BAPPEBTI REGULATION

OF THE REPUBLIC OF INDONESIA

NUMBER 3 OF 2021

CONCERNING

TECHNICAL PROVISIONS FOR THE ORGANIZATION OF SPOT COMMODITY AUCTION MARKETS

WITH THE GRACE OF GOD THE ALMIGHTY

THE HEAD OF THE COMMODITY FUTURES TRADING REGULATORY AGENCY OF THE REPUBLIC OF INDONESIA,

Considering: a. that in order to implement the provisions of Article 2 paragraph (3) of Bappebti Regulation Number 7 of 2018 concerning Approval for the Organization of Commodity Auction Markets and to meet technical needs related to the organization of Commodity Auction Markets that provide business certainty and legal certainty to all relevant stakeholders, it is necessary to regulate technical provisions for the organization of Commodity Auction Markets with immediate delivery time (spot); b. that based on the considerations as referred to in letter a, it is necessary to establish a Bappebti Regulation concerning Technical Provisions for the Organization of Commodity Auction Markets with Immediate Delivery Time (Spot);

Recalling:

1. Law Number 32 of 1997 concerning Commodity Futures Trading (State Gazette of the Republic of Indonesia Year 1997 Number 93, Supplement to the State Gazette of the Republic of Indonesia Number 3720) as amended by Law Number 10 of 2011 concerning Amendments to Law Number 32 of 1997 concerning Commodity Futures Trading (State Gazette of the Republic of Indonesia Year 2011 Number 79, Supplement to the State Gazette of the Republic of Indonesia Number 5232);
2. Law Number 7 of 2014 concerning Trade (State Gazette of the Republic of Indonesia Year 2014 Number 45, Supplement to the State Gazette of the Republic of Indonesia Number 5512);
3. Presidential Regulation Number 48 of 2015 concerning the Ministry of Trade (State Gazette of the Republic of Indonesia Year 2015 Number 90);
4. Presidential Regulation Number 68 of 2019 concerning the Organization of State Ministries (State Gazette of the Republic of Indonesia Year 2019 Number 203);
5. Minister of Trade Regulation Number 80 of 2020 concerning the Organization and Work Structure of the Ministry of Trade (State News of the Republic of Indonesia Year 2020 Number 1190);
6. Decision of the Minister of Industry and Trade of the Republic of Indonesia Number :650/Mpp/Kep/10/2004 Concerning Provisions for the Organization of Auction Markets with Deferred Delivery (Forward) of Agro Commodities;
7. Bappebti Regulation Number 7 of 2018 concerning Approval for the Organization of Commodity Auction Markets;

DECIDES:

To establish: BAPPEBTI REGULATION CONCERNING TECHNICAL PROVISIONS FOR THE ORGANIZATION OF SPOT COMMODITY AUCTION MARKETS.

CHAPTER I

INSTITUTIONALIZATION OF COMMODITY AUCTION MARKETS

First Section

Commodity Auction Market Organizers

Article 1

(1) Commodity Auction Market Organizers may conduct Commodity Auction Market activities with deferred delivery time (forward) and/or with immediate delivery time (spot). (2) The organization of Commodity Auction Markets with deferred delivery time (forward) is regulated based on legislation governing the provisions for the Organization of Auction Markets with Deferred Delivery (Forward) of Agro Commodities. (3) The organization of Commodity Auction Markets with immediate delivery time (spot) as referred to in paragraph (1) is conducted by cooperatives, limited liability companies, state-owned enterprises, or regional-owned enterprises after obtaining approval from Bappebti. (4) In addition to Commodity Auction Market Organizers with immediate delivery time (spot) as referred to in paragraph (3), Provincial Offices in charge of trade may act temporarily as Commodity Auction Market Organizers with immediate delivery time (spot) until the transfer to a Commodity Auction Market Organizer with immediate delivery time (spot) in the form of a cooperative, limited liability company, state-owned enterprise, or regional-owned enterprise.

Article 2

To obtain approval from Bappebti as a Commodity Auction Market Organizer with immediate delivery time (spot) as referred to in Article 1 paragraph (3), cooperatives, limited liability companies, state-owned enterprises, or regional-owned enterprises must submit the following requirements:

a. For business entities in the form of cooperatives, must submit:

1. a balance sheet prepared and approved at the last Annual General Meeting;
2. a business plan for 3 (three) years;
3. Rules and Regulations (PTT) approved by Bappebti;
4. answers to the questionnaire regarding the integrity of the applicant (management and supervisors of the cooperative); and
5. minutes of the inspection of physical facilities and infrastructure stating compliance with applicable legislation.

b. For business entities in the form of limited liability companies, must submit:

1. a balance sheet no later than 90 (ninety) days before the approval application or audited financial reports;
2. a business plan for 3 (three) years;
3. Rules and Regulations (PTT) approved by Bappebti;
4. answers to the questionnaire regarding the integrity of the applicant (board of directors, board of commissioners, and shareholders); and
5. minutes of the inspection of physical facilities and infrastructure stating compliance with applicable legislation.

c. For business entities in the form of state-owned enterprises and regional-owned enterprises, must submit:

1. a balance sheet no later than 90 (ninety) days before the approval application or audited financial reports;
2. a business plan for 3 (three) years;
3. Rules and Regulations (PTT) approved by Bappebti;
4. answers to the questionnaire regarding the integrity of the applicant (board of directors, board of commissioners, and shareholders); and
5. minutes of the inspection of physical facilities and infrastructure stating compliance with applicable legislation.

Article 3

Prospective Commodity Auction Market Organizers must submit an electronic application via http://plk.bappebti.go.id to the Head of Bappebti, attaching the requirements as referred to in Article 2.

Article 4

(1) Commodity Auction Market Organizers with immediate delivery time (spot) have the duties and authorities: a. to prepare auction systems, facilities, and infrastructure for the organization of Commodity Auction Markets; b. to determine auction mechanisms, execution times, commodity specifications, and auction sessions; c. to evaluate and test the qualifications of candidates and accept or reject them as Members of the Commodity Auction Market; d. to determine the amount of member deposits and service fees for auction organization; e. to supervise the settlement of sales contracts between members occurring in the Auction Market; f. to take necessary actions to secure Auction Market transactions, including preventing possible price and commodity quality manipulation; g. to determine mechanisms for resolving complaints and disputes related to Auction Market transactions; and h. to take steps to guarantee the implementation of Auction Market transaction mechanisms.

(2) The auction system as referred to in paragraph (1) letter a is the Integrated Auction Market System (SPLT) provided by Bappebti or the auction system owned by the Commodity Auction Market Organizer with immediate delivery time (spot) that has obtained Bappebti approval.

Second Section

Commodity Auction Market Members

Article 5

(1) Members of the Commodity Auction Market consist of: a. individuals; or b. business entities.

(2) Individual Members of the Commodity Auction Market as referred to in paragraph (1) letter a consist of: a. Indonesian Citizens, as sellers and/or buyers; and b. Foreign Citizens, only as buyers.

(3) Business Entity Members of the Commodity Auction Market as referred to in paragraph (1) letter b consist of: a. Indonesian business entities, as sellers and/or buyers; and b. foreign business entities, only as buyers.

(4) Members of the Commodity Auction Market as referred to in paragraph (1) must meet at least the following requirements: a. have a good reputation and integrity in trade and finance; b. have a good institutional reputation as a healthy legal entity for business entities with legal entity status; c. have fulfilled financial membership obligations; and d. have signed a statement agreeing to abide by the regulations and rules of the Commodity Auction Market Organizer.

Article 6

(1) Prospective Members of the Commodity Auction Market who have met the membership requirements as referred to in Article 5 paragraph (4) are given membership credentials in the form of physical or electronic documents by the Commodity Auction Market Organizer. (2) The Commodity Auction Market Membership Credentials as referred to in paragraph (1) are valid nationally as long as the holder is still active in Commodity Auction Market activities. (3) In the event that the physical document of membership credentials as referred to in paragraph (1) is lost or damaged, the Commodity Auction Market Organizer must replace it with a new physical document of membership credentials.

Article 7

Every Member of the Commodity Auction Market with immediate delivery time (spot) is required to pay member deposits, guarantee money, and service fees for the organization of the Commodity Auction Market, the value of which is determined by the Commodity Auction Market Organizer.

CHAPTER II

ORGANIZATION OF SPOT COMMODITY AUCTION MARKETS

Article 8

(1) Commodity Auction Market Organizers organizing Commodity Auction Markets with immediate delivery time (spot) must: a. form an auction guarantee unit; b. submit confirmation of commodity sales transactions that have occurred in the Commodity Auction Market to the seller and buyer participants; c. submit information regarding the rights and obligations of each seller and buyer participant for every unfinished transaction; d. submit auction transaction reports to Bappebti no later than 3 (three) working days after the auction closes using Form.1 as contained in the Appendix of this Regulation; e. report breaches of contract to Bappebti no later than 3 (three) working days after the report is received by the Commodity Auction Market Organizer; f. submit auction activity reports to Bappebti consisting of:

1. monthly auction activity reports containing at least information on auction transaction realization, submitted no later than on the 7th day after the end of the reporting period using Form.2 as contained in the Appendix of this Regulation;
2. quarterly auction activity reports submitted no later than on the 15th day after the end of the reporting period using Form.3 as contained in the Appendix of this Regulation;
3. annual auction activity reports submitted no later than 30 (thirty) working days after the end of the reporting year using Form.4 as contained in the Appendix of this Regulation. g. prepare at least 1 (one) operator to conduct reporting.

(2) In the event that the submission date for auction transaction reports as referred to in paragraph (1) letter d, reports of breaches of contract as referred to in paragraph (1) letter e, and auction activity reports as referred to in paragraph (1) letter f fall on a holiday, the reports must be submitted on the next working day.

Article 9

(1) The organization of Commodity Auction Markets with immediate delivery time (spot) is conducted by observing the following provisions: a. commodities traded are regional flagship commodities; b. commodities to be traded are available; c. commodities to be traded as referred to in letter b are under the control of the Commodity Auction Market Organizer; d. the quality, volume, and type of commodities have undergone suitability assessment; e. commodities as referred to in letter c serve as transaction guarantees for Members of the Commodity Auction Market with immediate delivery time (spot) as sellers; f. Members of the Commodity Auction Market with immediate delivery time (spot) as buyers place transaction guarantees in the form of money or securities with the Commodity Auction Market Organizer; and g. payment is executed on the day of the transaction and commodity delivery is carried out immediately after the transaction occurs according to agreement.

(2) Commodities as referred to in paragraph (1) letter c must be placed by the seller: a. in warehouses at the location of the Commodity Auction Market; b. in Warehouse Receipt System warehouses; or c. in the seller's warehouse or other warehouses approved by the Commodity Auction Market Organizer.

(3) In the event that commodities are placed in Warehouse Receipt System warehouses as referred to in paragraph (2) letter b, commodities may be represented by copies of Warehouse Receipts.

(4) In the event that commodities are placed in the seller's warehouse or other warehouses approved by the Commodity Auction Market Organizer as referred to in paragraph (2) letter c, commodities may be represented by commodity samples.

(5) In the event that transaction guarantees for Members of the Commodity Auction Market with immediate delivery time (spot) as sellers as referred to in paragraph (1) letter e are deemed insufficient, the Commodity Auction Market Organizer may request additional transaction guarantees in the form of money or securities.

Article 10

(1) Commodity quality specifications traded in Commodity Auction Markets with immediate delivery time (spot) are determined in writing by the Commodity Auction Market Organizer and are an inseparable part of the sales contract.

(2) If the Commodity Auction Market Organizer does not determine commodity quality specifications as referred to in paragraph (1), the seller participant may declare the commodity quality specifications to be traded in the Commodity Auction Market with immediate delivery time (spot) in writing, which is an inseparable part of the sales contract.

Article 11

(1) In granting approval to Commodity Auction Market Organizers to organize Commodity Auction Markets with immediate delivery time (spot), Bappebti: a. checks the completeness and accuracy of required documents; b. evaluates the 3 (three) year business plan; c. approves the Rules and Regulations (PTT); d. conducts suitability and feasibility interviews with management/board of directors, supervisors/commissioners, and shareholders regarding ethics, morality, knowledge of Commodity Auction Markets, and ensures freedom from criminal acts as stated in an integrity pact signed according to Form.5 as contained in the Appendix of this Regulation; and e. inspects the physical facilities and infrastructure of prospective Commodity Auction Market Organizers.

(2) Bappebti grants or does not grant approval to Commodity Auction Market Organizers to organize Commodity Auction Markets with immediate delivery time (spot) no later than 3 (three) working days after all requirement documents are complete and accurate and interviews including physical facility and infrastructure inspections have been conducted.

(3) The Head of Bappebti grants approval to Commodity Auction Market Organizers to organize Commodity Auction Markets with immediate delivery time (spot) using Form.6 as contained in the Appendix of this Regulation.

Article 12

(1) Buy and sell offers in Commodity Auction Markets with immediate delivery time (spot) are conducted electronically online through the Integrated Auction Market System (SPLT) provided by Bappebti or the auction system owned by the Commodity Auction Market Organizer with immediate delivery time (spot) that has obtained Bappebti approval.

(2) If under certain conditions buy and sell offers in Commodity Auction Markets cannot be conducted electronically online as referred to in paragraph (1), then buy and sell offers in Commodity Auction Markets are conducted openly based on samples, Warehouse Receipts, and/or quality specifications.

(3) Certain conditions as referred to in paragraph (2) include: a. internet disturbances; b. electricity disturbances; c. equipment limitations; d. human resource limitations of the Commodity Auction Market Organizer; and/or e. force majeure conditions.

Article 13

(1) Sales contracts may be digital documents (non-physical) or physical documents according to the auction mechanism used by the Commodity Auction Market Organizer.

(2) Sales contracts as referred to in paragraph (1) must first be approved by the seller and buyer participants, binding legally for both parties.

Article 14

(1) Offered prices and records in the organization of Commodity Auction Markets with immediate delivery time (spot) use the Rupiah currency.

(2) In the event that the buyer participant is from abroad, the seller may offer sales quotations in US Dollars.

(3) Commodity Auction Market Organizers must convert and record transaction settlement prices in Rupiah currency (Indonesia Dalam Rupiah/IDR).

(4) The resulting price is stated in the commodity sales contract, including price variations based on quality variations, and cannot be changed by the seller or buyer participant until the transaction is settled.

CHAPTER III

SANCTIONS

Article 15

(1) Commodity Auction Market Organizers with immediate delivery time (spot) that do not perform duties and/or obligations as regulated in this Regulation are subject to administrative sanctions.

(2) Administrative sanctions as referred to in paragraph (1) imposed on Commodity Auction Market Organizers with immediate delivery time (spot) consist of: a. written warnings; b. suspension of business activities; and/or c. revocation of approval.

Article 16

(1) Commodity Auction Market Organizers with immediate delivery time (spot) that do not actively conduct auction activities for 1 (one) year are subject to the sanction of revocation of approval.

(2) Commodity Auction Market Organizers with immediate delivery time (spot) that do not perform duties and/or authorities as referred to in Article 4 paragraph (2), and/or Article 8 paragraph (1) letter a are subject to the sanction of suspension of business activities.

(3) Commodity Auction Market Organizers with immediate delivery time (spot) that are late in submitting reports as referred to in Article 8 paragraph (1) letter b, letter c, letter d, letter e, letter f, and/or letter h are subject to the sanction of written warnings.

(4) Suspension of business activities as referred to in paragraph (2) is imposed for a period of 1 (one) year from the issuance of the Decision of the Head of Bappebti regarding the suspension of business activities.

(5) Written warnings as referred to in paragraph (3) are given at most 3 (three) times consecutively.

(6) If the party that has obtained approval from Bappebti as a Commodity Auction Market Organizer with immediate delivery time (spot) does not comply with the final written warning as referred to in paragraph (5), the sanction of suspension of business activities is imposed.

CHAPTER IV

TRANSITIONAL PROVISIONS

Article 17

With the implementation of this Regulation, Commodity Auction Market Organizers that have obtained approval from Bappebti as Organizers of Auction Markets with deferred delivery time (forward) may organize Commodity Auction Markets with deferred delivery time (forward) and Commodity Auction Markets with immediate delivery time (spot).

APPENDIX

BAPPEBTI REGULATION

NUMBER 3 OF 2021

CONCERNING TECHNICAL PROVISIONS

FOR THE ORGANIZATION OF

SPOT COMMODITY AUCTION MARKETS

FORM.1

COMMODITY AUCTION MARKET TRANSACTION REPORT FORMAT

Organizer : Auction Date :

NO.	SELLER	SELLER NO.	BUYER	BUYER NO.	COMMODITY	TYPE	VOLUME	PRICE	TOTAL	STATUS REALIZATION *)	NOTES *)