Abstract

The policy of protectionism has been adopted by a number of countries including Indonesia with the aim of protecting and improving the quality of domestic products. One form of the protectionism policy is through the Local Content Requirement which is realized by the Domestic Component Level (TKDN) policy. This policy affects the implementation of international selection process process (popularly known as ‘tenders’) which are a special form of government procurement of goods/services. This procurement is guaranteed by regulations due to the involvement of foreign parties in the selection process which can determine the outcome of the procurement. This research departs from the problem of international trade protectionism policies and the influence of TKDN policies in the regulations of the government procurement of goods/services which governs the international selection process. The research method used is normative juridical along with non-interactive qualitative. The results of the research conclude that the protectionism policy adopted by Indonesia encourages TKDN obligations in the procurement of government goods/services as one of the considerations to become one of the determining factors in the passage of international selection. This policy creates space for the use of domestic products to be applied in the process of government procurement of goods/services. Nonetheless, the TKDN policy on the one hand impedes the smooth running of the international selection process by limiting potential foreign participants in the international procurement mechanism. In addition, this research also concludes that in practice through cases there are conflicts with obligations regarding TKDN which are not fully considered in government goods/services procurement activities.

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