A recent Financial Services Authority (OJK) regulation sets out new disclosure obligations that apply to issuers and public companies in Indonesia and creates a new penalty regime for non-compliance. The regulation is significant for investors with an interest in the Indonesian Stock Exchange and is consistent with other measures that the OJK has taken to improve transparency and align the reporting obligations of issuers and public companies with international standards.
The Financial Services Authority (OJK) recently amended public companies' obligation to report on their shareholding by way of OJK Regulation 11/POJK.04/2017 regarding Reporting on Public Company Ownership or on Every Change in Share Ownership. The regulation aims to bring public companies' reporting obligations in line with international standards.
The Financial Services Authority (OJK) has issued a regulation setting out the criteria for exemption from the reporting and announcement obligations ordinarily imposed on issuers and public companies with securities and shares registered at the Indonesian Stock Exchange. The exemption must be confirmed by way of an OJK decision letter, but can be rescinded if the entity no longer meets the established exemption criteria.
A new regulation on rights issues was passed by the Financial Services Authority in December 2015. The regulation introduces key changes relating to rights issue approval, effective statements, non-cash capital injections, announcements and company and shareholder requirements, and is intended to provide investors with more flexibility and ease when conducting rights issues.
The newly established Financial Services Authority recently issued a set of regulations governing the financial services industry. The regulations are intended to promote sustainability, stability and competitiveness in light of the increasing complexity of transactions and interactions between financial institutions, as well as between companies within a financial conglomerate.
The chairman of the Indonesian securities regulator, Bapepam-LK, has issued a new regulation on material transactions. The regulation seeks not only to perfect the regulation of material transactions, but also to simplify the procedure for a public company to obtain funding through private offerings of debt securities.
Parliament's long-awaited approval of the Bill on the Financial Services Authority is one of the most significant developments in the history of Indonesian law and will change the landscape of the country's financial industry. It not only establishes a new financial services authority, but also positions this new body as the main regulator and supervisor of Indonesia's financial sector.
The head of the Indonesian Financial Transactions Report and Analysis Centre has issued a new regulation on the procedure for the submission of reports on suspicious financial transactions. Among other things, the regulation is intended to prevent and eventually abolish money laundering, and to improve the reporting system used by financial providers.
After allowing issuers and public companies to issue shares with nominal value during the last financial crisis in the late 1990s, Bapepam – the Capital Market and Financial Institutions Supervisory Agency – finally issued Regulation IX.D.6 on the issuance of shares with different nominal value, which provides formal regulatory framework for this type of share issuance.
The Capital Markets and Financial Markets Supervisory Agency has issued a regulation that contains extensive provisions on trustee-related matters, enumerating trustees' tasks, obligations and prohibited actions. However, most of the regulation deals with trusteeship contracts, including the identity of the parties in a debt issuance agreement, buy-back mechanisms and the tasks and obligations of a paying agent.
The Capital Market and Financial Institutions Supervisory Board has issued guidelines on the management of individual customers' securities portfolios. The guidelines were issued as Regulation VG6, which aims to regulate discretionary fund management for the funds of a securities company's individual customers, and requires fund managers to enter into a discretionary fund agreement with the investor concerned.
The Capital Markets and Financial Institutions Supervisory Agency has issued a regulation regarding application of the 'know your customer' principle by financial services providers in the capital markets sector. Among other things, financial services providers must establish a working unit or assign an officer of a rank below the director to be in charge of application of the 'know your customer' principle.
A revision to the Regulation on Affiliated Transactions and Conflict-of-Interest Transactions has clarified the term 'affiliated transaction' and - among other things - requires companies to present a comparative analysis if another transaction of the same nature is conducted simultaneously. Other regulatory changes redefine the term 'material transaction' and raise the qualifying threshold for such transactions.
The Capital Market and Financial Institution Supervisory Agency is continuing its efforts to improve the efficiency and effectiveness of public offering procedures. Among other things, a new regulation allows the agency to issue a statement that allows an issuer to conduct book building. It also provides issuers with mechanisms for discontinuing and suspending an offering because of market conditions.
The Capital Market and Financial Institution Supervisory Agency has issued long-awaited rules and regulations on securities rating agencies. The new regulations require an agency's directors, commissioners and analysts to meet standards of integrity, competence and expertise.
The Indonesian Stock Exchange's Regulation on Margin Transactions and Short Selling is aimed at providing greater clarification on the procedures for obtaining approval for margin and short-selling activities by members of the stock exchange. It clarifies the reporting requirements and periodical inspection regime to which members are subject.
The Jakarta Stock Exchange (JSX) has issued amendments to the listing rules which aim to simplify the listing requirements and enhance investor protection by improving the quality of the shares traded on the JSX. Among other things, listed companies must now have at least one non-affiliated director.
Bapepam, the Indonesian Capital Market Supervisory Agency, recently amended two regulations on the registration of initial public offers and rights issues, with the aim of simplifying and expediting these procedures. It has also modified the procedure for reporting the use of proceeds of a public offer.
Bapepam - Indonesia's Capital Markets Supervisory Board - recently confirmed that stock index futures are categorized as 'securities' as defined under the Capital Markets Law. It has also issued a new regulation stating that the trading of state debt securities off the stock exchange must be carried out by a licensed limited liability company.
Bapepam, Indonesia's capital markets supervisory agency, has confirmed that the offer procedure for debt securities denominated in foreign currency is largely identical to the general public offer procedure, although additional disclosure in the prospectus will be required. Information that must be disclosed includes whether a hedging facility or repayment fund is available.