Legal Status of KDMP Cooperatives Questioned Amid Rapid Formation

Koperasi Desa/Kelurahan Merah Putih (KDMP), launched on October 28, 2025, has experienced unprecedented growth, with thousands of village and sub-district cooperatives established across Indonesia in just months. This rapid expansion, driven by presidential directives, has been lauded as a breakthrough for grassroots economic development.

However, the formation of KDMP raises fundamental questions about its legal legitimacy. The core issue lies in its reliance on Presidential Instructions, such as Instruction No. 9 of 2025, as the primary legal instrument for its establishment, rather than strictly adhering to the established procedures outlined in Law No. 25 of 1992 concerning Cooperatives.

This reliance on administrative directives, which carry significant weight and broad societal implications, contrasts with the formal legal framework for cooperatives. While the law mandates specific procedures for formation, including notary deeds and ministerial approval, the Presidential Instructions appear to have taken precedence, turning the legal process into a mere formality. This inversion of the typical legal hierarchy, where laws should guide and subordinate instruments, is central to the ongoing debate about KDMP's legal standing.