International Banking & Finance – Indonesia – Yoshivan Immanuel

Sarvasūkṣma Attorneys at Law (Sarva) is an Indonesian law firm practising in both dispute and corporate/commercial practices. Our lawyers have worked with domestic and international clients for more than a decade, and are recognised by our clients as strategic partners with deep commercial instincts and a commitment to creatively anticipating their needs while delivering excellence.

Our Banking & Finance practice group, headed by Yoshivan Immanuel (Yoshivan), has consistently worked in banking & finance, as well as capital market transactions – advising various banks, financial services companies and fund companies in bilateral and syndicated lending, as well as both domestic and international bonds issuances. Yoshivan’s team has extensive experience representing lenders, arrangers and underwriters to draft and negotiate various transaction documents in debt finance and restructuring works. With that experience, Sarva has also been trusted to assist Indonesian companies in dealing with their banks and fund/asset management firms to strike a balance between the two sides in both legal and commercial matters.

Yoshivan obtained his Bachelor of Laws from University of Padjajaran. Meanwhile, he is a member of the Indonesian Advocates Association (Perhimpunan Advokat Indonesia) and is admitted to the bar in Indonesia. In addition, he is a member of the Indonesian Capital Market Legal Consultant Association (Himpunan Konsultan Hukum Pasar Modal) and is registered as a Capital Market Legal Consultant for the Indonesian Financial Services Authority (Otoritas Jasa Keuangan).

In 2022, Yoshivan was selected as one of ALB Indonesia’s Rising Stars for 2022, and was also listed as a notable lawyer in banking & finance by the Legal 500 (Legalese).

He regularly authors publications providing insight and legal updates on the relevant regulations issued in Indonesia, especially those related to banking and the capital markets.

In recent years, Yoshivan’s team has regularly assisted one of Asia’s largest brokerage firms in relation to its financing, either in conventional or structured financing. This extends beyond the preparation of financial documents, as the team has further advised on deal structure in the pre-transaction stage, combined with compliance matters during the post-transaction stage.

Moreover, the team has worked with some of Asia’s fund firms in dealing with its Indonesian clients on their financing requirements, as well as debt restructuring work.

Yoshivan predominantly works on cross-border financing transactions, which involve differing legal jurisdictions. This has gained him recognition from international banks, financial institutions and fund companies, as well as international law firms. His expansive know-how and familiarity on Indonesian issues vastly assists our clients in financing and bond transactions, as well as debt restructuring works involving Indonesian parties and assets. Collateralisation and enforcement have often been key to allocate financing to Indonesian parties with “onshore” assets.

Our clients are primarily banks, financial institutions, brokerage firms and fund companies; however, we also assist private and public companies in Indonesia in completing their corporate actions.

Some of the primary issues and complexities in banking & finance works include:

– Cross-border issues: many transactions that we handle are cross-border. Cross-border financing deals with various differing aspects between legal jurisdictions, such as language, legal system (e.g. common law vs civil law) and regulatory compliance – hence, engaging local experts in cross-border financing transactions is crucial;
– Risk management: financing transactions are exposed to various risks – financial/credit risk, market risk and, particularly, legal risk. One of the ways to mitigate legal risk is to conduct due diligence towards the borrowing parties. We help clients conduct due diligence in order to check on corporate information, licences/permits, material assets, as well as contracts and disputes of the borrowing parties;
– Extensive negotiation: working on financing transactions involves various parties with multiple interests. This is often a challenge, as this involves extensive negotiation, and counsel must find ways to accommodate each party’s concerns correctly. Utilising “standardised” financing documents tremendously assists in expediting the negotiation process among the parties; and
– Unconventional structure: a financing transaction can be structured in an unconventional way. This requires other related financing instruments, such as notes issuance documents (e.g. convertible note agreement or equity linked notes agreement, etc.), put/call option agreement, warrant agreement and derivate contracts. We possess wide-ranging experience and a collection of cases in point on structured financings to address any queries or issues by clients or counterparties.

Sarva was selected as ALB’s Indonesia Firms to Watch by Thomson Reuters consecutively in 2022 and 2023.

More recently, Sarva was selected as one the finalists for ALB Indonesia Law Awards 2024 in its Banking & Financial Services category – an event set to be held on the 24th of October, 2024. This is a testament to how much Yoshivan’s team is steadily growing, and recognises its combined ability to collaborate with the other leading names in the market.

Recent challenges in the economy, such as inflation and fluctuations of interest rates, have generally impacted business – particularly affecting investment and lending decisions. As a developing country, investment is crucial for Indonesia, as this fuels the region’s economic growth. Such challenges have in fact led to liquidity issues for a few companies repaying their existing loans to lenders.

Some of our cases in the past 12 months have concerned debt restructurings, highlighting our drive to seize opportunities and adapt to changing scenarios. In addition, we have paid special attention to local industries that remain consistently strong in Indonesia, such as food and beverage, as well as tourism industries, extending to advisory work for some local companies engaged in those industries.

FinTech continues to revolutionise the banking & finance markets, including those in Indonesia. FinTech has rapidly grown to become one of the factors driving financial inclusion. It now stands as a legitimate alternative to traditional financing, and is more accessible for those who live in remote areas or are difficult to reach by traditional financial institutions. In addition, FinTech promotes the development and innovation of technology, making it easier for customers to perform financial transactions – concurrently prompting traditional financial institutions to adopt new technologies to remain competitive.

Cross-border financing requires local experts to advise on local issues for the interests of transaction parties. To this end, our accumulated expertise in banking & finance gives us a notable advantage when working on an international level where Indonesian aspects are involved.

In financings with both onshore and offshore parties, we often bridge the onshore and offshore parties, settling language and culture gaps between them. Our experience working on a global scale further helps us to work seamlessly with law firms across various jurisdictions.

Indonesia is known as attractive for investment due to the following facts:

– Indonesia has abundant natural resources, which play an important role as the backbone of the economy;
– Indonesia is one of the world’s largest consumer markets;
– Indonesia is one of the leading manufacturing countries in the world; and
– Indonesia is developing its new capital city, i.e. Ibu Kota Nusantara (or IKN).

Furthermore, Indonesia is a promising market for both foreign and local investments. As per data from Ministry of Investment of the Republic of Indonesia, over 50% of total investment in the country derives from foreign investment (which is around USD 27,8 billion as of Q2, 2024).

To date, interest from foreign financers in Indonesian private businesses has been relatively strong. Financings provided have involved such varying sectors as: manufacturing, electricity & gas, mining & quarrying, as well as financial and insurance activities. According to Bank Indonesia’s data – issued in September 2024 – as of July 2024, the position of offshore loans to private business in Indonesia was recorded at USD 195,2 billion, which increases 0,1% (YOY). The purpose of offshore loans to private businesses is predominantly for working capital and investment.

In terms of financing amount, Singapore, followed by the US and China, are the top three originating countries providing financings to Indonesian private businesses.

To ensure a well-informed advisory scope for clients who are based in other jurisdictions or have operations overseas, we conduct periodical checks on regulation databases, and publish timely legal insights to alert clients of any changes or improvements relevant to the presiding regulations.

Our firm’s objective is to expand in the near future, implementing new team members and establishing additional practice groups to support the firm’s business going forward. In the long run, we plan future cooperation or alliances with international law firms to widen our relationships globally and establish a stronger position in the market.

After the issuance of Law No. 4 of 2023 of the Republic of Indonesia on Development & Strengthening of the Financial Sector – which was passed on the 12th of January 2023 to reform the sector – the Indonesian authority has continuously issued regulations, including those pertaining to the banking sector. Some of the more notable updates relate to obligations for lawyers / legal counsels: (i) to first register themselves with Bank Indonesia (Indonesia’s central bank) for providing services in money market and foreign exchange activities / transactions, and (ii) to be subject to bank secrecy requirements under the upcoming bank secrecy regulations.

We also reasonably anticipate updates on regulations by Indonesia’s authority to address live issues, such as: personal data protection, technology, AI, as well as green/sustainable development.