Financial Services Authority Regulation Number 36/POJK.04/2014 on Continuous Offerings of Debt Securities and/or Sukuk

FINANCIAL SERVICES AUTHORITY
REPUBLIC OF INDONESIA
COPY
FINANCIAL SERVICES AUTHORITY REGULATION
NUMBER 36/POJK.04/2014
CONCERNING
CONTINUOUS OFFERINGS OF DEBT SECURITIES AND/OR SUKUK BY THE GRACE OF GOD THE ALMIGHTY, THE COMMISSIONERS OF THE FINANCIAL SERVICES AUTHORITY, Considering: that in order to improve access to financing for Issuers or Public Companies in the Capital Market, thereby making the Capital Market a primary alternative source of more competitive financing for the business world, and to provide certainty regarding the reporting of Issuers or Public Companies conducting Continuous Offerings, it is necessary to improve regulations regarding Continuous Offerings by establishing a Financial Services Authority Regulation on Continuous Offerings of Debt Securities and/or Sukuk; Recalling: 1. Law Number 8 of 1995 concerning the Capital Market (State Gazette of the Republic of Indonesia Year 1995 Number 64, Supplement to the State Gazette of the Republic of Indonesia Number 3608);
2. Law Number 21 of 2011 concerning the Financial Services Authority (State Gazette of the Republic of Indonesia Year 2011 Number 111, Supplement to the State Gazette of the Republic of Indonesia Number 5253);
DECIDES:
Establish: FINANCIAL SERVICES AUTHORITY REGULATION CONCERNING CONTINUOUS OFFERINGS OF DEBT SECURITIES AND/OR SUKUK.

CHAPTER I
GENERAL PROVISIONS
Article 1
In this Financial Services Authority Regulation, the following terms are defined as:

1. Continuous Offerings of Debt Securities and/or Sukuk, hereinafter referred to as PUB Debt Securities and/or Sukuk, is the activity of offering Debt Securities and/or Sukuk conducted in stages.
2. Default is the condition where an Issuer or Public Company is unable to meet financial obligations to creditors at maturity, the value of which is greater than 0.5% (zero point five percent) of paid-up capital.

Article 2
PUB Debt Securities and/or Sukuk may be implemented over a period of 2 (two) years with the provision that the notification of the implementation of the last PUB Debt Securities and/or Sukuk must be submitted to the Financial Services Authority no later than on the second anniversary since the effectiveness of the Registration Statement in the context of PUB Debt Securities and/or Sukuk.

CHAPTER II
PARTY REQUIREMENTS
Article 3
Parties eligible to conduct PUB Debt Securities and/or Sukuk must meet the following criteria:
a. being an Issuer or Public Company for a minimum period of 2 (two) years and having never experienced a Default during the 2 (two) years prior to the submission of the Registration Statement in the context of PUB Debt Securities and/or Sukuk; or b. no longer being an Issuer or Public Company as referred to in letter a, but:

1. has previously conducted a Public Offering of Debt Securities and/or Sukuk;
2. has settled the Securities referred to in number 1 no more than 2 (two) years before submitting the Registration Statement in the context of PUB Debt Securities and/or Sukuk; and
3. from the 2 (two) years prior to settling the Debt Securities and/or Sukuk until the date of submitting the Registration Statement in the context of PUB Debt Securities and/or Sukuk as referred to in number 2, has never experienced a Default.

Article 4
In the event an Issuer experiences a Default during the PUB Debt Securities and/or Sukuk period, the Issuer concerned is prohibited from continuing the offering of Debt Securities and/or Sukuk for the remaining time in the relevant PUB Debt Securities and/or Sukuk period.

CHAPTER III
SECURITY REQUIREMENTS
Article 5
Securities that can be issued through PUB Debt Securities and/or Sukuk are Debt Securities and/or Sukuk that have a rating included in the category of the top 4 (four) ratings, which are the top 4 (four) best ratings, and fall into the investment-grade rating category based on standards owned by the Securities Rating Agency.

Article 6
An Issuer is prohibited from conducting the next stage of offering Debt Securities and/or Sukuk in the PUB Debt Securities and/or Sukuk period if all Debt Securities and/or Sukuk previously issued through PUB Debt Securities and/or Sukuk do not meet the requirements as referred to in Article 5.

Article 7
An Issuer experiencing the condition as referred to in Article 6 may only conduct the next stage of offering Debt Securities and/or Sukuk in the PUB Debt Securities and/or Sukuk period if:
a. the Debt Securities and/or Sukuk to be offered in the next stage and all Debt Securities and/or Sukuk previously issued through PUB Debt Securities and/or Sukuk have met the rating requirements as referred to in Article 5; and b. the PUB Debt Securities and/or Sukuk period has not yet ended.

CHAPTER IV
REGISTRATION STATEMENT
Article 8
The Registration Statement in the context of PUB Debt Securities and/or Sukuk must:
a. follow the provisions of legislation in the Capital Market sector regulating Registration Statements, Public Offerings, and other related regulations, unless otherwise regulated in this Financial Services Authority Regulation; and b. be accompanied by:

1. a statement letter from the Issuer or Public Company stating that the Issuer or Public Company has never experienced a Default during the period as referred to in Article 3 letter a and Article 3 letter b number 3; and
2. a statement letter from the Auditor who audited the financial reports of the Issuer or Public Company stating that the Issuer or Public Company has never experienced a Default during the period as referred to in Article 3 letter a and Article 3 letter b number 3.

Article 9
Issuers or Public Companies conducting PUB Debt Securities and/or Sukuk must include in the Prospectus on:
a. the outer front cover page as follows:

1. “Prospectus for Continuous Public Offering of Debt Securities and/or Sukuk”, also stating the name of the Security; and
2. the total amount of funds to be raised and the type of Security, i.e., Debt Securities and/or Sukuk, to be issued during the PUB Debt Securities and/or Sukuk period.
   b. the chapter regarding Public Offerings concerning the contracts to be used, in the event the issued Security is Sukuk.

CHAPTER V
REPORTING AND INFORMATION DISCLOSURE
Article 10
(1) The Securities Underwriter or the Issuer, in the event of not using a Securities Underwriter, must submit a report on the results of PUB Debt Securities and/or Sukuk to the Financial Services Authority no later than 5 (five) working days after the allocation date in the format and content according to the Form in the attachment of legislation in the Capital Market sector regulating the procedure for Registration Statements in the context of Public Offerings. (2) The Report as referred to in paragraph (1) is accompanied by an allocation report as regulated in legislation in the Capital Market sector regulating allocation reports.

Article 11
(1) In the event that the funds raised during the PUB Debt Securities and/or Sukuk period as referred to in Article 2 are less than planned, no later than 5 (five) working days after the PUB Debt Securities and/or Sukuk period ends, the Issuer must:
a. submit information regarding the total amount of funds raised to the Financial Services Authority accompanied by reasons for the failure to achieve the target funds to be raised; and b. announce to the public regarding the total amount of funds raised accompanied by reasons for the failure to achieve the target funds to be raised at least through:

1. 1 (one) daily newspaper in Indonesian with national circulation or the Stock Exchange website; and
2. the Issuer's website.
   (2) Proof of announcement as referred to in paragraph (1) letter b number 1 must be submitted to the Financial Services Authority no later than 2 (two) working days after the date of the said announcement.

Article 12
(1) In the event an Issuer will terminate PUB Debt Securities and/or Sukuk before the 2 (two) year period, no later than 2 (two) working days after the decision regarding the termination of PUB Debt Securities and/or Sukuk is taken, the Issuer must:
a. submit information regarding the termination of PUB Debt Securities and/or Sukuk to the Financial Services Authority accompanied by reasons for termination and the total amount of funds that have been raised; and b. announce to the public regarding the termination of PUB Debt Securities and/or Sukuk accompanied by reasons for termination and the total amount of funds that have been raised at least through:

1. 1 (one) daily newspaper in Indonesian with national circulation or the Stock Exchange website; and
2. the Issuer's website.
   (2) Proof of announcement as referred to in paragraph (1) letter b number 1 must be submitted to the Financial Services Authority no later than 2 (two) working days after the said announcement.

Article 13
(1) Before conducting the second and subsequent stages of offering Debt Securities and/or Sukuk, no later than 7 (seven) working days before the start of the planned offering period, the Issuer must:
a. submit a notification of the implementation of the said PUB Debt Securities and/or Sukuk accompanied by additional information and supporting documents to the Financial Services Authority; and b. announce the notification of the implementation of PUB Debt Securities and/or Sukuk along with the said additional information at least through:

1. 1 (one) daily newspaper in Indonesian with national circulation or the Stock Exchange website; and
2. the Issuer's website.
   (2) Proof of announcement as referred to in paragraph (1) letter b number 1 must be submitted to the Financial Services Authority no later than 2 (two) working days after the said announcement.

Article 14
Additional information as referred to in Article 13 paragraph (1) must at least contain:
a. the amount of funds raised in PUB Debt Securities and/or Sukuk; b. the number of Securities offered;
c. the interest rate of Debt Securities/return of Sukuk;
d. the rating results of the Security or changes in rating results of the Security (if there are changes in rating results of the Security); e. the schedule of PUB Debt Securities and/or Sukuk; f. the plan for the use of funds or changes in the use of funds; g. a summary of important financial data for the latest financial report compared to the same period in the previous year; h. Securities Underwriter (if any);
i. a statement from the Issuer that all Information or Material Facts have been disclosed and such Information or Material Facts are not misleading;
j. a statement in bold typeface that:

1. “THIS PUBLIC OFFERING IS THE OFFERING OF DEBT SECURITIES AND SUKUK STAGE NO. ... FROM THE CONTINUOUS PUBLIC OFFERING OF DEBT SECURITIES AND SUKUK THAT HAS BECOME EFFECTIVE”;
2. “THIS PUBLIC OFFERING IS THE OFFERING OF DEBT SECURITIES STAGE NO. ... FROM THE CONTINUOUS PUBLIC OFFERING OF DEBT SECURITIES THAT HAS BECOME EFFECTIVE”; or
3. “THIS PUBLIC OFFERING IS THE OFFERING OF SUKUK STAGE NO. ... FROM THE CONTINUOUS PUBLIC OFFERING OF DEBT SUKUK THAT HAS BECOME EFFECTIVE”;
   k. a statement from the Issuer stating that the Issuer is not currently experiencing a Default up to the submission of additional information as referred to in Article 13 paragraph (1);
   l. information regarding the Issuer's financial obligations that will mature within the next 3 (three) months accompanied by details on how to fulfill said financial obligations; and
   m. changes and/or additions to information in the Prospectus in the context of PUB Debt Securities and/or Sukuk (if any).

Article 15
The submission of the notification of the implementation of the last PUB Debt Securities and/or Sukuk along with additional information as referred to in Article 13 paragraph (1) must be submitted to the Financial Services Authority no later than on the second anniversary since the effectiveness of the Registration Statement in the context of PUB Debt Securities and/or Sukuk.

CHAPTER VI
SANCTION PROVISIONS
Article 16
(1) Without prejudice to criminal provisions in the Capital Market sector, the Financial Services Authority has the authority to impose administrative sanctions on any party that violates the provisions of this Financial Services Authority Regulation, including parties who cause the violation to occur, in the form of:
a. written warning; b. fine, i.e., the obligation to pay a certain amount of money;
c. restriction on business activities;
d. suspension of business activities; e. revocation of business license; f. cancellation of approval; and g. cancellation of registration.
(2) Administrative sanctions as referred to in paragraph (1) letter b, letter c, letter d, letter e, letter f, or letter g may be imposed with or without prior imposition of an administrative sanction in the form of a written warning as referred to in paragraph (1) letter a. (3) Administrative sanctions in the form of a fine as referred to in paragraph (1) letter b may be imposed separately or together with the imposition of administrative sanctions as referred to in paragraph (1) letter c, letter d, letter e, letter f, or letter g.

Article 17
In addition to administrative sanctions as referred to in Article 16 paragraph (1), the Financial Services Authority may take certain actions against any party that violates the provisions of this Financial Services Authority Regulation.

Article 18
The Financial Services Authority may announce the imposition of administrative sanctions as referred to in Article 16 paragraph (1) and certain actions as referred to in Article 17 to the public.

CHAPTER VII
CLOSING PROVISIONS
Article 19
Upon the implementation of this Financial Services Authority Regulation, the Decision of the Chairman of the Capital Market Supervisory Agency and Financial Institutions Number: KEP555/BL/2010 dated December 30, 2010 concerning Continuous Offerings together with Regulation Number IX.A.15 which is its attachment is revoked and declared invalid.

Article 20
This Financial Services Authority Regulation shall come into force on the date of its promulgation.

Issued in Jakarta on December 8, 2014
CHAIRMAN OF THE COMMISSIONERS
FINANCIAL SERVICES AUTHORITY,
Signed,
MULIAMAN D. HADAD

STATE GAZETTE OF THE REPUBLIC OF INDONESIA YEAR 2014 NUMBER 378 In order that everyone may know it, it is ordered to promulgate this Financial Services Authority Regulation by placing it in the State Gazette of the Republic of Indonesia. Promulgated in Jakarta on December 8, 2014 MINISTER OF LAW AND HUMAN RIGHTS REPUBLIC OF INDONESIA, Signed, YASONNA H. LAOLY

Copy in accordance with the original
Director of Law 1
Ministry of Law,
Signed.
Tini Kustini

EXPLANATION
OF
FINANCIAL SERVICES AUTHORITY REGULATION
NUMBER 36 /POJK.04/2014
CONCERNING
CONTINUOUS OFFERINGS OF DEBT SECURITIES AND/OR SUKUK

I. GENERAL
Every Public Offering must follow the Public Offering provisions regulated in Law Number 8 of 1995 concerning the Capital Market and its implementing regulations, including legislation in the Capital Market sector regulating Public Offerings. An Issuer may conduct a Public Offering after the Registration Statement becomes effective.

With the increasingly developed Capital Market, the number of Issuers and the value of Securities offered have increased rapidly, especially for Public Offerings of Debt Securities and/or Sukuk. To facilitate the increase in Public Offerings of Debt Securities and/or Sukuk, the Capital Market Supervisory Agency and Financial Institutions, as the Capital Market regulator, issued Regulation Number IX.A.15, Attachment of the Decision of the Chairman of the Capital Market Supervisory Agency and Financial Institutions Number: KEP555/BL/2010 dated December 30, 2010 concerning Continuous Offerings. This provision provides ease for Issuers or Public Companies that meet the requirements to conduct Continuous Public Offerings of Debt Securities and/or Sukuk over a 2 (two) year period by submitting a Registration Statement only once, so that Issuers or Public Companies do not have to submit a Registration Statement every time they intend to issue Debt Securities and/or Sukuk.

In its development, there are several aspects in the aforementioned regulation that still need to be improved to be harmonious with other related regulations and not to cause multi-interpretation in its application, especially regarding the regulation of the obligations of Issuers or Public Companies to meet reporting timeframes to the Financial Services Authority in the event that the planned amount of funds in the Continuous Public Offering period is not achieved and the obligation of Issuers or Public Companies to submit a statement that they are not experiencing a Default condition in the second and subsequent stages when submitting additional information and supporting documents to the Financial Services Authority in the context of the next Continuous Public Offering of Debt Securities and/or Sukuk. Therefore, this Financial Services Authority Regulation improves Regulation Number IX.A.15, Attachment of the Decision of the Chairman of the Capital Market Supervisory Agency and Financial Institutions Number: KEP-555/BL/2010 dated December 30, 2010 concerning Continuous Offerings.

With the improvement of provisions regarding Continuous Offerings through this Financial Services Authority Regulation, it is hoped that it can provide legal certainty and clarification for Issuers or Public Companies in conducting Continuous Offerings of Debt Securities and/or Sukuk.

II. ARTICLE BY ARTICLE
Article 1
Clear enough.

Article 2
Clear enough.

Article 3
Clear enough.

Article 4
Clear enough.

Article 5
“Debt Securities” does not include convertible bonds as convertible bonds fall into the Equity Securities category.
What is meant by the category of the top 4 (four) ratings which are the top 4 (four) best ratings and fall into the investment-grade rating category based on standards owned by the Securities Rating Agency, is the rating owned by the Securities Rating Agency without considering the + (plus) and – (minus) symbols. In practice, the said “investment-grade rating” is also known as investment grade.

Article 6
Clear enough.

Article 7
Clear enough.

Article 8
Letter a
Regulations regarding Registration Statements and Public Offerings existing at the time this Financial Services Authority Regulation comes into force include:

1. Regulation Number IX.A.1, Attachment of the Decision of the Chairman of the Capital Market Supervisory Agency and Financial Institutions Number: KEP-690/BL/2011 dated December 30, 2011 concerning General Provisions for Submission of Registration Statements; and
2. Regulation Number IX.C.1, Attachment of the Decision of the Chairman of the Capital Market Supervisory Agency Number: KEP-42/PM/2000 dated October 27, 2000 concerning Amendment to Regulation Number IX.C.1 Regarding Guidelines on the Form and Content of Registration Statements in the Context of Public Offerings.
   Other related regulations in force at the time this Financial Services Authority Regulation is effective include Regulation Number IX.A.13, Attachment of the Decision of the Chairman of the Capital Market Supervisory Agency and Financial Institutions Number: KEP-181/BL/2009 dated June 30, 2009 concerning the Issuance of Sharia Securities.

Letter b
Number 1
Clear enough.

Number 2
Auditor's statement can be expressed in a comfort letter or other forms.

Article 9
Example of inclusion in the Prospectus and total amount of funds to be raised as well as the type of Security on the outer front cover:
a. “Prospectus for Continuous Public Offering of Debt Securities and Sukuk” amounting to Rp1,000,000,000,000.00, with details of Bonds amounting to Rp700,000,000,000.00 and Sukuk amounting to Rp300,000,000,000.00. “For the first stage, PT. XYZ Bonds amounting to Rp300,000,000,000.00 and PT. XYZ Ijarah Sukuk amounting to Rp50,000,000,000.00 are issued” Example for the next PUB Debt Securities and/or Sukuk:
a.1 “Prospectus for Continuous Public Offering of Debt Securities and Sukuk” amounting to Rp1,000,000,000,000.00, with details of Bonds amounting to Rp700,000,000,000.00 and Sukuk amounting to Rp300,000,000,000.00. “For the second stage, PT. XYZ Bonds amounting to Rp300,000,000,000.00 and PT. XYZ Ijarah Sukuk amounting to Rp100,000,000,000.00 are issued” a.2 “Prospectus for Continuous Public Offering of Debt Securities and Sukuk” amounting to Rp1,000,000,000,000.00, with details of Bonds amounting to Rp700,000,000,000.00 and Sukuk amounting to Rp300,000,000,000.00. “For the third stage, PT. XYZ Bonds amounting to Rp100,000,000,000.00 and PT. XYZ Mudharabah Sukuk amounting to Rp150,000,000,000.00 are issued” b. “Prospectus for Continuous Public Offering of Sukuk” amounting to Rp1,000,000,000,000.00. “For the first stage, PT. PQR Ijarah Sukuk amounting to Rp300,000,000,000.00 is issued” Example for the next PUB Debt Securities and/or Sukuk:
b.1 “Prospectus for Continuous Public Offering of Sukuk” amounting to Rp1,000,000,000,000.00.
“For the second stage, PT. PQR Ijarah Sukuk amounting to Rp200,000,000,000.00 is issued” b.2 “Prospectus for Continuous Public Offering of Sukuk” amounting to Rp1,000,000,000,000.00.
“For the third stage, PT. PQR Mudharabah Sukuk amounting to Rp300,000,000,000.00 is issued” b.3 “Prospectus for Continuous Public Offering of Sukuk” amounting to Rp1,000,000,000,000.00.
“For the fourth stage, PT. PQR Murabahah Sukuk amounting to Rp200,000,000,000.00 is issued”

Article 10
Paragraph (1)
At the time this Financial Services Authority Regulation is in force, the legislation in the Capital Market sector regulating the report on the results of PUB Debt Securities and/or Sukuk in effect is Regulation Number IX.A.2, Attachment of the Decision of the Chairman of the Capital Market Supervisory Agency and Financial Institutions Number: KEP-122/BL/2009 dated May 29, 2009 concerning the Procedure for Registration in the Context of Public Offerings.

Paragraph (2)
At the time of promulgation of this Financial Services Authority Regulation, the legislation in the Capital Market sector regulating the allocation report in effect is Regulation Number IX.A.7, Attachment of the Decision of the Chairman of the Capital Market Supervisory Agency and Financial Institutions Number: KEP-691/BL/2011 dated December 30, 2011 concerning Ordering and Allocation of Securities in Public Offerings.

Article 11
Clear enough.

Article 12
Paragraph (1)
What is meant by “termination of PUB Debt Securities and/or Sukuk” is that the Issuer will not conduct subsequent stages of PUB Debt Securities and/or Sukuk and the PUB Debt Securities and/or Sukuk period is considered ended.

Paragraph (2)
Clear enough.

Article 13
Clear enough.

Article 14
Clear enough.

Article 15
Clear enough.

Article 16
Clear enough.

Article 17
What is meant by “certain actions” can include, among others:
a. postponement of granting effectiveness statements, for example, effectiveness statements for mergers, consolidations; and b. postponement of granting statements from the Financial Services Authority that there are no further responses to documents submitted to the Financial Services Authority in the context of capital increases with Preemptive Rights for Open Public Companies.

Article 18
Clear enough.

Article 19
Clear enough.

Article 20
Clear enough.

SUPPLEMENT TO THE STATE GAZETTE OF THE REPUBLIC OF INDONESIA NUMBER 5648