OJK Regulation on Disclosure of Material Information
The Indonesian Financial Services Authority (Otoritas Jasa Keuangan – “OJK”) issued OJK Regulation No. 31/POJK.04/2015 on December 22, 2015 regarding Disclosure on Material Information or Facts by Issuers or Public Companies (“POJK No.31/2015”). POJK No.31/2015 replaces the previous regulation issued by the Head of Capital Market Supervisory Body (“Bapepam”) under the Decision No. KEP-86/PM/1996 regarding Disclosure of Information That Must Be Immediately Announced to Public (“Regulation No. X.K.1”).
Compared to Regulation No. X.K.1, POJK No.31/2015 provides additional list of material information and/or facts that need to be disclosed by an Issuer, as well as elaboration on disclosure requirements.
♦ Material Information and Facts under POJK 31/2015
Similar with the previous Regulation No. X.K.1, under the new regulation material information and facts defined as important and relevant information or facts in any events or regarding any facts which may affects (i) the listedshares price and/or (ii) the decision of shareholders, prospective shareholders, or any other party who has an interest of such information or facts (the “Material Information”).
Material Information as stipulated in POJK No. 31/2015 includes:
- A merger, separation of business, consolidation, or formation of a joint venture;
- An offer to purchase any other company’s listed shares;
- Sale and purchase of shares of an Issuer which has material value;
- Distribution of interim dividends;
- Delisting or listing of shares in the Stock Exchange;
- A share split or combination of shares;
- Entering into or disposition of any important contract/agreement;
- New findings or new product invention that give an additional value to the Issuer;
- Change of the Board of Directors or Commissioner composition of an Issuer;
- Sale and purchase of material assets of an Issuer;
- Any dispute against an Issuer and its Board of Directors and Board of Commissioners as well as any labor dispute that may disrupt the operation of an Issuer;
- Replacement of an accountant auditing an Issuer;
- Replacement of a Trustee (Wali Amanat);
- Replacement of a Securities Administration Bureau (Biro Administrasi Efek);
- Amendment of an Issuer’s financial year;
- Debt restructuring;
- An Issuer is under the supervision of a relevant regulator which may affect the business of the Issuer;
- Business restriction of an Issuer by a relevant regulatory agency; or
- Any material event which may cause additional financial obligations or cause a disrupt to an Issuer’s revenue.
♦ Reporting and Announcement Procedures
An Issuer shall provide a report to OJK and make an announcement to the public of the occurrence of any Material Information. The announcement shall include the following: (i) the date of an event, (ii) types of Material Information, (iii) description on the Material Information, and (iv) the impact caused by such Material Information.
POJK No.31/2015 provides a standard template for the reporting of Material Information and such report shall be submitted by a Director or if authorized under the power of attorney by the Board of Directors, by the Corporate Secretary of an Issuer.
Based on POJK No.31/2015, the announcement obligation to the public falls under two categories, namely:
- for a listed company, the announcement shall be made through its website (in Indonesian and English language, and any other foreign language (optional)), the Indonesian Stock Exchange’s (IDX) website, as well as at least 1 (one) national newspaper; and
- for a non-listed company, the announcement shall be made through its website (in Indonesian and English language, and any other optional foreign language (optional)) as well as at least 1 (one) national newspaper.
With regard to the language provisions as mentioned above, the Indonesian version of the announcement prevails should there be any discrepancy between the Indonesian and English versions.
Moreover, the report and announcement shall be submitted by the end of 2nd (second) business day after findings of such Material Information.
If any consolidated subsidiary of an Issuer conducts any event listed as Material Information, except for the (i) share split or combination of shares, (ii) distribution of interim dividends, (iii) delisting or relisting of shares in the Stock Exchange, (iv) replacement of a Trustee, or (v) replacement of a BAE, the obligation of reporting and announcing to the public under the POJK No. 31/2015 shall apply to the relevant Issuer.
For any of the Material Information known by a third party and has not been reported nor announced by an Issuer, the Issuer shall report and announce such Material Information as soon as possible.
If an Issuer does not carry out its obligations under POJK No.31/2015 or if any party violates POJK No.31/2015, OJK has the right to impose administrative sanctions in the forms of:
- Warning letters;
- Limitation of business activities;
- Suspension of business activities;
- Revocation of business licenses;
- Cancellation of approval; and
- Cancellation of registration.
The above sanctions are not meant to be imposed jointly and in any particular order, as OJK may impose separate sanctions depending on the non-compliance of an Issuer.
February 22, 2016
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- February 22, 2016