INDONESIA Trends and Developments Contributed by: Enny Purnomo Widhya, Nugrahani Astiyanti and I Gusti Ngurah Oka Anantajaya, Mochtar Karuwin Komar
Mochtar Karuwin Komar 11th Floor WTC 1 Kav. 29-31 Jl. Jend. Sudirman Jakarta 12920 Indonesia
Tel: +62 21 571 1130 Fax: + 62 21 571 1162 Email: mail@mkklaw.net Web: www.mkklaw.net
Introduction Indonesia is the largest archipelago country in the world and the largest in terms of size and population in South-East Asia. It has more than 17,000 islands, making aviation not merely just a means of transport but essential infrastructure to carry out movement of people and goods within the country. In addition, with a population of 284 million, Indonesia has the larg - est aviation market for passengers and cargo, and the largest aviation industry in South-East Asia. It is considered one of the most important aviation mar - kets in Asia, with several large airlines including its national air carrier PT Garuda Indonesia (Persero) Tbk (Garuda Indonesia) and major privately owned airlines such as Lion Group airlines (PT Lion Mentari (Lion Air), PT Batik Air Indonesia (Batik Air), PT Super Air Jet (Super Air Jet) and PT Wings Abadi (Wings Air)). In terms of aircraft ownership by airlines, based on the Civil Aircraft Register of 2025, most aircraft operated by Indonesian airlines are owned by international air - craft lessors, thus reflecting the important role of air - craft lessors in the Indonesian aviation industry. Aviation in Indonesia is a regulated industry under the auspices of the Directorate General of Civil Avia - tion of the Ministry of Transportation of the Republic of Indonesia (DGCA). In the context of the Aviation Finance and Leasing Industry, the following are the main underlying regulations: • Law No 1 of 2009 concerning Aviation (the “Law No 1 of 2009”) as amended by Law No 6 of 2023 concerning the Stipulation of Government Regu - lation In Lieu of Law No 2 of 2022 concerning
Job Creation as Law (the ”Omnibus Law”, which together with Law No 1 of 2009 is referred to as the “Aviation Law”); • Government Regulation No 32 of 2021 concern - ing the Management of Aviation Activities (the “GR 32/2021”); • Government Regulation No 28 of 2025 concerning Implementation of Risk-Based Licensing (the “GR 28/2025”); • Ministry of Transportation (MOT) Regulation No 52 of 2018 concerning Aircraft Registration (the “MOTR 52/2018”) as amended by MOT Regula - tion No 26 of 2021 concerning the Amendment to MOTR 52/2018 (the ”Aircraft Registration Regula - tion”); and • The Convention on International Interests in Mobile Equipment (the “Convention”) and the Protocol to the Convention on International Interests in Mobile Equipment on Matters Specific to Aircraft Equip - ment (the ”Protocol” and, together with the Con - vention, the “Cape Town Agreements”) – by virtue of Presidential Regulation No 8 of 2007 dated 20 February 2007 (the ”Presidential Regulation”), the Cape Town Agreements have been duly ratified by the Republic of Indonesia. Aviation Finance and Leasing Transactions Structure in Indonesia Aircraft and engines in Indonesia are mostly operated with leasing schemes by Indonesian airlines and the following are the most common lease and financing structures adopted by Indonesian airlines: • Operating Lease;
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