Overview

Fundamentally, Indonesia does not yet have a comprehensive and integrated regulatory framework that specifically governs Artificial Intelligence providers. The applicable regulations remain dispersed across various legal regimes, including electronic system administration, personal data protection, cybersecurity, and business licensing. In this context, companies that provide AI models, platforms, applications, Application Programming Interfaces, or AI services through electronic means may generally be classified as Private Scope Electronic System Operators (Penyelenggara Sistem Elektronik - “PSE”) and are therefore subject to the provisions of Law No. 11 of 2008 on Electronic Information and Transactions, as most recently amended by Law No. 1 of 2024 (collectively “Law 11/2008”), Government Regulation No. 71 of 2019 on Electronic Systems and Transactions Implementation (“Regulation 71/2019”), and Government Regulation No. 28 of 2025 on Risk-Based Business Licensing Administration (“Regulation 28/2025”). A significant development occurred with the enactment of Government Regulation No. 28 of 2025 on Risk-Based Business Licensing Administration (“Regulation 28/2025”), which formally recognizes artificial intelligence development as a distinct business activity through the introduction of a dedicated Indonesian Standard Industrial Classification (Klasifikasi Baku Lapangan Usaha Indonesia – “KBLI”). As a result, AI development is no longer viewed solely as an electronic system activity but is also subject to Indonesia’s risk-based business licensing framework.