The Directorate General of Taxation of Indonesia issued a new regulation to prevent the misuse of double taxation agreements and avoidance of taxes (“Directorate General Taxation No.PER-62/PJ/2009 of 2009 regarding Prevention of Misuse of Double Taxation Agreement (November 5, 2009) (“DG Tax 62/09”)). The definition of Avoidance of Double Taxation Agreement (“P3B”) is any agreement between Indonesia and other countries within the framework of preventing tax avoidance and evasion. The type of actions that consider as misuse of P3B amongst others e.g. (a) the transaction which does not have any economic substance however that transaction is designed in the framework to obtain the advantage of P3B; (b) the transaction with the scheme whose legal form is different from the economic substances for the purpose to obtain the advantage of P3B; (c) the income recipient is not the beneficial owner of the economic benefit. Further, the beneficial owner does not act as an agent, nominee or a conduit company. This regulation will come into force on January 1, 2010.