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2014-09-17

Bank Indonesia Regulation Number 16/16/PBI/2014 Concerning Foreign Exchange Transactions against Rupiah between Banks and Domestic Parties

Bank Indonesia issued Regulation Number 16/16/PBI/2014 to deepen the foreign exchange market by establishing comprehensive guidelines for foreign exchange transactions against the Rupiah between banks and domestic parties. The regulation mandates that banks maintain written internal guidelines and requires underlying transaction documentation for transactions exceeding specific thresholds, while allowing spot and derivative purchases up to USD 100,000 and sales up to USD 1,000,000 without such documentation. It further stipulates settlement procedures, prohibits transactions involving structured products or overdrafts for forex purposes, and imposes administrative sanctions and financial penalties on banks that violate these provisions.

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Sumber Data Legal Information Division, Department of Legal Affairs

9/16/2014 5:00 PM

Judul Bank Indonesia Regulation Number 16/16/PBI/2014 Dated 17 September 2014 Concerning Foreign Exchange Transactions against Rupiah between Banks and Domestic Parties

Peraturan Bank Indonesia

Moneter dan Pasar Keuangan

Berlaku

Bank Indonesia Regulation

Monetary

Effective

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Bank Indonesia Regulation Number 16/16/PBI/2014 Dated 17 September 2014 Concerning Foreign Exchange Transactions against Rupiah between Banks and Domestic Parties

Effective

10 November 2014

Summary

This Regulation of Bank Indonesia (PBI)

is issued to encourage the deepening of foreign exchange market through a comprehensive regulation related to Foreign Exchange Transactions against Rupiah between Banks and Domestic Parties. This PBI is an improvement of several regulations associated with foreign exchange transactions against Rupiah to provide clearer guidelines on transactions and flexibility to market participants.

II.

Substances stipulated in PBI concerning Foreign Exchange Transactions against Rupiah between Banks and Domestic Parties are among others :

Banks must have written internal guidelines in performing Foreign Exchange Transactions against Rupiah.

The Foreign Exchange Transactions against Rupiah performed by Banks with Customers above the threshold must have Underlying Transactions.

Underlying Transactions for

Foreign Exchange Transactions against Rupiah between Banks and Domestic Parties cover all activities :

Goods and services trading, both domestic and overseas; and/or

Investments in the form of direct investment, portfolio investment, loans, capital, and other investments, both domestic and overseas .

Not included as Underlying Transactions

for

Foreign Exchange Transactions against Rupiah between Banks and Domestic Parties are :

Placement of funds in the Banks among others in the form of savings , demands deposits , time deposits , and Negotiable Certificate of Deposit (NCD); and

Activities of transfering funds by funds transfer companies .

Buying foreign currencies against Rupiah by Customers to Banks can be performed without Underlying Transactions through Spot Transactions and/or Derivative Transactions up to the buying threshold of USD100,000.00 (one hundred thousand US Dollar).

Selling foreign currencies against Rupiah by Customers to Banks may be performed without Underlying Transactions through forward or option transactions up to the selling threshold of USD1,000,000.00 (one million US Dollar).

Transaction documents that must be enclosed in the transactions of purchases and/or sales of foreign currencies against Rupiah are governed as follows:

Foreign Exchange Transactions against Rupiah between Banks do not require Underlying Transactions.

Underlying Transaction documents consist of final and estimated documents.

The estimated Underlying Transaction documents require to have supporting documents, in the form of:

Statement Letters from Customers signed by the authorized parties of Customers, containing information on the amount of the needs, purpose of utilization and required date of the foreign currencies, as well as type of transaction performed.

For customers with legal entities, a letter of authorization from the high level management and acknowledged by the Board of Commissioners, if the authorized party is not specified in its articles of association yet.

Submission of Underlying Transaction documents is regulated as follows:

Underlying Transaction documents and/or supporting documents shall be submitted for every transaction based on the date of transaction.

In the event Banks have already known the track record of the Customers well and the Customers submitted final underlying documents, the Customers may submit the supporting documents of foreign exchange transactions regularly.

Underlying Transaction documents and/or supporting documents for Spot Transactions must be received by Banks no later than the value date.

Underlying Transaction documents and/or supporting documents for Derivative Transactions must be received by Banks no later than 5 business days after the transaction date.

In the event the Derivative Transactions have a maturity date less than 5 business days after the transaction date, the Underlying Transaction documents and/or supporting documents must be received by Banks no later than the maturity date.

Banks must administer Underlying Transaction documents of Foreign Exchange against Rupiah.

Settlements of foreign exchange transactions against Rupiah shall be regulated as follows:

Settlements of Spot Transactions between Banks and Customers and inter Banks must be conducted by full movement of funds.

Settlements of Derivative Transactions between Banks and Customers and inter Banks can be performed by netting for roll over, early termination, and unwinding of transactions.

Settlements of Foreign Exchange Transactions against Rupiah performed by Foreign Exchange Traders (Money Changers) and travel agents for the interests of their customers must be done by full movement of funds.

Banks are prohibited from performing transactions among others:

Foreign Exchange Transactions against Rupiah if the transactions or the potential transactions associated with structured products;

Lending or financing in foreign currencies and/or in Rupiah for the interests of Derivative Transactions.

Provision of overdrafts to Customers for the purpose of Foreign Exchange Transactions against Rupiah.

Banks that violate the provisions stipulated in this PBI shall be imposed sanctions as follows:

An administrative sanction in the form of a written warning.

A financial penalty of 1% from the nominal value of the violated transactions for every violation with a minimum amount of Rp10.000.000,00 (ten million Rupiah) and a maximum of Rp1.000.000.000,00 (one billion Rupiah).

Calculation of financial penalties shall use Jakarta Interbank Spot Dollar Rate (JISDOR)

on the date of violation .

Lampiran Attachments

Lampiran 1 Bank Indonesia Regulation Number 16/16/PBI/2014

Lampiran 2 FAQ - Bank Indonesia Regulation Number 16/16/PBI/2014

Lampiran 3

Lampiran 4

Lampiran 5

Lampiran 6

Lampiran 7

Lampiran 8

Lampiran 9

Lampiran 10

Kontak Contact

Kontak Contact Center - BICARA, Phone : (62 21) 500 131

Halaman ini terakhir diperbarui 1/27/2021 9:15 PM

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