REPUBLIKA.CO.ID, JAKARTA - A new regulation restricts privately owned companies to be allowed to set up a maximum of 250 outlets. Indonesian Government rules the operations through The Decree of Minister of Trade No 07/MDAG/PER/02-2013 dated February 11, 2013. 

The regulation is applied to restaurant, bar and cafe. Those who already own 250 outlets have to adjust with the provisions within a period of five years since the regulation enacted.

The Head of Board of Trustee of the Indonesian Franchising and Licensing Society (Wali), Amir Karamoy, criticized the new regulation, complaining that it would give wider opportunities to foreign food and beverage companies instead of local ones.

Through this regulation, government regulates the partnership composition for food and beverage companies based on its investment. For those with investment less than or equal to 10 billion IDR, the minimum capital investment from other parties should be 40 percent, while the capital investment for investment value above 10 billion IDR must be at least 30 percent.

Karamoy believes that this pattern would give benefit to foreign franchises as they could develop more outlets by teaming up with local investment. He insisted that the equity must not be included in the Ministerial Decree No. 7/2013. "It should have been regulated in another regulation," he said on Thursday.

Local franchisors welcomed the regulation positively. Nurul Atik, an owner of Indonesian restaurant, Rocket Chicken, said the regulation which limited the outlets up to 250 could even up the business. She was not worried that foreign restaurants would imitate such rules to expand their markets or outlets.

"Foreign and local restaurants have different market segments as well as different standard. I don't think it becomes a problem," she said.

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