The government of Indonesia is taking steps to strengthen the local economy by considering a new legal requirement for game publishers. This requirement would mandate them to establish limited liability companies in Indonesia in order to continue operating in the region.
Semuel Abrijani Pangerapan, the director-general for informatics apps at the Communication and Information Technology Ministry, emphasized the importance of this legal change. He stated, “If the publishers do not have a legal entity here, the games on that platform will be blocked. We want to build the digital economy; we don’t want to be just spectators. Let’s build it together.”
This move would apply to both local and foreign entities operating in Indonesia, with non-compliant publishers facing the threat of having their games blocked.
Enhancing the Digital Economy
The legal change in Indonesia will come in the form of a revised law with new rules and classifications, replacing the current regulations in place since 2016. According to Jakarta Globe, the purpose of the regulation is to enhance the “digital economy” of Indonesia, with gaming representing a significant potential revenue stream.
The Indonesian government aims to complete this maneuver promptly and introduce a new rating agency along with the revised regulations. Meanwhile, at PGC London last month, there were hints about an update to PEGI ratings in the UK, including changes to categorizations of language content.
The proposed requirements for publishers in Indonesia bear some similarity to China’s system of operations, where game developers are required to work with local publishers for approval of game launches. Given the stringent game license approval process in China, working with a local publisher becomes a necessity.
However, it remains to be seen if game makers worldwide will establish limited companies in Indonesia to reach its audience. For example, one of the largest publishers in China is Tencent, which recently began incorporating AI technology into its operations.
