FINANCIAL SERVICES AUTHORITY

REPUBLIC OF INDONESIA

COPY

FINANCIAL SERVICES AUTHORITY REGULATION

REPUBLIC OF INDONESIA

NUMBER 49 /POJK.04/2020

CONCERNING

CREDIT BOND AND/OR SUKUK RATING

BY THE GRACE OF GOD ALMIGHTY

THE COMMISSIONERS OF THE FINANCIAL SERVICES AUTHORITY,

Considering :

a. that with the shift of functions, duties, and authority for the regulation and supervision of financial services activities in the capital market sector, including regulations concerning credit bond and/or Sukuk rating, from the Capital Market Supervisory Agency and Financial Institutions to the Financial Services Authority;

b. that in order to provide clarity and certainty regarding credit bond and/or Sukuk rating, existing statutory regulations in the capital market sector concerning credit bond and/or Sukuk rating issued prior to the establishment of the Financial Services Authority need to be changed into a Financial Services Authority Regulation;

c. that based on the considerations as referred to in letters a and b, it is necessary to establish a Financial Services Authority Regulation concerning Credit Bond and/or Sukuk Rating;

Considering :

1. Law Number 8 of 1995 concerning Capital Markets (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:

Establishing: FINANCIAL SERVICES AUTHORITY REGULATION CONCERNING CREDIT BOND AND/OR SUKUK RATING.

CHAPTER I

GENERAL PROVISIONS

Article 1

In this Financial Services Authority Regulation, the following terms are defined as:

1. Securities are negotiable instruments, namely debt acknowledgment instruments, commercial paper, shares, bonds, debt certificates, investment contract unit participations, derivative contracts over Securities, and any derivatives of Securities.

2. Sukuk are Sharia-compliant Securities in the form of certificates or proof of ownership that have equal value and represent an inseparable or undivided (syuyu’/undivided share) portion of the underlying assets.

3. Credit Bond and/or Sukuk Rating is an opinion regarding the ability to fulfill payment obligations on time by the issuer concerning Credit Bonds and/or Sukuk.

4. Annual Rating is the Credit Bond and/or Sukuk Rating issued by a Credit Rating Agency as part of an annual review.

5. Credit Rating Agency is an investment advisor in the form of a limited liability company that conducts rating activities and provides ratings.

6. Classification of Credit Bonds and/or Sukuk is the classification based on the issuance time and series of Credit Bonds and/or Sukuk.

7. Public Offering is the activity of offering Securities conducted by the Issuer to sell Securities to the public based on procedures regulated in Law Number 8 of 1995 concerning Capital Markets and its implementing regulations.

8. Issuer is the party conducting the Public Offering.

9. Trust Agreement is an agreement between the Issuer and the Trustee in the context of issuing Credit Bonds and/or Sukuk.

10. Prospectus is any written information related to the Public Offering with the aim for other parties to purchase Securities.

11. Stock Exchange is the party that organizes and provides systems and/or facilities to match buy and sell offers of other parties with the aim of trading Securities among them.

12. Continuous Public Offering of Credit Bonds and/or Sukuk, hereinafter referred to as PUB Credit Bonds and/or Sukuk, is the activity of offering Credit Bonds and/or Sukuk conducted in stages.

13. Website is a collection of web pages containing information or data that can be accessed through an internet network system.

Article 2

The regulations in this Financial Services Authority Regulation apply to the obligation to rate Credit Bonds and/or Sukuk that have a maturity of more than 1 (one) year, including Credit Bonds that can be converted into shares, issued by the Issuer through a Public Offering.

CHAPTER II

RATING IN THE CONTEXT OF PUBLIC OFFERING OF CREDIT BONDS AND/OR SUKUK

Article 3

(1) An Issuer intending to issue Credit Bonds and/or Sukuk through a Public Offering must:

a. obtain Credit Bond and/or Sukuk Rating for each Classification of Credit Bonds and/or Sukuk from a Credit Rating Agency; and

b. include the Credit Bond and/or Sukuk Rating and the rating issuance date in the Trust Agreement and Prospectus.

(2) The Credit Bond and/or Sukuk Rating for each Classification of Credit Bonds and/or Sukuk as referred to in paragraph (1) letter a must contain at least the following information:

a. advantages or strengths of the Issuer and Credit Bonds and/or Sukuk and their relation to the Issuer's ability to fulfill obligations regarding Credit Bonds and/or Sukuk;

b. weaknesses of the Issuer and Credit Bonds and/or Sukuk and their relation to the risks faced by holders of Credit Bonds and/or Sukuk;

c. Credit Bond and/or Sukuk Rating symbol reflecting the information as referred to in letters a and b;

d. validity period of the Credit Bond and/or Sukuk Rating, which is 1 (one) year after the rating is issued; and

e. outlook.

(3) In the event that Credit Bond and/or Sukuk Ratings as referred to in paragraph (1) letter b are obtained from more than 1 (one) Credit Rating Agency, each of these ratings must be included in the Trust Agreement and Prospectus.

Article 4

The time period between the date of the Credit Bond and/or Sukuk rating result and the effective date of the registration statement in the context of the Public Offering of Credit Bonds and/or Sukuk is at most 6 (six) months.

CHAPTER III

ANNUAL RATING

Article 5

The Issuer is obligated to submit the Annual Rating for each Classification of Credit Bonds and/or Sukuk to the Financial Services Authority at the latest 10 (ten) working days after the expiration of the last rating period until the Issuer has completed all obligations related to the issued Credit Bonds and/or Sukuk.

Article 6

In the event that Credit Bond and/or Sukuk Ratings are obtained from more than 1 (one) Credit Rating Agency during the Public Offering, the Issuer may appoint one of these Credit Rating Agencies to conduct annual ratings until the completion of all Issuer obligations related to the issued Credit Bonds and/or Sukuk, provided this is regulated in the Trust Agreement.

Article 7

(1) In the event that the obtained Credit Bond and/or Sukuk Rating differs from the previous rating, the Issuer is obligated to announce this to the public at the latest 10 (ten) working days after the expiration of the last rating period.

(2) The announcement as referred to in paragraph (1) must contain at least:

a. the obtained Annual Rating; and

b. a brief explanation regarding the reasons for the rating change.

Article 8

In the event that Annual Ratings are obtained from more than 1 (one) Credit Rating Agency, the submission and/or announcement of all Credit Bond and/or Sukuk Ratings must be carried out in accordance with the provisions as referred to in Article 5 and Article 7.

CHAPTER IV

RATING DUE TO MATERIAL FACTS OR IMPORTANT EVENTS

Article 9

(1) In the event that a Credit Rating Agency issues a rating different from the previous one due to material facts or important events, the Issuer is obligated to submit this to the Financial Services Authority and announce it to the public at the latest 2 (two) working days after receiving the rating different from the previous one.

(2) The announcement as referred to in paragraph (1) must contain at least:

a. the rating different from the previous one; and

b. a brief explanation regarding the factors causing the issuance of the rating different from the previous one.

Article 10

In the event that the rating as referred to in Article 9 paragraph (1) is obtained from more than 1 (one) Credit Rating Agency, the submission and/or announcement of all Credit Bond and/or Sukuk Ratings must be carried out in accordance with the provisions as referred to in Article 9.

Article 11

The rating different from the previous one as referred to in Article 9 paragraph (1) remains valid until the end of the Annual Rating period.

CHAPTER V

RATING OF CREDIT BONDS AND/OR SUKUK IN CONTINUOUS PUBLIC OFFERING

Article 12

An Issuer issuing Credit Bonds and/or Sukuk through PUB Credit Bonds and/or Sukuk as regulated in the Financial Services Authority Regulation concerning PUB Credit Bonds and/or Sukuk must obtain Credit Bond and/or Sukuk Rating covering the total value of the planned PUB Credit Bonds and/or Sukuk.

Article 13

Annual Ratings and ratings issued by Credit Rating Agencies due to material facts, important events, or other factors different from previous ratings must cover the total value of PUB Credit Bonds and/or Sukuk, provided that:

a. the PUB Credit Bonds and/or Sukuk period is still valid; and

b. the Issuer is not in a condition prohibited from executing the next stage of the Credit Bonds and/or Sukuk offering in the PUB Credit Bonds and/or Sukuk period as regulated in the Financial Services Authority Regulation concerning PUB Credit Bonds and/or Sukuk.

CHAPTER VI

RE-RATING

Article 14

In the event that the Issuer receives a re-rating result from the Credit Rating Agency regarding Credit Bond and/or Sukuk Ratings other than those referred to in Article 5 and Article 9, the Issuer is obligated to submit the re-rating result to the Financial Services Authority at the latest 2 (two) working days after receiving the said rating.

Article 15

In the event that the received rating as referred to in Article 14 is a rating different from the previous one, the Issuer is obligated to announce this to the public at the latest 2 (two) working days after receiving the said rating.

CHAPTER VII

ISSUERS NO LONGER HAVING CREDIT BOND AND/OR SUKUK RATING

Article 16

In the event that the Issuer no longer has a Credit Bond and/or Sukuk Rating, the Issuer is obligated to:

a. submit information to the Financial Services Authority and announce it to the public at the latest 2 (two) working days after the occurrence of such event; and

b. obtain a rating at the latest 30 (thirty) working days since the Issuer no longer has a rating.

Article 17

(1) The Issuer is obligated to submit the obtained rating as referred to in Article 16 letter b to the Financial Services Authority and announce it to the public at the latest 2 (two) working days after receiving the said rating.

(2) The announcement as referred to in paragraph (1) must contain at least the information as referred to in Article 3 paragraph (2).

CHAPTER VIII

ANNOUNCEMENT MEDIA

Article 18

(1) Announcements as referred to in Article 7, Article 8, Article 9, Article 10, Article 15, Article 16 letter a, and Article 17 for Issuers whose shares are listed on a Stock Exchange must be conducted through at least:

a. the Issuer's Website; and

b. the Stock Exchange's Website.

(2) Announcements as referred to in Article 7, Article 8, Article 9, Article 10, Article 15, Article 16 letter a, and Article 17 for Issuers whose shares are not listed on a Stock Exchange must be conducted through at least:

a. the Issuer's Website; and

b. 1 (one) daily newspaper in the Indonesian language with national circulation or a Website provided by the Financial Services Authority.

(3) Proof of announcement in the newspaper as referred to in paragraph (2) letter b must be submitted to the Financial Services Authority at the latest 2 (two) working days after the date of such announcement.

Article 19

The implementation of announcement regulations through the Website provided by the Financial Services Authority for announcements related to Credit Bond and/or Sukuk Ratings as referred to in Article 18 paragraph (2) letter b is established by the Financial Services Authority.

CHAPTER IX

OTHER PROVISIONS

Article 20

All obligations in this Financial Services Authority Regulation remain valid until the Issuer has completed all obligations related to the issued Credit Bonds and/or Sukuk.

Article 21

In the event that the Issuer obtains a default rating, the rating obligation for Credit Bonds and/or Sukuk does not apply until there is development indicating the Issuer's ability to fulfill Credit Bonds and/or Sukuk obligations.

CHAPTER X

ADMINISTRATIVE SANCTIONS

Article 22

(1) Any party violating the provisions as referred to in Article 3 paragraph (3), Article 5, Article 7, Article 8, Article 9, Article 10, Article 12, Article 13, Article 14, Article 15, Article 16, Article 17, and Article 18 shall be subject to administrative sanctions.

(2) Sanctions as referred to in paragraph (1) are also imposed on parties causing the violation as referred to in paragraph (1).

(3) Sanctions as referred to in paragraph (1) and paragraph (2) are imposed by the Financial Services Authority.

(4) Administrative sanctions as referred to in paragraph (1) consist of:

a. written warning;

b. fine, namely the obligation to pay a certain amount of money;

c. restriction of business activities;

d. suspension of business activities;

e. revocation of business license;

f. cancellation of approval; and/or

g. cancellation of registration.

(5) Administrative sanctions as referred to in paragraph (4) letters b, c, d, e, f, or g may be imposed with or without prior imposition of administrative sanctions in the form of a written warning as referred to in paragraph (4) letter a.

(6) Administrative sanctions in the form of a fine as referred to in paragraph (4) letter b may be imposed separately or together with the imposition of administrative sanctions as referred to in paragraph (4) letters c, d, e, f, or g.

(7) The procedure for imposing sanctions as referred to in paragraph (3) is carried out in accordance with statutory regulations.

Article 23

In addition to administrative sanctions as referred to in Article 22 paragraph (4), the Financial Services Authority may take specific actions against any party violating the provisions of this Financial Services Authority Regulation.

Article 24

The Financial Services Authority may announce the imposition of administrative sanctions as referred to in Article 22 paragraph (4) and specific actions as referred to in Article 23 to the public.

CHAPTER XI

CLOSING PROVISIONS

Article 25

Upon the implementation of this Financial Services Authority Regulation, the Decision of the Head of the Capital Market Supervisory Agency and Financial Institutions Number Kep-712/BL/2012 concerning Credit Bond and/or Sukuk Rating, along with Regulation Number IX.C.11 which is its attachment, is revoked and declared invalid.

Article 26

This Financial Services Authority Regulation comes into force on the date of enactment.

This copy is consistent with the original

Legal Director 1

Legal Department

signed

Mufli Asmawidjaja

In order that everyone may know it, ordering the enactment of this Financial Services Authority Regulation by placing it in the State Gazette of the Republic of Indonesia.

Established in Jakarta

on December 3, 2020

CHAIRMAN OF THE COMMISSIONERS

FINANCIAL SERVICES AUTHORITY

REPUBLIC OF INDONESIA,

signed

WIMBOH SANTOSO

Enacted in Jakarta

on December 11, 2020

MINISTER OF LAW AND HUMAN RIGHTS

REPUBLIC OF INDONESIA,

signed

YASONNA H. LAOLY

STATE GAZETTE OF THE REPUBLIC OF INDONESIA YEAR 2020 NUMBER 273

EXPLANATION

OF

FINANCIAL SERVICES AUTHORITY REGULATION

REPUBLIC OF INDONESIA

NUMBER 49 /POJK.04/2020

CONCERNING

CREDIT BOND AND/OR SUKUK RATING

I. GENERAL

That since December 31, 2012, the functions, duties, and authority for the regulation and supervision of financial services activities in the capital market, insurance, pension funds, financing institutions, and other financial service institutions have shifted from the Minister of Finance and the Capital Market Supervisory Agency and Financial Institutions to the Financial Services Authority.

In light of the above, it is necessary to reorganize the existing regulatory structure, particularly those related to the capital market sector, by converting Capital Market Supervisory Agency regulations related to the capital market sector into Financial Services Authority Regulations. This reorganization is conducted so that Financial Services Authority regulations related to the capital market sector are aligned with Financial Services Authority regulations in other sectors.

Based on the background and aspects mentioned above, it is necessary to replace statutory regulations in the capital market sector regulating credit bond and/or Sukuk rating, namely the Decision of the Head of the Capital Market Supervisory Agency and Financial Institutions Number Kep-712/BL/2012 concerning Credit Bond and/or Sukuk Rating, along with Regulation Number IX.C.11 which is its attachment, into a Financial Services Authority Regulation concerning Credit Bond and/or Sukuk Rating.

II. ARTICLE BY ARTICLE

Article 1

Clear enough.

Article 2

Clear enough.

Article 3

Paragraph (1)

Clear enough.

Paragraph (2)

Letter a

Clear enough.

Letter b

Clear enough.

Letter c

Clear enough.

Letter d

Clear enough.

Letter e

In practice, the term "outlook" is also known as "prospectus".

Paragraph (3)

Clear enough.

Article 4

Clear enough.

Article 5

Clear enough.

Article 6

Clear enough.

Article 7

Clear enough.

Article 8

Clear enough.

Article 9

Clear enough.

Article 10

Clear enough.

Article 11

Clear enough.

Article 12

Clear enough.

Article 13

Letter a

Example:

In the event that the total value of the planned PUB Credit Bonds and/or Sukuk X is Rp1 Trillion, then the Annual Rating and ratings conducted by the Credit Rating Agency due to material facts, important events, or other factors different from previous ratings cover the total value of PUB Credit Bonds and/or Sukuk valued at Rp1 Trillion.

Letter b

Example:

In the event that the total value of the planned PUB Credit Bonds and/or Sukuk X is Rp1 Trillion, but before the PUB Credit Bonds and/or Sukuk X is conducted, the Issuer is in a condition prohibited from executing the next stage of the Credit Bonds and/or Sukuk offering as regulated in the Financial Services Authority Regulation concerning PUB Credit Bonds and/or Sukuk, then the Annual Rating and ratings conducted by the Credit Rating Agency due to material facts, important events, or other factors different from previous ratings cover the total value of Credit Bonds and/or Sukuk that have already been issued.

Article 14

Example:

PT ABC has issued Credit Bonds and/or Sukuk ABC I. When PT ABC plans to issue Credit Bonds and/or Sukuk ABC II, in the event that the Credit Rating Agency, in conducting ratings for Credit Bonds and/or Sukuk ABC II, also conducts a re-rating of Credit Bonds and/or Sukuk ABC I, then the re-rating result of Credit Bonds and/or Sukuk ABC I must be submitted to the Financial Services Authority at the latest 2 (two) working days after receiving the said rating.

Article 15

Clear enough.

Article 16

Example of events causing the Issuer to no longer have a Credit Bond and/or Sukuk Rating, such as the rating being withdrawn by the Credit Rating Agency.

Article 17

Clear enough.

Article 18

Clear enough.

Article 19

Clear enough.

Article 20

Clear enough.

Article 21

Clear enough.

Article 22

Clear enough.

Article 23

The term "specific actions" includes, among others, the postponement of the issuance of the effective statement of the Registration Statement in the context of the Public Offering.

Article 24

Clear enough.

Article 25

Clear enough.

Article 26

Clear enough.

SUPPLEMENT TO THE STATE GAZETTE OF THE REPUBLIC OF INDONESIA NUMBER 6586