The Indonesia Stock Exchange (IDX) will increase the minimum ratio of shares that need to be listed on the IDX by a listed company. Through Regulatory No. I-A regarding the Listing of Shares & Equity Securities other than Shares Issued by Listed Companies (Peraturan Nomor I-A tentang Pencatatan Saham dan Efek Bersifat Ekuitas yang Diterbutkan oleh Perusahaan Tercatat), the minimum ratio of publicly issued shares is 7.5% of a company's total enlarged capital. If companies will not comply, they may face de-listing from the IDX.
17 February 2020 (closed)
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Companies regularly perform changes in their shareholder structure. However, when foreign investment companies (PT PMA) in Indonesia intent to increase the percentage of foreign shareholder ownership in the PT PMA, they should be aware of possible investment restrictions. The negative investment list based on Presidential Regulation no. 44 of 2016 (Regulation 2016) set the latest investment restrictions to foreign investors. In this column we discuss in which application of the Regulation 2016 focusing on changes in shareholder structure.
Increase of share capital of a foreign investment limited liability company (PT PMA) in Indonesia requires amendments of several documents and licenses. In this column we explain the implications for a PT PMA that wishes to increase its share capital. The process for increase of share capital includes a shareholder’s decision, amendment of the investment licenses and amendment of the company data at the ministry of Law and Human Rights.
The general provisions regarding shares in an Indonesian limited liability company (PT for local companies and PT PMA for foreign companies in Indonesia) are regulated in Indonesian Law number 40 of 2007 concerning Limited Liability Companies (Company Law). The Company Law regulates the minimum authorized capital and paid-up capital, and stipulates procedural rules related to the purchase, ownership and sales of shares. In this column we discuss the general rules governing shares of a limited liability company in Indonesia.
Sale-and-Buy-Back of Shares is a method which can be utilized by foreign companies (PMA) in Indonesia to fulfill their divestment requirement. Such divestment requirement is usually stated in their Principle License (Izin Prinsip) and/or in the Business License (Izin Usaha). In a Sale-and-Buy-Back of shares construction, shares are temporary sold to a trusted Indonesian party. After all governmental requirements are fulfilled the shares are bought back by the PMA. In this column we will discuss the Sale-and-Buy-Back of shares procedure.
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