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The revision of the Decree of the President No. 54/2010 on Government Procurement will be finalized
11 April 2012

 

In the latest draft of the revised Decree of the President No. 54/2010 (Decree No. 54/2010) on Government Procurement, the government creates preference for domestic products and domestic providers in the government procurement of goods and services. The Director of the General Procurement Policy of the Institution of the Policy of Government Procurement of Goods/Services, Setya Budi Arijanta, mentioned, "the total maximum price preference is 15%, for national construction work, the preference is 7,5% above the lowest offer from foreign contractors. Only procurement with the value above Rp 5 billion will get the preference."

If this draft is finalized, this means that domestic providers of goods and services will obtain preference to foreign providers of goods or services even though the price offered by the foreign contractors are lower than the local contractors.

Additionally, Mr. Setya mentioned that local content requirement might be included in the procurement package even if the procurement is won by the foreign contractor.

The draft of the revised Decree No. 54/2010 is currently at the Secretary of State to be adopted by the President. The revision will not be applied retrospectively for the currently ongoing procurements.