruption prevention.

Targeted Issues

The main issue to be addressed is the suboptimal implementation and compliance of the private sector in applying the principles of Beneficial Ownership (BO). This condition results in: Limited transparency of corporate ownership and control; A high risk of misuse of corporate entities for corruption, money laundering, and the financing of other criminal activities; and Limited contribution of the private sector to the open government agenda and corruption prevention efforts

The implementation of Beneficial Ownership (BO) in the private sector continues to face several challenges, including the absence of comprehensive, easily understandable implementation guidelines and a low level of understanding and awareness among business actors of the obligations and benefits of BO reporting. In addition, the dissemination of regulations and the provision of technical assistance require further strengthening. Although the legal framework is already in place, improvements and alignment in implementation are still necessary to ensure that BO implementation is carried out more consistently and effectively

Proposed Solution

The solutions proposed by KAKI include: Development of Guidelines for the Implementation of Beneficial Ownership for the private sector; Submission of inputs/policy papers from civil society partner organizations (KAKI) to the Ministry of Law (Directorate General of Legal Administration/AHU), prepared through consultations with business associations and companies; Dissemination and socialization of the guidelines to business actors; and Strengthening collaboration among government, civil society, and the private sector in the implementation of Beneficial Ownership. These solutions are intended to ensure that Beneficial Ownership regulations are not merely normative, but can be operationally implemented and deliver tangible benefits directly to business actors.

Relevance to the 5 Strategic Issues of OGI

The proposed solution has a strong linkage to the four strategic issues of Open Government Indonesia (OGI). First, from an anti-corruption, the implementation of Beneficial Ownership plays a critical role in preventing the concealment of ultimate beneficial owners, which is often exploited for corruption and financial crimes. Second, in terms of transparency and access to information, the development of the Guidelines for the Implementation of Beneficial Ownership promotes openness regarding corporate ownership and control structures. Third, from an accountability perspective, these guidelines strengthen corporate responsibility to disclose ownership information that is accurate, reliable, and accountable. Fourth, this solution is also aligned with public participation, as reflected in the involvement of civil society organizations— particularly KAKI—in the guideline development process, which represents a co-creation practice within the Open Government Indonesia framework.

Relevance to the Government's Priority Agenda

The proposed solution aligns with the National Strategy for Corruption Prevention (Stranas PK), particularly in preventing corruption in the private sector, and supports the National Medium-Term Development Plan (RPJMN) and the legal reform agenda by strengthening governance and legal certainty. In addition, this solution contributes to the Anti–Money Laundering and Counter–Terrorism Financing (AML–CTF/APU-PPT) agenda by enhancing transparency of corporate ownership, and reinforces Indonesia’s international commitments, including compliance with Financial Action Task Force (FATF) standards and the principles of openness under the Open Government Partnership (OGP)

Expected Outcomes

The targeted outcome of this commitment is the development and dissemination of the Guidelines for the Implementation of Beneficial Ownership for the private sector, aimed at increasing business actor engagement and compliance in Beneficial Ownership reporting, as well as strengthening transparency and corporate-based corruption prevention. In addition, this commitment promotes policy recommendations from the private sector as inputs for the amendment of Presidential Regulation No. 13 of 2018, to ensure that Beneficial Ownership regulations become more practical and proportionate without undermining the objectives of transparency and accountability

Commitment Plan

Results Indicators | Output | Timeline

A Guideline for the Implementation of Beneficial Ownership regulations for the private sector, based on appropriately targeted and inclusive Beneficial Ownership (BO) regulations. | 1. Completion of a study and policy paper containing private sector recommendations to support the revision of Presidential Regulation No. 13 of 2018 on Beneficial Ownership. 2. Submission of policy inputs to the Ministry of Law as part of the process to refine Beneficial Ownership regulations. | Estimated output end of year 1 (M-12)
1. Development and finalization of the Guidelines for the Implementation of Beneficial Ownership for the Private Sector through a participatory process led by KAKI. 2. Organization of the socialization and dissemination of the guidelines to business actors. | Estimated output end of year 2 (M-24)