New Shipping Law Regulations: Key Highlights of Changes Introduced by Law No. 66 of 2024

Indonesian recently passed the third amendment to Law No. 17 of 2008 on Shipping on 28 October 2024 through Law No. 66 of 2024 on Third Amendment to Shipping Law (herein referred to as “Shipping Law”). The amendment to Indonesia’s Shipping Law through Law No. 66 of 2024 reflects the government’s approach to strengthening the maritime sector by addressing several issues, such as Pioneer Shipping development, joint venture and vessel ownership requirements, cabotage enforcement, and the expanded authority of the Maritime Court. These revisions aim to improve accessibility and increase investment within the shipping industry.

In this article, we provide the key highlights introduced by the third amendment of Shipping Law, regarding: (i) Reaffirming Pioneer Shipping Development; (ii) New Joint-Venture and Vessel-Ownership Requirements; (iii) Reinforcement of Cabotage Principle; (iv) New Delegated Authorities to the Maritime Court.

Reaffirming Pioneer Shipping Development

The Government intends to improve and provide better access to shipping services for passengers and/or goods in regions that do not have easy access to these services, which are referred as “Pioneer Shipping” under this amendment. Pioneer Shipping can be performed through (i) the assignment to state-owned national sea transportation companies, or (ii) procurement involving national maritime transport companies, whereby such assignment and procurement are by the central or a regional government. To accelerate this program, the central and regional governments shall provide facilities and infrastructure (funded by the state or regional government revenue/budget) to support the implementation of Pioneer Shipping (Articles 24 and 26B of Shipping Law). The form of support would include the provision of compensation to the national maritime transport companies providing the pioneer shipping services and covering all the associated costs related to the services.

New Joint-Venture and Vessel-Ownership Requirements
A shipping company applying for a Business License for Sea Transport is required to own an Indonesian-flagged ship with a minimum size of 175 GT (Gross Tonnage). Furthermore, the amendment raises the minimum vessel size requirement for joint ventures involving foreign and local entities. Previously, joint ventures were required to own, at least, 1 (one) Indonesian flagged vessel with a capacity of 5,000 Gross Tonnage (GT). Under the new law, this threshold is increased to 50,000 GT per vessel (Article 29 of Shipping Law). This adjustment aims to attract larger-scale foreign investments and improve the shipping sector’s capacity. However, existing joint ventures, particularly those in industries such as mining, will have a 1 (one) year grace period to comply with these new provisions, meaning all Shipping Companies will be required to comply with these requirements by 28 October 2025 (Article 347 of Shipping Law).

Reinforcement of the Cabotage Principle

The law further emphasizes Indonesia’s cabotage principle, which mandates domestic shipping operations to use Indonesian-flagged vessels owned by Indonesian companies. Stricter penalties are imposed for violations as the maximum imprisonment is increased from 5 to 11 years (Article 284 of Shipping Law).

New Delegated Authorities to the Maritime Court

A Maritime Court is defined as a special court consisting of a panel of experts who reports to the a Ministry of Maritime Affairs, authorized to conduct follow-up examinations of shipping accidents (Article 1 paragraph 56 of Shipping Law). With the implementation of the new amendment, the Maritime Court is now given the authority to conduct follow-up examinations of ship accidents involving Indonesian-flagged vessels in or outside Indonesian waters, and those involving foreign vessels in Indonesian waters (Article 251A of Shipping Law).

In addition to their previous right to impose Administrative Sanctions including warnings or revocation of Seafarer’s Certificate of Expertise on Captains and/or Officers for errors or negligence in vessel’s operations that cause accidents, they are also permitted to (i) issue warnings letters, and (ii) freeze or revoke business licenses of shipping companies (Article 253 of Shipping Law).

Concluding Remarks

Law No. 66 of 2024 introduces key updates to enhance Indonesia’s shipping sector by improving domestic accessibility, attracting investments, and reinforcing regulatory compliance. The reaffirmation of Pioneer Shipping, stricter vessel ownership requirements, and expanded Maritime Court authority reflect the government’s commitment to strengthening maritime infrastructure and safety. These changes aim to provide an efficient shipping industry while supporting Indonesia’s long-term economic growth through the shipping industry.


The article above was prepared by Audria Putri (Senior Associate), Mia Sari (Senior Associate), and M. Irfan Yusuf (Associate).

Disclaimer: The information herein is of general nature and should not be treated as legal advice, nor shall it be relied upon by any party for any circumstance. Specific legal advice should be sought by interested parties to address their particular circumstances.