Financial Services Authority Regulation Number 50/POJK.04/2016 Concerning the Administrator of the Investor Protection Fund

FINANCIAL SERVICES AUTHORITY
REPUBLIC OF INDONESIA
FINANCIAL SERVICES AUTHORITY REGULATION
NUMBER 50 /POJK.04/2016
CONCERNING
THE ADMINISTRATOR OF THE INVESTOR PROTECTION FUND BY THE GRACE OF GOD THE ALMIGHTY THE BOARD OF COMMISSIONERS OF THE FINANCIAL SERVICES AUTHORITY,

Considering:
a. that with the enactment of Law Number 21 of 2011 concerning the Financial Services Authority, since December 31, 2012, the functions, duties, and authority for regulating and supervising financial service activities in the Capital Market sector, including regulations concerning the administrator of the investor protection fund, have transferred from the Capital Market and Financial Institution Supervisory Board to the Financial Services Authority; b. that in order to provide clarity and certainty regarding regulations for the administrator of the investor protection fund, regulations regarding the Investor Protection Fund Administrator 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 the Administrator of the Investor Protection Fund;

COPY

Considering: 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:
Establishes: FINANCIAL SERVICES AUTHORITY REGULATION CONCERNING THE ADMINISTRATOR OF THE INVESTOR PROTECTION FUND.

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

Investor Assets are Securities and other assets related to Securities, and/or investor funds entrusted to a Custodian.
Investor Protection Fund is a collection of funds formed to protect Investors from the loss of Investor Assets, as regulated in the Financial Services Authority Regulation concerning the Investor Protection Fund.
Investor is a customer of a Securities Broker who administers the customer's Securities account and a Custodian Bank.
Custodian is a Party that provides services for the safekeeping of Securities and other assets related to Securities, as well as other services, including receiving dividends, interest, and other rights, settling Securities transactions, and representing account holders who are its customers.
Board of Directors is the organ of the Investor Protection Fund Administrator authorized and fully responsible for the management of the Investor Protection Fund Administrator for the benefit of the Investor Protection Fund Administrator, in accordance with the purpose and objectives of the Investor Protection Fund Administrator, and represents the Investor Protection Fund Administrator, both inside and outside of court, in accordance with the articles of association.
Board of Commissioners is the organ of the Investor Protection Fund Administrator tasked with conducting general and/or specific supervision in accordance with the articles of association and providing advice to the Board of Directors.

CHAPTER II
ADMINISTRATOR OF THE INVESTOR PROTECTION FUND
Section One
Administrator of the Investor Protection Fund
Article 2
Parties that can conduct business activities as the Administrator of the Investor Protection Fund are limited liability companies that have obtained a business license from the Financial Services Authority.

Article 3
The Administrator of the Investor Protection Fund is responsible for the administration and management of the Investor Protection Fund as regulated in the Financial Services Authority Regulation concerning the Investor Protection Fund.

Article 4
In administering and managing the Investor Protection Fund as referred to in Article 3, the Administrator of the Investor Protection Fund is required to:
a. separate the storage, recording, and accounting of the assets of the Administrator of the Investor Protection Fund from the assets of the Investor Protection Fund; b. store Securities for the investment of the Investor Protection Fund at a Custodian Bank as referred to in the Financial Services Authority Regulation concerning the Investor Protection Fund;
c. place cash funds from the Investor Protection Fund in bank accounts and/or storage locations separate from the operational accounts and/or cash storage of the Administrator of the Investor Protection Fund;
d. create and submit reports covering monthly activities and financial positions, semi-annual financial reports, and annual financial reports of the Investor Protection Fund to the Financial Services Authority; and e. provide secure storage for the assets of the Investor Protection Fund.

Article 5
The assets of the Investor Protection Fund are not the assets of the Administrator of the Investor Protection Fund.

Article 6
In administering and managing the Investor Protection Fund as referred to in Article 3, the Administrator of the Investor Protection Fund is authorized to:
a. represent the Investor Protection Fund both inside and outside of court; b. conduct investments in the Investor Protection Fund as referred to in the Financial Services Authority Regulation concerning the Investor Protection Fund, with the aim of optimally increasing the value of the Investor Protection Fund while considering investment returns and risks;
c. collect contributions from members of the Investor Protection Fund as referred to in the Financial Services Authority Regulation concerning the Investor Protection Fund;
d. represent the Investor Protection Fund to carry out efforts to recover or replace funds from the Investor Protection Fund that have been paid to Investors, from the Custodian that caused the loss of the relevant Investor Assets; e. receive and add to the assets of the Investor Protection Fund:

funds obtained by the Investor Protection Fund from the Custodian as compensation for Investors as part of the execution of subrogation rights;
investment returns; and/or
funds and/or assets from other sources determined by the Financial Services Authority;
f. pay costs related to the implementation of Investor Protection Fund activities; g. establish requirements, procedures, or technical guidelines regarding membership, claim handling, and investment policies of the Investor Protection Fund, and other matters related to the duties of the Administrator of the Investor Protection Fund, with the provision that such requirements, procedures, or technical guidelines, including amendments thereto, take effect after obtaining approval from the Financial Services Authority; h. propose to the Financial Services Authority the maximum claim amount for each Investor and/or all Investors in 1 (one) Custodian, considering the recommendations of the claims committee;
i. conduct examinations, verifications, and analyses in order to make decisions to accept or reject Investor claim payments;
j. appoint third parties to assist in the process of examining and verifying Investor claims; k. request the Custodian and Investors to grant power of attorney in order to obtain information and documents required for the verification of Investor claims, while still observing confidentiality provisions as referred to in applicable legislation;
l. make payments and other actions related to Investor claims that have been declared valid for payment; and
m. provide input to the Financial Services Authority regarding protection stages, membership, and coverage of protection based on the capacity of the Investor Protection Fund, considering the capacity and needs of the Investor Protection Fund.

Section Two
Capital and Shareholders
Article 7
(1) The Administrator of the Investor Protection Fund is required to have a basic capital of at least IDR 60,000,000,000.00 (sixty billion Rupiah) and paid-up capital of at least IDR 15,000,000,000.00 (fifteen billion Rupiah). (2) In order to strengthen the capital of the Administrator of the Investor Protection Fund, the Financial Services Authority:
a. may request shareholders of the Administrator of the Investor Protection Fund to increase the capital of the Administrator of the Investor Protection Fund, considering operational needs or the condition of activities of the Investor Protection Fund; and/or b. may grant approval to legal entities in the financial sector or other institutions that meet the requirements determined by the Financial Services Authority to make capital contributions as shareholders in the Administrator of the Investor Protection Fund. (3) The Administrator of the Investor Protection Fund is prohibited from being controlled, directly or indirectly, by individual persons who:
a. have previously committed disgraceful acts and/or have been sentenced for proven criminal offenses in the capital market and financial services sector, both in Indonesia and outside Indonesia; and b. do not have good ethics and morals. (4) At the time of establishment, Parties that can become shareholders of the Administrator of the Investor Protection Fund are Stock Exchanges, Clearing and Guarantee Institutions, and Custody and Settlement Institutions. (5) Shareholders of the Administrator of the Investor Protection Fund are prohibited from having relationships with other shareholders of the same Administrator of the Investor Protection Fund through:
a. direct or indirect ownership of at least 20% (twenty percent) of the shares issued by the Administrator of the Investor Protection Fund, except for ownership by Stock Exchanges, Clearing and Guarantee Institutions, and Custody and Settlement Institutions; b. holding concurrent positions as members of the Board of Commissioners or members of the Board of Directors by members of the Board of Commissioners or members of the Board of Directors of the shareholder, or positions equivalent to such positions; and/or
c. control in the management and/or corporate policy, directly or indirectly, by the same Party.

Section Three
Board of Directors Members and Board of Commissioners Members
Article 8
(1) Members of the Board of Directors and members of the Board of Commissioners of the Administrator of the Investor Protection Fund are required to meet integrity requirements as follows:
a. individual Indonesian citizens; b. legally competent to perform legal acts;
c. have good ethics and morals;
d. have never been declared bankrupt or been a party declared guilty or complicit in causing a legal entity to be declared bankrupt; e. have never been sentenced for committing criminal offenses in the capital market and/or financial services sector, both in Indonesia and outside Indonesia; f. have never committed disgraceful acts in the capital market in particular and the financial sector in general; g. have never committed material violations of regulations in the capital market; h. have a commitment to comply with regulations; and
i. have a commitment to the development of the Investor Protection Fund in particular and the capital market in general.
(2) Members of the Board of Directors and members of the Board of Commissioners of the Administrator of the Investor Protection Fund are required to meet competency and expertise requirements as follows:
a. for Board of Directors members:

have adequate knowledge and expertise in the capital market and/or financial services relevant to their position, with a minimum education level of a Bachelor's degree (Strata 1);
have at least 3 (three) years of experience in the capital market and financial services in managerial positions;
have an understanding of capital market and financial services regulations and broad insight into the capital market and financial services industry; and
understand good corporate governance principles and risk management principles.
b. for Board of Commissioners members:
have adequate knowledge in the capital market and/or financial services or have at least 3 (three) years of experience in institutions or companies operating in the capital market and/or financial services;
have an understanding of capital market and financial services regulations and broad insight into the capital market and financial services industry; and
understand good corporate governance principles and risk management principles.

Article 9
The number of Board of Directors members of the Administrator of the Investor Protection Fund consists of at least 2 (two) Board of Directors members, one of whom is the Chief Executive Officer.

Article 10
The number of Board of Commissioners members of the Administrator of the Investor Protection Fund consists of at least 2 (two) Board of Commissioners members, one of whom is the Chief Commissioner.

Article 11
Every candidate for Board of Directors and Board of Commissioners members of the Administrator of the Investor Protection Fund to be proposed in the General Meeting of Shareholders regarding the appointment of Board of Directors and Board of Commissioners members must first undergo a fitness and propriety assessment conducted by the Financial Services Authority.

Article 12
In conducting the fitness and propriety assessment as referred to in Article 11, the Financial Services Authority may form a committee.

Article 13
The fitness and propriety assessment of candidates for Board of Directors and Board of Commissioners members of the Administrator of the Investor Protection Fund as referred to in Article 11 is conducted at least through administrative research, further clarification through face-to-face meetings (if necessary), and/or presentation requests covering but not limited to strategic plans for the development of the Investor Protection Fund.

Article 14
The term of office for each Board of Directors member is 3 (three) years and may only be reappointed for 1 (one) term of office.

Article 15
The term of office for each Board of Commissioners member is 3 (three) years and may only be reappointed for 1 (one) term of office.

Article 16
Board of Directors members and Board of Commissioners members of the Administrator of the Investor Protection Fund are prohibited from having Affiliation relationships with the management of the Custodian.

Article 17
Board of Directors members and Board of Commissioners members of the Administrator of the Investor Protection Fund are prohibited from owning shares and/or being controllers, directly or indirectly, of the Custodian.

Article 18
Board of Directors members and Board of Commissioners members of the Administrator of the Investor Protection Fund are prohibited from controlling, directly or indirectly, Issuers and/or Public Companies and/or are prohibited from conducting transactions of Issuer or Public Company shares.

Article 19
If at the time Board of Directors and Board of Commissioners members of the Administrator of the Investor Protection Fund are appointed by the General Meeting of Shareholders they already own Issuer or Public Company shares, those shares cannot be traded until 6 (six) months after their term of office ends.

Article 20
Board of Directors members of the Administrator of the Investor Protection Fund are prohibited from holding concurrent positions in any capacity in other companies.

Article 21
Board of Directors members of the Administrator of the Investor Protection Fund are required to reside in Indonesia.

Article 22
One of the Board of Directors members and/or one official one level below the Board of Directors members of the Administrator of the Investor Protection Fund must have an educational background in law.

Article 23
The term of office of Board of Directors members of the Administrator of the Investor Protection Fund ends automatically if the Board of Directors member:
a. loses Indonesian citizenship; b. is no longer legally competent to perform legal acts;
c. is declared bankrupt or has previously been a member of the Board of Commissioners or Board of Directors declared guilty or complicit in causing a company to be declared bankrupt;
d. is sentenced for committing criminal offenses; e. is permanently unable to perform duties; f. passes away; and/or g. the term of office ends.

Article 24
Board of Directors members of the Administrator of the Investor Protection Fund may be dismissed from their position by the Financial Services Authority if the Board of Directors member:
a. does not have good ethics and morals; b. commits disgraceful acts in the capital market in particular and the financial sector in general;
c. commits material violations of regulations in the capital market;
d. does not have a commitment to the development of the Investor Protection Fund; and/or e. fails or is incompetent to perform duties.

Section Four
Licensing Procedures for the Administrator of the Investor Protection Fund
Article 25
Applications for business licenses for the Administrator of the Investor Protection Fund are submitted to the Financial Services Authority in accordance with the format of the Business License Application letter as the Administrator of the Investor Protection Fund as contained in the Appendix which is an integral part of this Financial Services Authority Regulation.

Article 26
The business license application as referred to in Article 25 is accompanied by the following documents:
a. detailed information regarding the applicant, name, address, telephone number, and facsimile; b. photocopy of the deed of establishment certified by the competent authority and the articles of association approved by the competent authority;
c. photocopy of the Taxpayer Identification Number (NPWP);
d. list of names and data of Board of Directors and Board of Commissioners members, including:

signed biographical lists;
photocopy of the highest formal education diploma and/or certificates of expertise in the capital market;
photocopy of valid Identity Cards or Passports;
latest color photographs size 4x6 cm with a red background, 2 (two) sheets; and
photocopy of the Taxpayer Identification Number (NPWP);
e. list of names and data of shareholders, including:
photocopy of the deed of establishment certified by the competent authority and the articles of association approved by the competent authority;
photocopy of the Taxpayer Identification Number (NPWP) for Indonesian legal entities;
information regarding Parties controlling the shareholders, directly or indirectly, including name and form of control;
latest financial report;
list of names and data of Board of Directors, Board of Commissioners, and/or management including:
a) biographical lists; b) photocopy of valid Identity Cards or Passports; and c) latest color photographs size 4x6 cm with a red background, 2 (two) sheets;
latest financial report audited by an Accountant;
photocopy of bank statements;
proof of valid paid-up capital deposit;
statement letters from Board of Commissioners and Board of Directors members stating that the following requirements are met:
a) legally competent to perform legal acts; b) have good ethics and morals; c) have never been declared bankrupt or been a member of the Board of Commissioners or Board of Directors declared guilty causing a company to be declared bankrupt; d) have never been sentenced for committing criminal offenses in the capital market and/or financial services sector, both in Indonesia and outside Indonesia; e) have never committed disgraceful acts in the capital market in particular and the financial sector in general; f) have never committed material violations of regulations in the capital market; g) have a commitment to comply with regulations; and h) have a commitment to the development of the Investor Protection Fund in particular and the capital market in general;
statement letter from Board of Directors members stating that they do not hold concurrent positions in any capacity in other companies;
statement letters from Board of Commissioners and Board of Directors members stating that they have or do not have Affiliation relationships with members of the Board of Commissioners and/or Board of Directors at the Custodian;
information on business premises and photos of office rooms; and
description of operational plans and mission; and
organizational structure and job descriptions of employees.

Article 27
In order to process the business license application for the Administrator of the Investor Protection Fund, the Financial Services Authority may conduct further clarification through face-to-face meetings (if necessary), request presentations, conduct on-site examinations, and/or request additional documents.

Article 28
In the event that the submitted application does not meet the requirements, the Financial Services Authority provides a notification letter to the applicant stating that:
a. the application is incomplete; or b. the application is rejected.

Article 29
In the event that the submitted application meets the requirements, the Financial Services Authority provides a business license letter for the Administrator of the Investor Protection Fund to the applicant.

Section Five
Operations and Internal Control
Article 30
The Administrator of the Investor Protection Fund is required to maintain the confidentiality of data and systems regarding Investors submitting claims, with adequate system security levels.

Article 31
The Administrator of the Investor Protection Fund is required to store all records regarding all matters related to the implementation of its duties and authorities, including all transactions, agreements, accounting records, and internal audit working papers, in accordance with applicable legislation.

Article 32
The Administrator of the Investor Protection Fund is required to prepare financial position reports of the Investor Protection Fund as referred to in Article 4 letter d using generally accepted accounting principles.

Article 33
(1) The Administrator of the Investor Protection Fund is required to have at least the following functions:
a. investment function; b. accounting and finance function; and
c. internal supervision and compliance function.
(2) The investment function is implemented with provisions including at least the following:
a. formulate and implement investment plans for the Investor Protection Fund in accordance with provisions as regulated in the Financial Services Authority Regulation concerning the Investor Protection Fund; b. supervise the development of investments in amounts from the Investor Protection Fund that will not be used immediately; and
c. deposit investment returns from the Investor Protection Fund into the Investor Protection Fund;
(3) The accounting and finance function is implemented with provisions including at least the following:
a. create and maintain records and accounting for all transactions of the Administrator of the Investor Protection Fund in accordance with generally accepted accounting principles; b. create and maintain records and accounting for all transactions and activities related to the Investor Protection Fund in accordance with generally accepted accounting principles, separate from the records and accounting of the Administrator of the Investor Protection Fund;
c. ensure that the records and accounting as referred to in letters a and b are well managed and stored in accordance with legislation;
d. prepare financial reports of the Administrator of the Investor Protection Fund in accordance with generally accepted accounting principles, with the provision that notes to the financial reports must at least contain the following:

expenses related to Affiliated Parties with Board of Directors and Board of Commissioners members of the Administrator of the Investor Protection Fund;
expenditure of costs related to Affiliated Parties with the Investor Protection Fund Administrator;
and
expenditure of costs in the form of salaries, other benefits,
and facilities provided to members of the Board of Directors and members of the Board of Commissioners of the Investor Protection Fund Administrator; e. carrying out treasury activities, namely receiving funds and collecting contributions to the Investor Protection Fund and disbursing costs related to the Investor Protection Fund; f. preparing an annual work plan and budget with reference to the Capital Market efficiency principle in the form of a systematic, accurate, and timely annual work plan and budget; and g. if there is doubt or discrepancy in recordings made by the Investor Protection Fund Administrator with other parties regarding transactions carried out in connection with the Investor Protection Fund, the Investor Protection Fund Administrator is required to conduct reconciliation with the relevant party to ensure accounting accuracy. (4) Internal supervision and compliance functions are carried out under the following provisions:
a. ensuring compliance with applicable laws and regulations, as well as standard operating procedures and codes of ethics of the Investor Protection Fund Administrator; b. processing every complaint from Investors and the public related to the implementation of responsibilities of the Investor Protection Fund Administrator; and
c. ensuring that internal supervision and compliance staff have access to accounting records at all times.

Part Six
Annual Work Plan and Budget
Article 34
The annual work plan and budget of the Investor Protection Fund Administrator must first obtain approval from the Financial Services Authority (Otoritas Jasa Keuangan) before it becomes effective.
Article 35
(1) The annual work plan and budget of the Investor Protection Fund Administrator must be prepared for at least 1 (one) fiscal year starting from January 1 to December 31 of the following year and must contain at least:
a. a work plan detailing at least operational activities and special activities planned to be carried out by the Investor Protection Fund Administrator; b. revenue budget sourced from:

capital deposits from shareholders;
investor protection fund management fees as regulated in the Financial Services Authority Regulation on the Investor Protection Fund; and
other income sources approved by the Financial Services Authority;
c. expense budget prepared based on functions according to the organizational structure of the Investor Protection Fund Administrator;
d. plan for expense expenditures in the form of salaries, other benefits, and facilities from members of the Board of Directors and members of the Board of Commissioners; and e. information regarding material contracts, and contracts between the Investor Protection Fund Administrator and:
Parties affiliated with members of the Board of Directors and members of the Board of Commissioners of the Investor Protection Fund Administrator; and
Parties affiliated with the Investor Protection Fund Administrator.
(2) The annual budget must be presented comparatively with the previous year's budget.
(3) The Investor Protection Fund Administrator is required to submit budget realization reports to the Financial Services Authority through the Board of Commissioners, with the provision that such reports are submitted cumulatively quarterly and received by the Financial Services Authority no later than on the 12th (twelfth) day after the end of the relevant quarter. (4) In the event that the submission deadline for reports to the Financial Services Authority as referred to in paragraph (3) falls on a holiday, the report must be submitted on the next working day.
Part Seven
Investor Protection Fund Reports
Article 36
(1) The Investor Protection Fund Administrator is required to submit to the Financial Services Authority:
a. monthly activity and financial position reports of the Investor Protection Fund no later than on the 15th of the following month; b. interim financial reports of the Investor Protection Fund no later than at the end of the first month after the interim financial report date; and
c. annual financial reports of the Investor Protection Fund audited by an Accountant with a standard opinion no later than at the end of the third month after the annual financial report date.

(2) In the event that the reporting date deadline as referred to in paragraph (1) falls on a holiday, the report must be submitted on the next working day.
Article 37
The Investor Protection Fund Administrator is required to report to the Financial Services Authority any changes related to:
a. detailed information about the Investor Protection Fund Administrator, including name, address, telephone number, and facsimile of the Investor Protection Fund Administrator; b. the Articles of Association of the Investor Protection Fund Administrator;
c. organizational structure and job descriptions of employees up to 1 (one) level below the members of the Board of Directors of the Investor Protection Fund Administrator;
d. procedures and operational standards of the Investor Protection Fund Administrator; e. affiliation status between members of the Board of Commissioners and members of the Board of Directors of the Investor Protection Fund Administrator with other members of the board of commissioners and/or members of the board of directors of the Custodian; and f. reports of material changes affecting the operations of the Investor Protection Fund Administrator, no later than 1 (one) working day after the occurrence.
Article 38
(1) The Investor Protection Fund Administrator is required to report to the Financial Services Authority the following:
a. annual financial reports audited by accountants registered with the Financial Services Authority and annual activity reports signed by members of the Board of Directors and members of the Board of Commissioners of the Investor Protection Fund Administrator, no later than the end of the 3rd (third) month after the date of the annual financial report of the Investor Protection Fund Administrator; b. resignation of members of the Board of Directors and/or members of the Board of Commissioners no later than 2 (two) working days from the date of receipt of the respective resignation letter;
c. results of the General Meeting of Shareholders of the Investor Protection Fund Administrator no later than 2 (two) working days from the date of holding the General Meeting of Shareholders, with the provision that the notarial deed of the General Meeting of Shareholders of the Investor Protection Fund Administrator must be submitted to the Financial Services Authority no later than 2 (two) working days after the deed is received by the Investor Protection Fund Administrator; and
d. information and data used in the claims handling process up to claim payment along with related documents, at any time when requested by the Financial Services Authority. (2) The Financial Services Authority may postpone the resignation of members of the Board of Directors and members of the Board of Commissioners as referred to in paragraph (1) letter b, if such resignation can affect the performance and operations of the Investor Protection Fund Administrator.
Article 39
Plans for changes in shareholders of the Investor Protection Fund Administrator must be submitted to the Financial Services Authority for approval.
Article 40
In order to grant approval or rejection for plans for changes in shareholders as referred to in Article 39, the Financial Services Authority may conduct further clarification through face-to-face meetings (if necessary), request presentations, assess the competence and propriety of prospective shareholders, and/or request additional documents.
Article 41
Plans for changes in the composition of members of the Board of Commissioners and members of the Board of Directors of the Investor Protection Fund Administrator, including the appointment and dismissal of members of the Board of Directors and members of the Board of Commissioners, must be submitted to the Financial Services Authority for approval.
Part Eight
Claims Handling
Article 42
The Investor Protection Fund Administrator carries out claims handling activities for Investors who have lost Investor Assets after the Financial Services Authority declares the existence of conditions as referred to in Article 24 paragraph (1) letter a of the Financial Services Authority Regulation on the Investor Protection Fund.
Article 43
Within a maximum period of 3 (three) working days after receiving the determination from the Financial Services Authority as referred to in Article 42, members of the Board of Directors of the Investor Protection Fund Administrator are required to:
a. announce to the public via newspapers and other media including the website of the Investor Protection Fund Administrator if an event as referred to in Article 24 paragraph (1) letter a of the Financial Services Authority Regulation on the Investor Protection Fund has occurred, and invite relevant Investors to submit claims to the Investor Protection Fund Administrator within a period not exceeding 30 (thirty) working days since the announcement was made; b. propose the formation of a claims committee to the Financial Services Authority; and
c. form a claims verification team.
Article 44
(1) The claims committee consists of at least 7 (seven) members comprising:
a. at least 2 (two) officials of the Financial Services Authority; b. at least 3 (three) representatives of the Stock Exchange, Clearing and Guarantee Institution, and Settlement and Depository Institution;
c. at least 1 (one) member of the Board of Directors of the Investor Protection Fund Administrator; and
d. at least 1 (one) professional in the field of Capital Markets and/or representative of a consumer protection institution.
(2) The composition of the claims committee members must first obtain approval from the Financial Services Authority.
(3) The claims committee has the following duties and functions:
a. supervising and providing guidelines regarding the examination and claims verification process conducted by the verification team formed to handle a specific Investor claim by the Board of Directors of the Investor Protection Fund Administrator; b. providing recommendations to the Board of Directors of the Investor Protection Fund Administrator regarding the acceptance or rejection of claims for loss of Investor Assets submitted by Investors against the Investor Protection Fund, and the payment amount in case the claim is accepted; and
c. proposing to the Board of Directors of the Investor Protection Fund Administrator the maximum proportion of approved claims for each Investor and for each Custodian in the event that Investor Protection Fund assets are insufficient.
(4) Claims handling for Investors is carried out under the following provisions:
a. the Investor submits a written application to the Investor Protection Fund Administrator using a specific form established by the Investor Protection Fund Administrator and attaches documents, data, information, or other evidence as required in the form; b. the submission of the application as referred to in letter a is accompanied by a written statement to transfer all creditor rights of the Investor against the Custodian equal to the value of the lost Investor Assets replaced by the Investor Protection Fund to the Investor Protection Fund;
c. the application as referred to in letter a may be accompanied by granting power of attorney to the Investor Protection Fund Administrator to represent the Investor in seeking compensation for losses of Investor Assets not compensated by the Investor Protection Fund;
d. compensation for losses of Investor Assets obtained by the Investor Protection Fund Administrator from the execution of the power of attorney as referred to in letter c, after deducting costs incurred, must be returned to the Investor; e. the Investor grants power of attorney to the Investor Protection Fund Administrator to obtain information related to the Investor from the Stock Exchange, Clearing and Guarantee Institution, Settlement and Depository Institution, and/or other Parties; f. the verification team examines and verifies investor claims based on documents, data, and other evidence submitted by the investor and other documents/data obtained from the Stock Exchange, Clearing and Guarantee Institution, Settlement and Depository Institution, Custodian, and/or other parties; g. within a period not exceeding 2 (two) months or other time determined by the Financial Services Authority from the deadline when the claim application was submitted and received by the Investor Protection Fund Administrator, the claims verification team reports the results of its examination and verification to the claims committee; h. the verification team's report to the claims committee as referred to in letter g must contain at least information regarding the Investor, the value of lost Investor Assets experienced by each Investor, and the total value of lost Investor Assets on 1 (one) Custodian;
i. the claims committee reviews the results of the examination and verification reports conducted by the claims verification team and formulates recommendations to the Board of Directors of the Investor Protection Fund Administrator regarding the acceptance or rejection of claims submitted by Investors, the compensation amount for each Investor, or the total compensation amount on 1 (one) Custodian; and
j. the Investor Protection Fund Administrator makes compensation payments to the Investor through the account specified by the Investor in the application form.
Article 45
In the event that a claim submitted by an Investor against the Investor Protection Fund is not accepted by the Investor Protection Fund Administrator, the Investor has the right to file an objection against the decision of the Investor Protection Fund Administrator to the Financial Services Authority through the following procedure:
a. the Investor submits an application by filling out the form determined in the technical instructions and guidelines for claims handling and payment issued by the Investor Protection Fund Administrator, attaching documents, data, information, and other evidence as required in the form; b. the application is submitted within a period not exceeding 30 (thirty) days from the date of the notification letter of non-acceptance of the claim by the Investor Protection Fund Administrator; and
c. in the event that the Financial Services Authority determines that the claim can be compensated by the Investor Protection Fund, the Investor Protection Fund Administrator is required within a period not longer than 5 (five) working days since receiving the determination from the Financial Services Authority to make payment to the said Investor according to the amount determined by the Financial Services Authority.
Article 46
The Investor Protection Fund Administrator is required to submit a report on the results of claims handling implementation to the Financial Services Authority, with the provision that the report contains at least information on the number of customers given compensation, total compensation value, remaining Investor Protection Fund, and plans for implementing subrogation rights.
Part Nine
Implementation of Subrogation Rights of the Investor Protection Fund
Article 47
(1) The subrogation rights of the Investor Protection Fund as regulated in the Financial Services Authority Regulation on the Investor Protection Fund are represented by the Investor Protection Fund Administrator. (2) In performing the task of representing the Investor Protection Fund as referred to in paragraph (1), the Investor Protection Fund Administrator is required to take efforts to recover funds from the Investor Protection Fund that have been paid to the Investor. (3) The proceeds from the fund recovery as referred to in paragraph (2), after deducting costs incurred, must be deposited by the Investor Protection Fund Administrator into the Investor Protection Fund.
CHAPTER III
SANCTION PROVISIONS
Article 48
(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 violating the provisions of this Financial Services Authority Regulation, including parties causing the violation, consisting of:
a. written warning; b. fine, which is 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 g. cancellation of registration.

(2) Administrative sanctions as referred to in paragraph (1) letters b, c, d, e, f, or g may be imposed with or without preceding the 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) letters c, d, e, f, or g.
Article 49
In addition to administrative sanctions as referred to in Article 48 paragraph (1), the Financial Services Authority may carry out specific actions against any party violating the provisions of this Financial Services Authority Regulation.
Article 50
The Financial Services Authority may announce the imposition of administrative sanctions as referred to in Article 48 paragraph (1) and specific actions as referred to in Article 49 to the public.
CHAPTER IV
CLOSING PROVISIONS
Article 51
Upon the commencement of this Financial Services Authority Regulation, the Decision of the Chairman of the Capital Market Supervisory Agency and Financial Institutions Number Kep-716/BL/2012 dated December 28, 2012 concerning the Investor Protection Fund Administrator, along with Regulation Number VI.A.5 which is its appendix, is repealed and declared invalid.
Article 52
This Financial Services Authority Regulation comes into effect on the date of its promulgation.
To ensure everyone knows it, ordering the promulgation of this Financial Services Authority Regulation by placing it in the State Gazette of the Republic of Indonesia. Determined in Jakarta on December 2, 2016 CHAIRMAN OF THE BOARD OF COMMISSIONERS FINANCIAL SERVICES AUTHORITY, signature MULIAMAN D. HADAD Promulgated in Jakarta on December 7, 2016 MINISTER OF LAW AND HUMAN RIGHTS REPUBLIC OF INDONESIA, signature YASONNA H. LAOLY STATE GAZETTE OF THE REPUBLIC OF INDONESIA YEAR 2016 NUMBER 279 Copy consistent with the original Legal Director 1 Department of Law sign Yuliana

EXPLANATION
OF
FINANCIAL SERVICES AUTHORITY REGULATION
NUMBER 50 /POJK.04/2016
CONCERNING
THE ADMINISTRATOR OF THE INVESTOR PROTECTION FUND
I. GENERAL
That since December 31, 2012, the functions, tasks, and authorities for regulation and supervision of financial services activities in the Capital Market, Insurance, Pension Funds, Financing Institutions, and Other Financial Service Institutions sectors 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 restructure existing regulations, particularly those related to the Capital Market sector, by converting Capital Market-related regulations of the Capital Market Supervisory Agency and Financial Institutions into Financial Services Authority Regulations. This restructuring is done so that there are Financial Services Authority Regulations regarding the Capital Market sector that are aligned with Financial Services Authority Regulations in other sectors. Based on these background considerations and aspects, it is necessary to replace the legislation in the Capital Market sector regulating the Investor Protection Fund Administrator, namely the Decision of the Chairman of the Capital Market Supervisory Agency and Financial Institutions Number: Kep-716/BL/2012 dated December 28, 2012 concerning the Investor Protection Fund Administrator along with Regulation Number VI.A.5 which is its appendix, into a Financial Services Authority Regulation concerning the Investor Protection Fund Administrator.

II. ARTICLE BY ARTICLE
Article 1
Is clear enough.
Article 2
Is clear enough.
Article 3
Is clear enough.
Article 4
Is clear enough.
Article 5
Is clear enough.
Article 6
Is clear enough.
Article 7
Is clear enough.
Article 8
Paragraph (1)
Is clear enough.
Paragraph (2)
Letter a
Number 1
Is clear enough.
Number 2
Is clear enough.
Number 3
Is clear enough.
Number 4
The principle of good corporate governance referred to is also commonly called good corporate governance, while the risk management principles referred to are also commonly called risk management. Letter b Number 1 Is clear enough. Number 2 Is clear enough. Number 3 The principle of good corporate governance referred to is also commonly called good corporate governance, while the risk management principles referred to are also commonly called risk management.
Article 9
Is clear enough.
Article 10
Is clear enough.
Article 11
Is clear enough.
Article 12
Is clear enough.
Article 13
Is clear enough.
Article 14
Is clear enough.
Article 15
Is clear enough.
Article 16
Is clear enough.

Article 17
Is clear enough.
Article 18
Is clear enough.
Article 19
Is clear enough.
Article 20
Is clear enough.
Article 21
Is clear enough.
Article 22
Is clear enough.
Article 23
Is clear enough.
Article 24
Is clear enough.
Article 25
Is clear enough.
Article 26
Is clear enough.
Article 27
Is clear enough.
Article 28
Is clear enough.

Article 29
Is clear enough.
Article 30
Is clear enough.
Article 31
Is clear enough.
Article 32
Is clear enough.
Article 33
Is clear enough.
Article 34
Is clear enough.
Article 35
Is clear enough.
Article 36
Is clear enough.
Article 37
Is clear enough.
Article 38
Is clear enough.
Article 39
Is clear enough.
Article 40
Is clear enough.

Article 41
Is clear enough.
Article 42
Is clear enough.
Article 43
Is clear enough.
Article 44
Is clear enough.
Article 45
Is clear enough.
Article 46
Is clear enough.
Article 47
Is clear enough.
Article 48
Is clear enough.
Article 49
Is clear enough.
Article 50
Is clear enough.
Article 51
Is clear enough.
Article 52
Is clear enough.
SUPPLEMENT TO THE STATE GAZETTE OF THE REPUBLIC OF INDONESIA NUMBER 5975

FINANCIAL SERVICES AUTHORITY
REPUBLIC OF INDONESIA
APPENDIX
FINANCIAL SERVICES AUTHORITY REGULATION
NUMBER 50 /POJK.04/2016
CONCERNING
THE ADMINISTRATOR OF THE INVESTOR PROTECTION FUND APPLICATION FOR BUSINESS LICENSE AS ADMINISTRATOR OF THE INVESTOR PROTECTION FUND
Number : .................... ........, ................... 20.....
Attachments : ....................
Subject : Application for Business License as
Administrator of the
Investor Protection Fund
TO
Honorable Head of Executive
Capital Market Supervisor
Financial Services Authority in Jakarta
Hereby we apply for a business license as
Administrator of the Investor Protection Fund. As consideration material, we hereby submit the following data:

Applicant Name :...............................................................
Applicant Address :...............................................................
................................................................
(street name and number)
.................................................. -  (city and postal code)
Name of Investor
Protection Fund
Administrator :...............................................................
Tax Identification Number :...............................................................
Capital :...............................................................
a. Authorized Capital :………………………………………………….. b. Paid-up Capital :………………………………………………….
Company Address: ...............................................................
................................................................
(street name and number)
.................................................. -  (city and postal code)
Telephone Number,
Telex, and Fax Number: ...............................................................
Contact Officer: ...............................................................
(include power of attorney)
Business Licenses Already Held by the Company: ...............................................................
To complete this application, we hereby attach the following documents:
detailed information regarding the applicant, name, address, telephone number,
fax number;
photocopy of the deed of establishment certified by the competent authority
and the articles of association approved by the competent authority;
photocopy of the Taxpayer Identification Number (NPWP);
list of names and members of the Board of Directors and Board of Commissioners, including:
a. signed biographical lists; b. photocopy of the highest formal education diploma and/or certificates of expertise in the Capital Market field;
c. photocopy of the valid Identity Card (KTP) or Passport;
d. latest color passport-sized photos, 4x6 cm, with a red background, 2 (two) sheets; and e. photocopy of the Taxpayer Identification Number (NPWP); To...
list of names and data of shareholders, including:
a. photocopy of the deed of establishment certified by the competent authority and the articles of association approved by the competent authority; b. photocopy of the Taxpayer Identification Number (NPWP) for Indonesian legal entities;
c. information regarding Parties controlling the shareholders, both directly and indirectly, including among others the name and form of control;
d. latest financial statements; e. list of names and data of members of the Board of Directors, members of the Board of Commissioners, and/or management including:

biographical lists;
photocopy of valid Identity Cards or Passports; and
latest color passport-sized photos, 4x6 cm, with a red background, 2 (two) sheets.

latest financial statements audited by an Accountant;
photocopy of bank statements;
proof of valid deposit of paid-up capital;
statement letter from the Board of Commissioners and members of the Board of Directors stating that the following requirements are met:
a. have the legal capacity to perform legal acts; b. have good character and morality;
c. have never been declared bankrupt or served as a member of the Board of Commissioners or Board of Directors who was found guilty causing a company to be declared bankrupt;
d. have never been sentenced for committing criminal offenses;

e. have never committed disgraceful acts in the Capital Market field in particular and the financial field in general; f. have never committed material violations of laws and regulations in the Capital Market field; g. have a commitment to comply with laws and regulations; and h. have a commitment to the development of the Investor Protection Fund in particular and the Capital Market in general;
10. statement letter from prospective Board of Directors members stating that they do not hold concurrent positions in any other company;
11. statement letter from members of the Board of Commissioners or Board of Directors stating that they have or do not have an Affiliation relationship with members of the Board of Commissioners or Board of Directors of the Custodian;
12. information on business premises and photos of the office room;
13. overview of operational plans and mission; and
14. organizational structure and job descriptions of employees.
Thus, we submit this application and thank you for your attention.
Applicant,
.............................................
(clear name and signature) stamp

STATEMENT LETTER OF CONTROLLING SHAREHOLDER/POTENTIAL CONTROLLING SHAREHOLDER/SHAREHOLDER/POTENTIAL SHAREHOLDER The undersigned:
Name : ........................................................................
Full Address : .....................................................................
......................................................................
(Street Name & Number)
................................... -
(City & Postal Code) as controlling shareholder/shareholder/potential controlling shareholder/potential shareholder *) of PT .................. hereby states that I:
a. have/have not committed disgraceful acts and/or been sentenced for proven criminal offenses in the Capital Market and financial services field, both in Indonesia and abroad; and b. have/have not good character and morality. This statement is made truthfully so that it may be used as appropriate.
.........., ......................20.....
(place and date)
Applicant,
.............................................
(clear name and signature)
*) strike out what is not necessary stamp

STATEMENT LETTER OF BOARD OF DIRECTORS MEMBER/BOARD OF COMMISSIONERS MEMBER/POTENTIAL BOARD OF DIRECTORS MEMBER/POTENTIAL BOARD OF COMMISSIONERS MEMBER The undersigned:
Name : ........................................................................
Full Address : .....................................................................
......................................................................
(Street Name & Number)
................................... -
(City & Postal Code)
as member of the Board of Directors/member of the Board of Commissioners/potential member of the Board of Directors/potential member of the Board of Commissioners*) of PT .........................................
hereby states that I:
a. am capable/are not capable of performing legal acts; b. have good character and morality;
c. have never been declared bankrupt or served as a member of the Board of Commissioners or Board of Directors who was found guilty causing a company to be declared bankrupt;
d. have never been sentenced for committing criminal offenses in the Capital Market and financial services field, both in Indonesia and abroad; e. have never committed disgraceful acts in the Capital Market field in particular and the financial field in general; f. have never committed material violations of laws and regulations in the Capital Market field; g. have a commitment to comply with laws and regulations; and

h. have a commitment to the development of the Investor Protection Fund in particular and the Capital Market in general.
This statement is made truthfully so that it may be used as appropriate.
.........., ......................20.....
(place and date)
Applicant,
.............................................
(clear name and signature)
*) strike out what is not necessary stamp

STATEMENT LETTER OF NO CONCURRENT POSITIONS
FOR BOARD OF DIRECTORS MEMBERS/POTENTIAL BOARD OF DIRECTORS MEMBERS The undersigned:
Name : ..........................................................................
Full Address : .....................................................................
......................................................................
(Street Name & Number)
................................... -
(City & Postal Code)
as member of the Board of Directors/potential member of the Board of Directors *) of PT ..............................
which is located at ........................... hereby states truthfully that I do not hold concurrent positions as a director and/or any position in other companies. This statement is made truthfully so that it may be used as appropriate.
.........., ......................20.....
(place and date)
Applicant,
.............................................
(clear name and signature)
*) strike out what is not necessary stamp

STATEMENT LETTER OF NO FAMILY RELATIONSHIP
WITH OTHER BOARD OF DIRECTORS MEMBERS AND BOARD OF COMMISSIONERS MEMBERS IN THE RELEVANT INVESTOR PROTECTION FUND MANAGER The undersigned:
Name : ..........................................................................
Full Address : .....................................................................
......................................................................
(Street Name & Number)
................................... -
(City & Postal Code) as member of the Board of Directors/potential member of the Board of Directors or member of the Board of Commissioners/potential member of the Board of Commissioners *) of PT .............................. which is located at ........................... hereby states truthfully that I have or do not have *) family relationship up to the second degree with other members of the Board of Directors and members of the Board of Commissioners in the relevant Investor Protection Fund Manager. This statement is made truthfully so that it may be used as appropriate.
.........., ......................20.....
(place and date)
.............................................
(clear name and signature)
*) strike out what is not necessary stamp

STATEMENT LETTER OF NO FAMILY RELATIONSHIP
WITH SERVICE USERS OF THE COMPANY
The undersigned:
Name : ..........................................................................
Full Address : .....................................................................
......................................................................
(Street Name & Number)
................................... -
(City & Postal Code)
as member of the Board of Directors/potential member of the Board of Directors or member of the Board of Commissioners/potential member of the Board of Commissioners *) of PT ..............................
which is located at ........................... hereby states truthfully that I have or do not have *) family relationship up to the second degree with Parties who are service users of the company. This statement is made truthfully so that it may be used as appropriate.
.........., ......................20.....
(place and date)
Applicant,
.............................................
(clear name and signature)
*) strike out what is not necessary stamp

QUESTIONNAIRE
I. INSTRUCTIONS FOR ANSWERING QUESTIONS

All questions must be answered by each member of the Board of Directors, member of the Board of Commissioners, controlling shareholder/shareholder, potential member of the Board of Directors, potential member of the Board of Commissioners, and/or potential controlling shareholder/shareholder.
Signed by members of the Board of Directors, members of the Board of Commissioners, controlling shareholders/shareholders, potential members of the Board of Directors, potential members of the Board of Commissioners, and/or potential controlling shareholders/shareholders on stamped paper (on sealed paper).
Place a checkmark  in the box in front of the word "Yes" if your answer is "Yes", or place a checkmark  in the box in front of the word "No" if the answer to the following question is "No".
For every "Yes" answer, a detailed and clear answer is required which includes among others:
a. The institutions involved; b. The cases and dates of the actions taken;
c. The court or institution that took the action; and
d. The actions and sanctions imposed.
II. INTEGRITY OF CONTROLLING SHAREHOLDERS/SHAREHOLDERS OR MEMBERS OF THE BOARD OF DIRECTORS AND BOARD OF COMMISSIONERS
Definitions
Investment is an activity involving Securities, banking, insurance, or housing or real estate businesses, including activities, both direct and indirect, related to Bond Valuation Institutions, Stock Exchanges, Investment Advisors, Banks, or other companies engaged in the financial sector. Answer the following questions:
In the last 10 (ten) years, have you been convicted, pleaded guilty, or not contested charges of:

a. Criminal offenses or crimes involving Investment or Investment-Related businesses, fraud, false statements, or embezzlement, bribery, forgery, or extortion?  yes  no b. Or other crimes?  yes  no
2. Has the court:
a. Ever declared you bankrupt?
 yes  no b. In the last ten years, prohibited you from engaging in activities related to investment?
 yes  no
c. Ever found that you caused a business related to investment, its business license, or license to conduct business to be rejected, frozen, revoked, or restricted?
 yes  no
3. Has the Financial Services Authority (OJK) ever:
a. Found you making false statements or being negligent?
 yes  no b. Found you involved in violations of laws and regulations in the Capital Market field?
 yes  no
c. Found you causing your business license or license to conduct business related to investment to be rejected, frozen, revoked, or restricted?
 yes  no

d. Ordered the rejection, temporary suspension, or revocation of your business license, imposing sanctions by restricting your activities?
 yes  no
4. Have other competent authorities ever:
a. Found you making false, misleading, dishonest, unfair, or unethical statements?
 yes  no b. Found you involved in violations of regulations in the investment field or other laws and regulations?
 yes  no
5. Has a Stock Exchange ever:
a. Found you making false statements or failing to provide information that should have been provided?
 yes  no b. Found you involved in violations of Stock Exchange regulations?
 yes  no
c. Found you causing the business license or license to conduct business of a company related to investment to be frozen, revoked, or restricted?
 yes  no d. Taken disciplinary action against you by issuing or freezing membership, preventing or freezing your relationship with other members, or restricting your activities?  yes  no
6. Has a court in another country, applicable regulation, or Stock Exchange ordered action to be taken against you in connection with fraud?
 yes  no

Are you currently facing a court case?
 yes  no
Has an insurance company ever refused to pay you or cancelled your insurance?
 yes  no
Do you have obligations based on court decisions or other agreements made with other parties that cannot be fulfilled?
 yes  no
Have you ever been a director of an Investor Protection Fund Manager, Investment Advisor, or controller of an Investor Protection Fund Manager that was declared bankrupt?
 yes  no
Do you individually or jointly own shares exceeding 5% (five percent) in an Issuer or Public Company or 20% (twenty percent) in a company engaged in Investment?
 yes  no
.............................., ..............
(Place and date)
Potential Board of Directors Member/Potential Board of Commissioners Member/Potential Controlling Shareholder/Potential Shareholder, Board of Directors Member/ Board of Commissioners Member/Controlling Shareholder/ Shareholder *)
.............................................
(clear name)
*) strike out what is not necessary stamp

List A and B.
List A:

Provide information regarding owners/shareholders, members of the Board of Commissioners, and officials using the table below. If additional explanation is needed, use List C.
a. Officials are members of the Board of Directors or officials one level below the Board of Directors and parties who have the same position or function.
b. Owners are shareholders or beneficial owners of 5% (five percent) or more of the applicant's shares.
Also report changes in members of the Board of Commissioners, officials, shareholders, and beneficial owners, including the date the new party started and the date the party left their previous position in the relevant company using the table below:
List of Board of Commissioners Members, Officials, and Shareholders Full Name Start Date Month Year End Date Month Year Position Ownership Percentage Taxpayer ID (NPWP) Nationality

List B:
Filled with detailed explanations for "Yes" answers to questions number 1 through 11 and further explanations from List A and B.
Explanation List for Questions Number 1 to 11
No. Question Number/List Explanation
Established in Jakarta on December 2, 2016
CHAIRMAN OF THE COMMISSIONERS BOARD
FINANCIAL SERVICES AUTHORITY, signed
MULIAMAN D. HADAD
Copy matches the original
Legal Director 1
Legal Department
Yuliana

Financial Services Authority Regulation Number 50/POJK.04/2016 Concerning the Administrator of the Investor Protection Fund

Lineage: In force