Financial Services Authority Regulation Number 7/POJK.04/2019 on Securities Marketing Promotion Including Advertising, Brochures, or Other Communications to the Public

COPY
FINANCIAL SERVICES AUTHORITY REGULATION
OF THE REPUBLIC OF INDONESIA
NUMBER 7/POJK.04/2019
ON
SECURITIES MARKETING PROMOTION INCLUDING ADVERTISING, BROCHURES, OR OTHER COMMUNICATIONS TO THE PUBLIC 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 the regulation and supervision of financial services activities in the capital market sector, including regulation regarding securities marketing promotion including advertising, brochures, or other communication tools to the public, have shifted from the Capital Market and Financial Institution Supervisory Board to the Financial Services Authority; b. that to provide clarity and certainty regarding regulation on securities marketing promotion including advertising, brochures, or other communication tools to the public, existing capital market sector regulations regarding securities marketing promotion including advertising, brochures, or other communication tools to the public 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 Securities Marketing Promotion including Advertising, Brochures, or Other Communication Tools to the Public;
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);
   DECIDING:
   To Establish: FINANCIAL SERVICES AUTHORITY REGULATION CONCERNING SECURITIES MARKETING PROMOTION INCLUDING ADVERTISING, BROCHURES, OR OTHER COMMUNICATIONS TO THE PUBLIC.

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

1. Securities are securities, namely debt acknowledgment instruments, commercial paper, shares, bonds, debt certificates, units of participation in collective investment contracts, futures contracts on Securities, and any derivatives of Securities.
2. Public Offering is the activity of offering Securities conducted by an Issuer to sell Securities to the public in accordance with the procedures regulated in Law Number 8 of 1995 concerning the Capital Market and its implementing regulations.
3. Party means an individual, company, joint venture, association, or organized group.
4. Issuer means a Party conducting a Public Offering.
5. Securities Company means a Party conducting business activities as an underwriter of Securities, securities broker-dealer, and/or investment manager.
6. Prospectus is any written information related to a Public Offering with the aim for other Parties to purchase the Issuer's Securities.
7. Initial Prospectus is a written document containing all information in the Prospectus submitted to the Financial Services Authority as part of the registration statement, except information regarding nominal value, number and price of offered Securities, underwriting of Securities, bond interest rates, or other matters related to offering requirements that cannot yet be determined.
8. Summary Prospectus is a summary of the contents of the Initial Prospectus.
9. Registration Statement is a document that must be submitted to the Financial Services Authority by the Issuer in the context of a Public Offering or for a Public Company.

CHAPTER II
SECURITIES MARKETING PROMOTION
Article 2
In the context of a Public Offering by an Issuer or marketing of Securities by a Securities Company, securities marketing promotion including advertising, brochures, or other communications to the public, which is not a Prospectus, Summary Prospectus, Initial Prospectus, or info memo, is prohibited from:
a. containing false information or failing to disclose material facts, thereby giving a misleading impression; and/or b. giving a misleading impression, because the content and/or presentation method gives the impression that certain Securities are suitable for specific Parties who actually do not have sufficient capacity to bear the risks associated with those Securities.

Article 3
Securities marketing promotion must:
a. contain information that certain promoted Securities are only suitable for specific investor groups; and b. disclose risks related to investment in the aforementioned certain Securities.

Article 4
In the event that securities marketing promotion contains recommendations to buy, sell, or hold certain Securities, the securities marketing promotion must contain at least the following information:
a. the date of the recommendation; b. the market price at the time the recommendation was made;
c. the Party providing the recommendation; and
d. details on whether the Party providing the recommendation or its affiliated Party has regularly traded such Securities for its own account or holds such Securities with a value of at least IDR 25,000,000.00 (twenty-five million rupiah).

Article 5
In the event that securities marketing promotion contains opinions, projections, or forecasts regarding certain Securities, such opinions, projections, or forecasts regarding certain Securities must be clearly disclosed.

Article 6
In the context of a Public Offering, securities marketing promotion must contain information that investors can only place orders to purchase Securities after the aforementioned investors have obtained the Prospectus or obtained the opportunity to read the Prospectus, and after the Registration Statement has become effective.

CHAPTER III
SANCTION PROVISIONS
Article 7
(1) Any Party violating the provisions as referred to in Articles 2 through 6 shall be subject to administrative sanctions.
(2) Sanctions as referred to in paragraph (1) shall also be imposed on Parties causing the occurrence of violations 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) The procedure for imposing sanctions as referred to in paragraph (3) is carried out in accordance with applicable legislation.
(6) 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. (7) 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.

Article 8
In addition to administrative sanctions as referred to in Article 7 paragraph (4), the Financial Services Authority may take specific actions against any Party violating the provisions of this Financial Services Authority Regulation.

Article 9
The Financial Services Authority may announce the imposition of administrative sanctions as referred to in Article 7 paragraph (4) and specific actions as referred to in Article 8 to the public.

CHAPTER IV
CLOSING PROVISIONS
Article 10
Upon the commencement of this Financial Services Authority Regulation, the Decision of the Chairman of the Capital Market and Financial Institution Supervisory Board Number Kep-122/PM/1996 concerning Securities Marketing Promotion including Advertising, Brochures, or Other Communications to the Public, along with Regulation Number IX.A.9 which is its attachment, is repealed and declared invalid.

Article 11
This Financial Services Authority Regulation shall come into force on the date of its promulgation.

This copy is in accordance with the original
Director of Law 1
Legal Department signed
Yuliana

To ensure that everyone knows it, it is ordered to promulgate this Financial Services Authority Regulation by placing it in the State Gazette of the Republic of Indonesia.
Determined in Jakarta on February 8, 2019
CHAIRMAN OF THE BOARD OF COMMISSIONERS
FINANCIAL SERVICES AUTHORITY
REPUBLIC OF INDONESIA, signed
WIMBOH SANTOSO

Promulgated in Jakarta on February 11, 2019
MINISTER OF LAW AND HUMAN RIGHTS
REPUBLIC OF INDONESIA, signed
YASONNA H. LAOLY
STATE GAZETTE OF THE REPUBLIC OF INDONESIA YEAR 2019 NUMBER 29

EXPLANATION
OF
FINANCIAL SERVICES AUTHORITY REGULATION
OF THE REPUBLIC OF INDONESIA
NUMBER 7/POJK.04/2019
ON
SECURITIES MARKETING PROMOTION INCLUDING ADVERTISING, BROCHURES, OR OTHER COMMUNICATIONS TO THE PUBLIC

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 and Financial Institution Supervisory Board to the Financial Services Authority.

In relation to the above, it is necessary to reorganize the existing regulatory structure, particularly those related to the capital market sector, by converting Capital Market and Financial Institution Supervisory Board regulations related to the capital market sector into Financial Services Authority Regulations. This reorganization is carried out so that Financial Services Authority Regulations related to the capital market sector are consistent with Financial Services Authority Regulations in other sectors.

Based on the background thinking and aspects mentioned, it is necessary to replace the existing capital market sector legislation regulating securities marketing promotion including advertising, brochures, or other communications to the public, namely the Decision of the Chairman of the Capital Market and Financial Institution Supervisory Board Number Kep-122/PM/1996 concerning Securities Marketing Promotion including Advertising, Brochures, or Other Communications to the Public, along with Regulation Number IX.A.9 which is its attachment, into a Financial Services Authority Regulation concerning Securities Marketing Promotion including Advertising, Brochures, or Other Communications to the Public.

II. ARTICLE BY ARTICLE
Article 1
Is sufficiently clear.

Article 2
Is sufficiently clear.

Article 3
Is sufficiently clear.

Article 4
Is sufficiently clear.

Article 5
Is sufficiently clear.

Article 6
Is sufficiently clear.

Article 7
Is sufficiently clear.

Article 8
The term "specific actions" includes, among others, the postponement of the issuance of an effective statement for a Registration Statement in the context of a Public Offering.

Article 9
Is sufficiently clear.

Article 10
Is sufficiently clear.

Article 11
Is sufficiently clear.

SUPPLEMENT TO THE STATE GAZETTE OF THE REPUBLIC OF INDONESIA NUMBER 6314