Regulatory Alerts2014-09-17
Bank Indonesia Regulation Number 16/17/PBI/2014 Concerning Foreign Exchange Transactions against Rupiah between Banks and Foreign Parties
Bank Indonesia issued Regulation Number 16/17/PBI/2014 to deepen the domestic foreign exchange market by establishing comprehensive guidelines for transactions between banks and foreign parties. The regulation mandates that banks maintain internal guidelines and requires underlying transactions for most foreign exchange activities, while permitting spot purchases up to USD 100,000 and derivative transactions up to USD 1,000,000 without such documentation. It further prohibits specific activities like lending in Rupiah and capital investments, sets strict settlement and documentation requirements, and imposes administrative sanctions and financial penalties for non-compliance.
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