ONE CITY, TWO AUTHORITIES: A STUDY OF JURISDICTIONAL COMPETENCE IN THE BATAM FREE TRADE ZONE
Keywords:
Free Trade Zone, Regional Authority, Batam, Licensing, MunicipalitiesAbstract
This study examines the historical dualism and legal vacuum in the governance of Batam, Indonesia, stemming from the overlapping authorities between the Batam Municipal Government (territorial autonomy) and the Batam Authority/BP Batam (functional economic autonomy). This prolonged legal uncertainty, originating from unfulfilled legislative mandates post-1999 regional autonomy laws, has significantly hindered the region's economic competitiveness and overall investment climate. Conducting a normative legal research methodology utilizing statute and conceptual approaches, this paper critically analyzes the institutional integration and the strict demarcation of authority between the two entities. The findings reveal that the structural deadlock was resolved through the ex-officio mechanism, institutionalized by Government Regulation (PP) No. 62/2019 and PP No. 4/2025, which designates the Mayor and Deputy Mayor as the Chairmanships of BP Batam. The Supreme Court validated this arrangement by classifying BP Batam as a Public Service Agency (BLU), circumventing standard dual-office prohibitions. Furthermore, the study demonstrates a fundamental paradigm shift in business licensing within the Free Trade Zone. Driven by risk-based licensing reforms (PP No. 25/2025 and PP No. 28/2025), BP Batam is now firmly established as the single licensing authority. Applying the principle of lex specialis derogat legi generali, this specific regulatory framework overrides the general regional licensing provisions (PP No. 6/2021), rendering the local government's licensing authority null and void within the free trade zone delineation. Ultimately, this research theorizes that Batam has successfully transitioned into a dual governance model. This model harmonizes territorial decentralization for public service delivery with functional autonomy for strategic economic zone management, proving that the existence of a special economic authority reconfigures, rather than eradicates, local government functions, thereby ensuring absolute legal certainty for domestic and foreign investors.
Downloads
References
Achmad, Amsakar, Wirman Syafri, Mansyur Achmad, and Rizki Amalia. “Implementation of Ex-Officio Policy on The Development of Batam Free Trade Zone and Free Port Area.” Journal of Governance 9, no. 4 (2024): (829-846. https://doi.org/10.31506/jog.v9i4.29678.
BatamNews. “Nyat Kadir: Walikota Ex-Officio Kepala BP Batam Sudah Tepat.” Batamnews, 2021. https://www.batamnews.co.id/berita-76550-nyat-kadir-wali-kota-ex-officio-kepala-bp-batam-sudah-tepat.html.
Brodjonegoro, Bambang, and Shinji Asanuma. “Regional Autonomy and Fiscal Decentralization in Democratic Indonesia.” Hitotsubashi Journal of Economics 41, no. 2 (2000): 111–22.
CNBC Indonesia. “Matahari Kembar Yang Bikin Jokowi Gemas Bubarkan BP Batam.” CNBC, 2018. https://www.cnbcindonesia.com/news/20181212172606-4-46097/matahari-kembar-yang-bikin-jokowi-gemas-bubarkan-bp-batam.
CNN Indonesia. “Terikat UU, Tak Gampang Bubarkan BP Batam.” CNN, 2018. https://www.cnnindonesia.com/ekonomi/20181213171739-92-353490/terikat-uu-tak-gampang-bubarkan-bp-batam.
Cornelia, P. “Tinjauan Yuridis Status Batam Sebagai Kawasan Perdagangan Bebas Beserta Hambatannya.” Universitas Indonesia, 2013.
Dalla, Alexander Yanuard, and Friska Natlia Hutabarat. “Tumpang Tindih Kewenangan Pengembangan Kawasan Ekonomi Khusus Batam.” Matra Pembaruan 2, no. 2 (2018): 139–48. https://doi.org/10.21787/mp.2.2.2018.139-148.
Detik Finance. “BP Batam Dibubarkan Agar Tak Ada Dualisme Kewenangan.” Detik.com, 2018. https://finance.detik.com/berita-ekonomi-bisnis/d-4340534/bp-batam-dibubarkan-agar-tak-ada-dualisme-kewenangan.
Grunsven, Leo van, and Francis E. Hutchinson. “The Evolution of the Electronics Industry on Batam Island (Riau Islands Province, Indonesia): An Evolutionary Trajectory Contributing to Regional Resilience?” GeoJournal 82, no. 3 (2017): 475–92. https://doi.org/10.1007/s10708-015-9692-9.
Hidayah, Ni’mah. “Pembentukan Free Trade Zone (FTZ) Di Indonesia: Studi Kasus Pembentukan FTZ Batam.” Universitas Indonesia, 2005.
Huda, Ni’matul. Otonomi Daerah: Dinamika Hubungan Pusat & Daerah Pasca Reformasi. Rajawali Pers, 2024.
Indra, Mexsasai, and Fadhillah Fauzan. “The Importance of Structuring Relationships Between Local Governments and Business Entities in the Perspective of State Administrative Law in Batam City, Riau Islands.” Jurnal IUS Kajian Hukum Dan Keadilan 11, no. 1 (2023): 126–39. https://doi.org/10.29303/ius.v11i1.1146.
Liputan 6. “Pengusaha Batam Mendukung RUU Perdagangan Bebas.” Liputan 6, September 26, 2002. https://www.liputan6.com/news/read/42106/pengusaha-batam-mendukung-ruu-perdagangan-bebas.
———. “RUU Kawasan Perdagangan Bebas Batam Diprotes.” Liputan 6, September 19, 2002. https://www.liputan6.com/news/read/41687/ruu-kawasan-perdagangan-bebas-batam-diprotes.
Negara, Siwage Dharma, and Francis E Hutchinson. “The Impact of Indonesia’s Decentralization Reforms Two Decades on Introduction.” Journal of Southeast Asian Economies 38, no. 3 (2021): 289–95. https://doi.org/10.1355/ae38-3a.
Ombudsman Republik Indonesia. “Ombudsman: Hentikan Rencana Pengangkatan Ex-Offico Kepala Batam.” Ombudsman, 2019. https://ombudsman.go.id/news/r/ombudsman-hentikan-rencana-pengangkatan-ex-offico-kepala-batam.
Peachey, Karen Joanne. “Where There Is Sugar, There Are Ants: Planning for People in the Development of Batam, Indonesia.” the University of British Columbia, 1998.
Pioner, Lany, Jun Matsunami, and Bakti Setiawan. “Institutional Dualism and Its Impact on Economic Development The Case of Dualism in Batam.” Journal of Applied Geospatial Information 3, no. 2 (2019).
Qamar, Nurul, and Farah Syah Rezah. Metode Penelitian Hukum: Doktrinal Dan Non-Doktrinal. Edited by Abd Kahar Muzakkir and Faisal Rahman. Makassar: Social Politic Genius (SIGn), 2020.
Respationo, Soerya, and Nar Yan Thapa. “Optimizing Regional Governance in Batam City Government- Business Entity Institutional Dualism.” SASI 30, no. 1 (2024): 87–99. https://doi.org/10.47268/sasi.v30i1.1869.
Smith, Shannon L D. “Developing Batam: Indonesia Political Economy Under the New Order.” the Australian National University, 1996.
Wiryawan, Bangkit A. “Addressing Innovation Competitiveness of Batam Free Trade Zone: What Went Wrong?” In International Conference on Social and Political Issues (ICSPI 2016), 104–14, 2018. https://doi.org/10.18502/kss.v3i10.2907.
Zaenuddin, Muhammad, Wahyudi Kumorotomo, Samsubar Saleh, and Agus H. Hadna. “Dualisme Kelembagaan Antara Pemerintah Kota Dan Badan Pengusahaan Batam Serta Dampaknya Terhadap Kinerja Perekonomian Di Kota Batam.” Journal of Applied Business Administration 1, no. 2 (2018): 219–31. https://doi.org/10.30871/jaba.v1i2.613.
