Normative inconsistencies in Indonesian investment law: Implications for legal certainty and the investment climate

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Abstract

A conducive investment climate is essential for attracting both domestic and foreign investors. In Indonesia, legal certainty remains one of the most critical yet problematic elements, primarily due to normative inconsistencies across multiple layers of legislation. This article examines the impact of such inconsistencies on investment licensing procedures and legal certainty. The study employs a normative juridical method with statutory, conceptual, and comparative approaches. Findings reveal that overlapping regulations — particularly between the Investment Law, the Job Creation Law, and sectoral regulations — generate procedural uncertainty, excessive bureaucratic discretion, and high transaction costs for investors. Comparative analysis with Vietnam, Malaysia, Singapore, Thailand, the Philippines, South Korea, India, Brazil, and South Africa demonstrates that regulatory harmonization and centralized licensing authority are key to reducing legal risks and improving investor confidence. This article argues that Indonesia must urgently pursue regulatory harmonization, strengthen the Online Single Submission — Risk-Based Approach (OSS-RBA) system, and ensure consistency in the application of conflict-of-law principles to foster a reliable and competitive investment climate.

Keywords: Legal Certainty, Investment Law, Normative Inconsistency, OSS-RBA, Regulatory Harmonization

Authors’ individual contribution: Conceptualization — I.; Methodology — I.; Validation — Y.; Formal Analysis — I.; Investigation — Y.; Resources — Y.; Data Curation — Y.; Writing — Original Draft — I.; Writing — Review & Editing — I.; Supervision — I.

Declaration of conflicting interests: The Authors declare that there is no conflict of interest.

JEL Classification: K15, K20, K220

Received: 19.09.2025
Revised: 20.11.2025; 05.12.2025; 05.01.2026
Accepted: 19.01.2026
Published online: 22.01.2026

How to cite this paper: Iriansyah, & Yalid. (2026). Normative inconsistencies in Indonesian investment law: Implications for legal certainty and the investment climate. Corporate Law & Governance Review, 8(1), 88–99. https://doi.org/10.22495/clgrv8i1p7