The Indonesia PDP Law in the Transition Period: What Should We Do Now?

By Setyawati Fitrianggraeni, Reynalda Basya Ilyas, Casey Jovenia

Why the Transition Period Matters

Indonesia’s Personal Data Protection Law (Law No. 27 of 2022, or “PDP Law”), enacted in October 2022, provided a two-year transition period that ended in October 2024. This period allowed businesses from global enterprises to small startups to adapt to its comprehensive requirements for safeguarding personal data and respecting data subject rights.

With the transition now over, enforcement is ramping up. Non-compliance risks hefty penalties, including fines up to 2% of annual revenue, operational suspensions, or even criminal charges in extreme cases. However, compliance isn’t just about dodging fines—it’s a chance to gain a competitive edge. This article outlines the benefits, challenges, and actionable steps to navigate the PDP Law effectively.

The Upside of Compliance: Beyond Regulatory Checkboxes

Adhering to the PDP Law offers tangible rewards for businesses willing to invest in privacy:

• Attracting Foreign Investment: Companies with strong data protection practices stand out to international investors. A 2023 Deloitte survey revealed that 78% of global investors consider data compliance a key factor in funding decisions. Compliance also aligns with global standards like the GDPR, facilitating cross-border collaborations.
• Enhanced User Trust: Transparent data practices can cut app bounce rates by up to 20%, as privacy-conscious users favor secure platforms.
• Operational Efficiency: Mapping data flows improves system integration, reducing onboarding times for new tools by an estimated 30%.
• Risk Mitigation: Proactive compliance lowers the odds of sanctions, reputational harm, and expensive breach recoveries.

Managing Incidents and Data Breaches: A Team Effort

A data breach demands more than an IT fix—it’s a company-wide challenge. The PDP Law requires notifying regulators and affected parties within 72 hours of detection. Delays can be costly: in 2023, an Indonesian e-commerce company took a week to report a phishing breach affecting 50,000 users, resulting in a 15% trust drop and a PR crisis.

Key elements of effective incident management include:

• Standard Operating Procedures (SOPs): Define clear escalation paths for regulators and internal teams.
• Cross-Functional Response: IT contains the breach, Legal ensures compliance, HR addresses staff errors, and PR manages messaging.
• Documentation: Log incidents thoroughly for reporting and future safeguards.

Three Common Challenges and How to Tackle Them

Compliance isn’t without hurdles. Here’s how to address them:

Case Study: A clinic cut human error incidents by 40% in six months after introducing quarterly phishing drills.

Five Practical Steps to Strengthen Compliance

Start today with these actionable steps:

1. Conduct a Quick Audit
   Identify sensitive data (e.g., IDs, health records) and assess storage and access controls against PDP Law standards. Tip: Use a checklist for completeness.
2. Appoint a Temporary Data Protection Officer (DPO)
   While not always required, a DPO can streamline compliance efforts. A Jakarta fintech saw a 40% risk reduction after assigning one during the transition.
3. Draft a 72-Hour Notification Template
   Prepare customizable notices for regulators and users, ensuring rapid, compliant communication during incidents.
4. Perform a Concise DPIA
   For high-risk operations (e.g., financial data processing), a Data Protection Impact Assessment pinpoints risks and solutions like encryption.
5. Run Incident Simulations
   Test your response with mock breaches, involving IT, Legal, PR, and leadership. Regular drills can cut response times in half.

Quick Wins for SMEs and Startups

Limited budget? These steps deliver big results fast:

• Simplified Consent Forms: Clear, concise forms boost trust—a local retailer saw 25% more sign-ups after streamlining theirs.
• Two-Factor Authentication (2FA): Adding 2FA to dashboards cuts unauthorized access risks by 70%.
• Automated Logs: Plugins for data tracking save 20 hours monthly and ensure audit-readiness.

Expert Insights: Voices from the Field

• “Build privacy into your systems from the start—waiting for full regulations is a missed opportunity.” — Rindy, CEH
• “A breach affects more than IT. Without HR, Legal, and PR alignment, reputational costs skyrocket.” — Syahraki Syahrir, CISA
• “Compliance is a mindset, not a one-off task. Start small and scale up.” — Imelda, Data Privacy Consultant

Closing Thoughts: Privacy as a Way of Life

The PDP Law’s transition period is history, but compliance is an ongoing commitment. Audits, training, and simulations lay the groundwork for resilience and trust. In a data-centric world, privacy isn’t just a rule—it’s a business advantage. Take action now and make data protection your strength.

Sources and References

• Law No. 27 of 2022 on Personal Data Protection

• Privasimu, Marsh, ELSAM: Regulatory updates and risk insights

• Kominfo, Liputan6, Kompas: PDP Law enforcement and mitigation trends

• YouTube: “Indonesia’s PDP Law in Transition” Webinar (https://www.youtube.com/watch?v=VeIZto8EMQA)

 DISCLAIMER: