Legalizing Village-Owned Enterprises (BUMDES) Through Dialectics of Strengthening

The issuance of Government Regulation in Lieu of Law No. 2 of 2022 regarding Job Creation represents a notable change in the title of Village-Owned Enterprises (BUMDes). Previously classified as business entities, BUMDes are now redefined as legal entities. This transformation carries significant implications for village governance, presenting a range of opportunities and challenges. The objective of this study is to examine and assess the importance and outcomes of BUMDes transitioning into legal entities. In this research, a qualitative normative legal approach was employed, utilizing primary, secondary, and tertiary legal sources obtained through literature reviews and document analysis. Two distinct research approaches were adopted in this article: the statutory approach and the conceptual approach. The study's findings can be summarized as follows: the reclassification of BUMDes as legal entities is intended to clarify their ability to effectively enhance economic management at the village level. Following the enactment of the Job Creation Regulation, BUMDes acquired legal status similar to a Limited Liability Company (PT). This new status is also on par with State-Owned Enterprises (BUMN) nationwide and Regional-Owned Enterprises (BUMD) locally. This change has resulted in a) Adjustments in the position and organizational structure of BUMDes; b) Enhanced authority to engage in collaborations with other entities; and c) The capacity to secure loans and financial resources.