• Redrafted: Issuance of Shares with Different Nominal Values
Newsletter:

Redrafted: Issuance of Shares with Different Nominal Values

08 August 2017

As the Indonesian Regulatory Body for the Capital Market and Financial Institutions (Bapepam-LK) has been replaced by the Financial Services Authority (OJK) since December 2012, the OJK now is in charge of the functions, roles, and regulationsetting & supervision rights previously held by the Bapepam-LK. As part of the shift, the OJK is now re-issuing various provisions previously drafted by the Bapepam-LK to reflect such effect.

Issuance of Shares with Different
Nominal Values One of the regulations that was recently redrafted in June 2017 is in relation to the ability of listed companies to issue shares with different nominal values. This is only applicable if the market price of the shares is below the original nominal values.
These shares must also meet the following requirements:
a.The shares with the same classifications but have different nominal values shall have equal rights; and
b.The shares that were previously issued with the original nominal values cannot be converted into shares with new (different) nominal values.

 

Sanctions
Administrative sanctions will apply against any parties that violate the OJK provisions in relation to this, such as:

a. Letters of warnings;
b. Fines;
c. Restrictions on Business Activity;
d. Temporary Suspension on
Business Activity;
e. Permanent Suspension on
Business Activity;
f. Revocation on any Approvals
previously provided; and/or
g. Revocation on any Registrations
previously conducted.

All of these sanctions may be imposed without any prior written notice per section (a). Fines per section (b) can be imposed on its own or together with other types of sanctions on section (c), (d), (e), (f) or (g).

 

Implications to Companies and Investors
Apart from the fact that the provisions are now regulated by the OJK, there are no specific changes or implications to companies and investors as this is a redrafted version of the existing regulations set by the Bapepam-LK in 2010.

 

 

For more information on how BDO can help you in planning and navigate this major changes, please contact our technical team at corsec.helpdesk@bdo.co.id


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