<![CDATA[This article examines the disparity of authority between Regional Governments and the Free Trade Zone and Free Port Concession Agency (BP KPBPB) in Indonesia, particularly in the governance of strategic economic areas. The study addresses two central issues: the institutional regulation of KPBPB and the formulation of an appropriate institutional design for its management. Using a socio-legal method with statutory, conceptual, comparative, and multidisciplinary approaches, the article analyzes how overlapping mandates affect legal certainty, administrative effectiveness, investment governance, and regional development. The findings show that KPBPB governance is constructed through a dualistic authority structure. Regional Governments derive legitimacy from constitutional decentralization, while BP KPBPB exercises delegated authority from the central government. This arrangement generates institutional friction in licensing, spatial planning, land management, asset control, infrastructure provision, and fiscal accountability. A comparison with Malaysia’s Free Zone model demonstrates that clearer hierarchical authority and functional separation between policy-making and implementation can strengthen coordination and legal certainty. The article argues that Indonesia requires regulatory harmonization, a permanent inter-institutional coordination mechanism, integration of regional and zone development planning, function-based division of authority, and stronger financial independence of BP KPBPB to ensure efficient, accountable, and sustainable free trade zone governance within Indonesia’s decentralized administrative framework]]>
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