Financial Services Authority Regulation Number 9 of 2018 on Takeover of Public Companies

COPY
FINANCIAL SERVICES AUTHORITY REGULATION
NUMBER 9 /POJK.04/2018
CONCERNING
TAKEOVER OF PUBLIC COMPANIES
BY THE GRACE OF GOD THE ALMIGHTY,
THE COMMISSIONERS OF THE FINANCIAL SERVICES AUTHORITY, Considering:
a. that in order to enhance protection for public shareholders and improve the quality of information disclosure to the community, it is necessary to refine regulations regarding the takeover of public companies; b. that based on the considerations as referred to in letter a, it is necessary to establish a Financial Services Authority Regulation concerning the Takeover of Public Companies; Recalling:

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);
   FINANCIAL SERVICES AUTHORITY
   REPUBLIC OF INDONESIA

DECIDES:
Establish: FINANCIAL SERVICES AUTHORITY REGULATION CONCERNING THE TAKEOVER OF PUBLIC COMPANIES.

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

1. Public Company is an issuer that has conducted a public offering of equity securities or a public company.
2. Organized Group is a party that makes plans, agreements, or decisions to cooperate to achieve specific objectives.
3. Party is an individual, company, joint venture, association, or Organized Group.
4. Controller of a Public Company, hereinafter referred to as Controller, is a Party that directly or indirectly:
   a. owns more than 50% (fifty percent) of all shares with voting rights of a Public Company that have been fully paid up; or b. has the ability to determine, directly or indirectly, in any manner, the management and/or policy of a Public Company.
5. Takeover of a Public Company, hereinafter referred to as Takeover, is an action, direct or indirect, that results in a change of Controller.
6. Mandatory Tender Offer is an offer to purchase the remaining shares of a Public Company that must be conducted by the new Controller.
7. Major Shareholder is a Party that, directly or indirectly, owns at least 20% (twenty percent) of the voting rights of all issued shares with voting rights of a company or a smaller amount as determined by the Financial Services Authority.
8. Stock Exchange is a Party that organizes and provides systems and/or facilities to match buy and sell offers of other Parties' securities with the aim of trading securities among them.

Article 2
Control over a Public Company based on the ability to determine, directly or indirectly, in any manner, the management and/or policy of the Public Company can be proven with documents and/or information showing that a Party exercises control over the Public Company.

Article 3
In the event that there are provisions in specific business fields that regulate criteria for Controllers and/or control that differ from the criteria regulated in this Financial Services Authority Regulation, in the application of this Financial Services Authority Regulation, the criteria for Controllers as referred to in Article 1 number 4 shall apply.

CHAPTER II
NEGOTIATION IN TAKEOVER
Article 4
(1) A prospective new Controller who conducts negotiations that may result in a Takeover may announce the negotiation regarding the planned Takeover.
(2) In the event that the prospective new Controller decides to announce the Takeover negotiation, the announcement must be conducted at least through:
a. 1 (one) daily newspaper in Indonesian with national circulation; or b. the Stock Exchange website.
(3) Information contained in the announcement as referred to in paragraph (2) must include at least:
a. the name of the Public Company to be taken over; b. the estimated number of shares to be taken over;
c. the identity of the prospective new Controller, including the name, address, telephone, email, and business activities, if the prospective new Controller is a business entity;
d. the number of securities already owned by the prospective new Controller, if they already own securities of the Public Company to be taken over; e. the purpose of control; f. plans, agreements, or decisions to cooperate between Parties in the Organized Group in the context of controlling the Public Company, if the Takeover is conducted by an Organized Group and there are plans, agreements, or decisions made by Parties within that Organized Group; g. the method and process of Takeover negotiation; and h. the material of the Takeover negotiation. (4) In the event that the prospective new Controller makes an announcement through the media as referred to in paragraph (2) letter a, the prospective new Controller must submit the announcement to:
a. the Public Company to be taken over; b. the Financial Services Authority; and
c. the Stock Exchange where the shares of the Public Company to be taken over are listed,
on the same day as the announcement as referred to in paragraph (2).
(5) In the event that the prospective new Controller makes an announcement through the media as referred to in paragraph (2) letter b, the prospective new Controller must submit the announcement to:
a. the Public Company to be taken over; and b. the Financial Services Authority, on the same day as the announcement as referred to in paragraph (2).

Article 5
(1) In the event that the prospective new Controller announces negotiation as referred to in Article 4 paragraph (2), the prospective new Controller must:
a. announce information on every development of the negotiation, including postponement and/or cancellation of the Takeover plan, in at least:

1. 1 (one) daily newspaper in Indonesian with national circulation; or
2. the Stock Exchange website; and
   b. submit the announcement as referred to in paragraph (1) letter a to:
3. the Public Company to be taken over, the Financial Services Authority, and the Stock Exchange where the shares of the Public Company to be taken over are listed, if the announcement is conducted through 1 (one) daily newspaper in Indonesian with national circulation; or
4. the Public Company to be taken over and the Financial Services Authority, if the announcement is conducted through the Stock Exchange website.
   (2) The announcement and submission of the announcement as referred to in paragraph (1) letter a and letter b must be conducted at the latest 2 (two) working days after the development of the negotiation occurs.

Article 6
In the event that the prospective new Controller decides not to announce the negotiation as referred to in Article 4 paragraph (1), the prospective new Controller including Parties involved in the negotiation must keep the negotiation information confidential.

CHAPTER III
TAKEOVER OF PUBLIC COMPANIES
Article 7
(1) After the Takeover occurs, the new Controller must:
a. announce in at least 1 (one) daily newspaper in Indonesian with national circulation or the Stock Exchange website and submit to the Financial Services Authority regarding the occurrence of the Takeover at the latest 1 (one) working day after the occurrence of the Takeover; and b. conduct a Mandatory Tender Offer except against:

1. shares owned by shareholders who have conducted Takeover transactions with the new Controller;
2. shares owned by other Parties who have already received offers with the same terms and conditions from the new Controller;
3. shares owned by other Parties who simultaneously also conduct a Mandatory Tender Offer or voluntary tender offers for the same Public Company shares;
4. shares owned by Major Shareholders; and
5. shares owned by other Controllers of that Public Company.
   (2) The announcement as referred to in paragraph (1) letter a must contain at least information regarding:
   a. the total number of shares taken over, the name of shareholders whose shares were taken over by the new Controller if the Takeover is conducted outside the Stock Exchange, the Takeover price per share, the total value of the Takeover, and the total share ownership; b. identity information including:
6. the name of the new Controller;
7. address;
8. telephone;
9. email; and
10. business activities, management and supervisory board composition, and capital structure and equivalent information, if the new Controller is a business entity;
    c. the purpose of control;
    d. a statement that the new Controller is an Organized Group, if the new Controller is an Organized Group; e. the beneficiaries of the Party conducting the Takeover, if the Party is not the beneficiary; f. the nature of affiliation relationships with the Public Company, if there are affiliation relationships; and g. a description of approvals from competent authorities, if approvals from competent authorities are required.

Article 8
(1) The new Controller may appoint another Party to conduct the Mandatory Tender Offer as referred to in Article 7 paragraph (1) letter b on behalf of and for the name of the new Controller.
(2) The other Party as referred to in paragraph (1) is a Party whose shares are owned by the new Controller by more than 50% (fifty percent) of all shares with voting rights that have been fully paid up, directly or indirectly. (3) In the event that the obligation to conduct a Mandatory Tender Offer is conducted by the Party as referred to in paragraph (1), that Party must execute all procedures for the implementation of the Mandatory Tender Offer as regulated in this Financial Services Authority Regulation.

Article 9
Takeover does not require approval from the General Meeting of Shareholders of the Public Company being taken over, unless such approval from the General Meeting of Shareholders is required by legislation regulating the business field of the Public Company being taken over.

Article 10
In the event that the Takeover is conducted by a Public Company, that Public Company is not required to obtain approval from shareholders in the General Meeting of Shareholders regarding the Takeover, unless such approval is required by specific legislation regulating the business field of the Public Company conducting the Takeover.

Article 11
In every Takeover, if between a Major Shareholder or Controller and the prospective new Controller there is a contract or activity that results in:
a. the use of resources of the Public Company to be taken over in a material amount; b. changes to agreements or arrangements already made by the Public Company to be taken over; or
c. changes to the standard operating procedures of the Public Company to be taken over,
where such contract or activity constitutes an affiliate transaction and/or a transaction containing a conflict of interest, it must comply with the provisions of capital market sector legislation regarding affiliate transactions and specific conflict of interest transactions.

CHAPTER IV
IMPLEMENTATION OF MANDATORY TENDER OFFER
Article 12
(1) In the implementation of the Mandatory Tender Offer as referred to in Article 7 paragraph (1) letter b, the new Controller must submit to the Financial Services Authority documents consisting of:
a. a cover letter; b. the text of the information disclosure announcement for the Mandatory Tender Offer; and
c. other supporting documents.
(2) The documents as referred to in paragraph (1) letter b and letter c must also be submitted to the Public Company being taken over.
(3) The submission of documents as referred to in paragraph (1) and paragraph (2) must be conducted at the latest 2 (two) working days after the announcement of the Takeover as referred to in Article 7 paragraph (1) letter a. (4) The text of the information disclosure announcement in the Mandatory Tender Offer as referred to in paragraph (1) letter b, must contain at least information regarding:
a. the background of the Takeover; b. information about shares, including:

1. an explanation of the number and percentage of shares to be purchased; and
2. the number and percentage of shares of the Public Company being taken over, owned directly or indirectly by the new Controller, including options to purchase or rights to receive dividends or other benefits and the power to use voting rights in the General Meeting of Shareholders of the Public Company being taken over, the name of shareholders whose shares were taken over if the Takeover is conducted outside the Stock Exchange, the Takeover price of shares and the total value of the Takeover, and the date of the Takeover;
   c. information about the new Controller, including:
3. in the event the Takeover is conducted by an individual, information regarding name, address, nationality, and affiliation relationships with the Public Company must be disclosed, if there are affiliation relationships; and
4. in the event the Takeover is conducted by a Party other than an individual, information regarding establishment, address, telephone, email, business activities, capital structure, composition of shareholders, composition of the board of directors and board of commissioners, beneficial owners, affiliation relationships with the Public Company if there are affiliation relationships, and a description of approvals from competent authorities if there are approvals from competent authorities, must be disclosed;
   d. information about the Public Company being taken over, including name, address, telephone, email, and business activities; e. contracts or activities between a Major Shareholder or Controller and the new Controller as referred to in Article 11 that materially affect the Public Company, if there are contracts or activities that have a material effect; f. terms and conditions of the Mandatory Tender Offer, including:
5. the purchase price and its calculation method;
6. the implementation period;
7. provisions regarding payment;
8. the purchase mechanism; and
9. an explanation of approvals or requirements set by the Government that must be fulfilled in connection with the Mandatory Tender Offer, if there are approvals or requirements set by the Government that must be fulfilled in connection with the Mandatory Tender Offer;
   g. a list of names and addresses of capital market supporting institutions and/or professions involved in the Mandatory Tender Offer; and h. other important information, including:
10. a description of legal lawsuits related to the Takeover, if there are legal lawsuits;
11. a statement that the new Controller has sufficient funds and discloses the source of funds used by the new Controller in the implementation of the Mandatory Tender Offer;
12. development plans for the Public Company; and
13. additional information required so that information disclosure in the context of the Mandatory Tender Offer is not misleading.

Article 13
(1) The Financial Services Authority may request changes and/or additional information regarding the documents as referred to in Article 12 paragraph (1) for the purpose of review or disclosure to the public. (2) In the event that the Financial Services Authority requests changes and/or additional information as referred to in paragraph (1), the new Controller must submit the changes and/or additional information at the latest 5 (five) working days after receipt of the request for changes and/or additional information by the Financial Services Authority. (3) The new Controller must announce information disclosure in the form of the announcement text as referred to in Article 12 paragraph (1) in the context of the Mandatory Tender Offer at the latest 2 (two) working days after receiving a letter from the Financial Services Authority stating that the new Controller may announce information disclosure in the context of the Mandatory Tender Offer. (4) The announcement as referred to in paragraph (3) must be conducted at least through:
a. 1 (one) daily newspaper with national circulation; or b. the Stock Exchange website.

Article 14
The new Controller must:
a. implement the Mandatory Tender Offer for 30 (thirty) days starting 1 (one) day after the announcement as referred to in Article 13 paragraph (3); and b. complete the Mandatory Tender Offer transaction by way of payment, at the latest 12 (twelve) days after the end of the offer period as referred to in letter a.

Article 15
(1) Shareholders of the Public Company who will sell their shares in connection with the Mandatory Tender Offer must submit those shares to the custodian appointed by the new Controller.
(2) Shareholders of the Public Company as referred to in paragraph (1) may withdraw back the shares they own at any time before the Mandatory Tender Offer as referred to in Article 14 letter a ends.

Article 16
(1) The new Controller must submit a report on the results of the Mandatory Tender Offer to the Financial Services Authority at the latest 5 (five) working days after the end of the transaction settlement as referred to in Article 14 letter b. (2) The report as referred to in paragraph (1) must contain at least information regarding:
a. the number of shares that must be purchased in the Mandatory Tender Offer; b. the implementation period of the Mandatory Tender Offer;
c. the date of settlement of the Mandatory Tender Offer transaction;
d. a list of shareholders who sold their shares; e. the number of shares that have been purchased in the implementation of the Mandatory Tender Offer; and f. the composition of share ownership of the new Controller before and after the Mandatory Tender Offer.

Article 17
In the implementation of the Mandatory Tender Offer, the purchase price of shares of the Public Company being taken over must be determined with the following provisions:
a. in the event the Takeover is conducted directly on shares of a Public Company listed and traded on a Stock Exchange, the purchase price of shares must be at least:

1. the average price of the highest daily trading prices on the Stock Exchange in the last 90 (ninety) days:
   a) before the announcement of the Takeover as referred to in Article 7 paragraph (1) letter a; b) before the announcement of negotiation as referred to in Article 4 paragraph (2), if the prospective new Controller announces the negotiation; c) before the announcement of information as referred to in the Financial Services Authority Regulation regarding the addition of capital of a Public Company by granting preemptive rights that has disclosed information regarding the prospective new Controller, if the Takeover occurs due to the addition of capital of a Public Company by granting preemptive rights; or d) before the information disclosure as referred to in the Financial Services Authority Regulation regarding the addition of capital of a Public Company without granting preemptive rights, if the Takeover occurs due to the addition of capital of a Public Company without granting preemptive rights; or
2. the Takeover price that has already been conducted,
   whichever is higher; b. in the event the Takeover is conducted directly on shares of a Public Company listed and traded on a Stock Exchange, but during 90 (ninety) days or more before the announcement as referred to in letter a number 1 letter a) to letter d) were not traded on the Stock Exchange or their trading was temporarily suspended by the Stock Exchange, the purchase price of shares must be at least:
3. the average price of the highest daily trading prices on the Stock Exchange in the last 12 (twelve) months calculated backwards from the last trading day or the day trading was suspended; or
4. the Takeover price that has already been conducted,
   whichever is higher;
   c. in the event the Takeover is conducted directly on shares of a Public Company not listed and not traded on a Stock Exchange, the purchase price of shares must be at least:
5. the Takeover price that has already been conducted; or
6. the fair value determined by an appraiser registered with the Financial Services Authority,
   whichever is higher; d. in the event the Takeover is conducted indirectly on shares of a Public Company listed and traded on a Stock Exchange, the purchase price of shares must be at least the average price of the highest daily trading prices on the Stock Exchange in the last 90 (ninety) days before the announcement as referred to in letter a number 1 letter a) to letter d); e. in the event the Takeover is conducted indirectly on shares of a Public Company listed and traded on a Stock Exchange, but during 90 (ninety) days or more before the announcement of the Takeover as referred to in letter a number 1 letter a) to letter d) were not traded on the Stock Exchange or their trading was temporarily suspended by the Stock Exchange, the purchase price of shares must be at least the average price of the highest daily trading prices on the Stock Exchange in the last 12 (twelve) months calculated backwards from the last trading day or the day trading was suspended; or f. in the event the Takeover is conducted indirectly on shares of a Public Company not listed and not traded on a Stock Exchange, the purchase price of shares must be equal to the fair value determined by an appraiser registered with the Financial Services Authority.

Article 18
In the event that the start of the implementation of the Mandatory Tender Offer exceeds the 6 (six) month time limit after:
a. the announcement of the Takeover as referred to in Article 7 paragraph (1) letter a; b. the announcement of negotiation as referred to in Article 4 paragraph (2);
c. the announcement of information as referred to in Article 17 letter a number 1 letter c); or
d. the information disclosure as referred to in Article 17 letter a number 1 letter d), the time period for determining the price of the Mandatory Tender Offer as referred to in Article 17 letter a and letter d shifts following the implementation period of the Mandatory Tender Offer.

Article 19
In the event that the price of the Mandatory Tender Offer after the shifted time period as referred to in Article 18 is lower than the implementation price as referred to in Article 17 letter a and letter d,

The execution price of the Mandatory Tender Offer must use the execution price as referred to in Article 17 letters a and d.

Article 20
The new controller is prohibited from setting different restrictions and requirements based on the classification or position of the Party that is a shareholder, unless there is a differentiation of rights or benefits attached to the said shares.

CHAPTER V
OBLIGATION TO REFLOAT SHARES

Article 21
(1) In the event that the implementation of the Mandatory Tender Offer results in the new controller's share ownership being greater than 80% (eighty percent) of the paid-up capital of the Public Company, the new controller is obligated to refloat the Public Company's shares to the public so that the shares owned by the public are at least 20% (twenty percent) of the paid-up capital of the Public Company. (2) In the event that the Takeover results in the new controller owning shares of the Public Company greater than 80% (eighty percent) of the paid-up capital of the Public Company, the said new controller is obligated to refloat the Public Company's shares to the public with an amount of at least the percentage of shares obtained at the time of the implementation of the Mandatory Tender Offer. (3) The obligation to refloat the Public Company's shares as referred to in paragraph (1) and paragraph (2) must be carried out within a maximum period of 2 (two) years since the Mandatory Tender Offer was completed. (4) The obligation to refloat shares by the new controller as referred to in paragraph (1) and paragraph (2) does not apply if after the Takeover, the Public Company carries out a corporate action that results in the fulfillment of the requirements as referred to in paragraph (1) and paragraph (2).

Article 22
(1) The new controller is obligated to report the progress of fulfilling the obligation to refloat shares to the Financial Services Authority periodically every 3 (three) months with report dates of March 31, June 30, September 30, and December 31 until the entire obligation to refloat shares is completed. (2) The report on the progress of fulfilling the obligation to refloat shares as referred to in paragraph (1) for the first time must be submitted on the nearest report period date. (3) Information on the progress of fulfilling the obligation to refloat shares as referred to in paragraph (1) must at least contain:
a. the number and percentage of shares that must be refloated; b. the number and percentage of shares that have been refloated;
c. the remaining shares that must be refloated;
d. the date of refloating shares; e. the price of refloating shares; f. the method of refloating shares, either through the Stock Exchange or outside the Stock Exchange; and g. the Party receiving the refloated shares, if the refloating of shares is carried out outside the Stock Exchange. (4) The progress report as referred to in paragraph (1) must be submitted no later than on the 10th (ten) working day of the following month.

CHAPTER VI
EXEMPTIONS

Article 23
The provisions as referred to in Article 7 paragraph (1) letters a and b do not apply if:
a. The Takeover occurs due to marriage or inheritance; b. The Takeover that occurs due to the purchase or acquisition of shares of the Public Company within a period of every 12 (twelve) months in an amount of at most 10% (ten percent) of the outstanding shares with valid voting rights, by a Party that previously did not own shares of the Public Company;
c. The Takeover occurs due to the implementation of duties and authority of a government or state body or institution based on Law;
d. The Takeover occurs due to the direct purchase of shares owned and/or controlled by a government or state body or institution as the implementation of provisions as referred to in letter c; e. The Takeover occurs due to a court decision or ruling that has permanent legal force; f. The Takeover occurs due to business merger, business separation, business consolidation, or the implementation of shareholder liquidation; g. The Takeover occurs due to a gift which is the transfer of shares without an agreement to obtain compensation in any form; h. The Takeover occurs due to certain debt guarantees that have been established in a loan agreement, as well as debt guarantees in the context of the restructuring of the Public Company established by a government or state body or institution based on Law;
i. The Takeover occurs due to the acquisition of shares by shareholders exercising their rights according to their share ownership proportion as regulated in the Financial Services Authority Regulation regarding the increase in capital of the Public Company by granting the right to pre-emptive subscription;
j. The Takeover that occurs due to the acquisition of shares by Parties in the implementation of capital increase in the context of improving financial position as regulated in the Financial Services Authority Regulation regarding the increase in capital of the Public Company without pre-emptive subscription rights; k. The Takeover occurs due to the implementation of policy by a government or state body or institution;
l. the implementation of the Mandatory Tender Offer will conflict with legislation;
m. The Takeover occurs due to the implementation of a voluntary tender offer as regulated in the Financial Services Authority Regulation regarding voluntary tender offers; or n. The Takeover that has been disclosed in the prospectus of the public offering of equity securities as long as the disclosure has met the provisions as regulated in the Financial Services Authority Regulation regarding the form and content of the prospectus and the summary prospectus in the context of the public offering of equity securities that is carried out no later than 1 (one) year after the effectiveness of the registration statement.

Article 24
(1) In the event that the Takeover occurs due to the increase in capital of the Public Company by granting pre-emptive subscription rights which are not exempted as referred to in Article 23 letter i, the new controller is obligated to carry out the Mandatory Tender Offer as referred to in Article 7 paragraph (1) letter b. (2) The implementation of the Mandatory Tender Offer as referred to in paragraph (1) must follow the provisions as referred to in Article 12, Article 13, and Article 14, except for the provisions regarding the time limit for submitting documents as referred to in Article 12 paragraph (3). (3) The submission of documents in the context of the implementation of the Mandatory Tender Offer as referred to in paragraph (1) must be carried out no later than 2 (two) working days after the last distribution of shares in the implementation of the increase in capital of the Public Company by granting pre-emptive subscription rights.

Article 25
(1) In the event that a Takeover as referred to in Article 24 occurs but in the information disclosure related to the increase in capital of the Public Company by granting pre-emptive subscription rights, there is no disclosure regarding the Takeover, the new controller is obligated to announce the Takeover as referred to in Article 7 paragraph (1) letter a except for the provisions regarding the time of announcement. (2) The announcement as referred to in paragraph (1) must be carried out no later than 1 (one) working day after the last distribution of shares in the implementation of the increase in capital of the Public Company by granting pre-emptive subscription rights. (3) The new controller as referred to in paragraph (1) is obligated to carry out the Mandatory Tender Offer as referred to in Article 7 paragraph (1) letter b. (4) The implementation of the Mandatory Tender Offer as referred to in paragraph (3) must follow the provisions as referred to in Article 12, Article 13, and Article 14.

Article 26
(1) In the event that the Takeover occurs due to the increase in capital of the Public Company without pre-emptive subscription rights which are not exempted as referred to in Article 23 letter j, the new controller is obligated to carry out the Mandatory Tender Offer as referred to in Article 7 paragraph (1) letter b. (2) The implementation of the Mandatory Tender Offer as referred to in paragraph (1) must follow the provisions as referred to in Article 12, Article 13, and Article 14 except for the provisions regarding the time limit for submitting documents as referred to in Article 12 paragraph (3). (3) The submission of documents in the context of the implementation of the Mandatory Tender Offer as referred to in paragraph (1) must be carried out no later than 2 (two) working days after the implementation of the increase in capital of the Public Company without granting pre-emptive subscription rights.

Article 27
The provisions as referred to in Article 7 paragraph (1) and paragraph (2) do not apply to Takeovers carried out indirectly through another Public Company, if the revenue contribution of the Public Company to the said other Public Company is less than 50% (fifty percent) based on the latest annual consolidated financial statements of the other Public Company.

Article 28
(1) In the event that a Takeover occurs as referred to in Article 23, the new controller is obligated to announce the occurrence of the Takeover in at least:
a. 1 (one) daily newspaper in Indonesian language with national circulation; or b. the Stock Exchange website.
(2) The obligation as referred to in paragraph (1) does not apply to the Takeover as referred to in Article 23 letters a, b, e, and f.
(3) The announcement as referred to in paragraph (1) must at least cover:
a. the identity of the new controller; b. the name of the Public Company being taken over;
c. the percentage of shares of the Public Company being taken over;
d. the number of shares owned by the new controller before and after the Takeover; and e. valid supporting evidence.
(4) The announcement as referred to in paragraph (1) must be submitted to:
a. the Public Company being taken over, the Financial Services Authority, and the Stock Exchange, if the announcement is made through a daily newspaper; or b. the Public Company being taken over and the Financial Services Authority, if the announcement is made through the Stock Exchange website, no later than 2 (two) working days after the Takeover.

Article 29
In the event that a Takeover occurs as referred to in Article 23 letters d and h, in addition to containing information as referred to in Article 28 paragraph (3), the announcement must contain information regarding:
a. affiliation relationships, if there are affiliation relationships; b. the reason for the Takeover; and
c. the new controller's plans for the Public Company being taken over.

CHAPTER VII
OTHER PROVISIONS

Article 30
Proof of announcement that must be announced in newspapers and/or the Stock Exchange website as regulated in this Financial Services Authority Regulation must be submitted to the Financial Services Authority no later than 2 (two) working days after the announcement is published.

Article 31
Takeovers carried out by Public Companies whose value meets the criteria for material transactions as referred to in legislation in the capital market sector regulating material transactions and changes in main business activities, in addition to being obligated to follow this Financial Services Authority Regulation, must also meet the provisions of legislation in the capital market sector regulating material transactions and changes in main business activities.

Article 32
Ongoing transactions that have been carried out between the new controller and the Public Company being taken over before the Takeover is carried out and meet the criteria for affiliate transactions and/or transactions containing conflicts of interest as referred to in legislation in the capital market sector regulating affiliate transactions and conflicts of interest in certain transactions, are exempted from fulfilling the provisions of legislation in the capital market sector regulating affiliate transactions and conflicts of interest in certain transactions until the agreement in such transaction is updated.

CHAPTER VIII
SANCTION PROVISIONS

Article 33
(1) Without prejudice to criminal provisions in the capital market field, the Financial Services Authority has the authority to impose administrative sanctions on any Party that violates the provisions of this Financial Services Authority Regulation, including Parties that cause the violation to occur, in the form 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.
(2) Administrative sanctions as referred to in paragraph (1) letters b, c, d, e, f, or g may be imposed with or without being preceded by the imposition of administrative sanctions 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 34
In addition to administrative sanctions as referred to in Article 33 paragraph (1), the Financial Services Authority may carry out certain actions against any Party that violates the provisions of this Financial Services Authority Regulation.

Article 35
The Financial Services Authority may announce the imposition of administrative sanctions as referred to in Article 33 paragraph (1) and certain actions as referred to in Article 34 to the public.

CHAPTER IX
TRANSITIONAL PROVISIONS

Article 36
(1) For Public Companies that have submitted a registration statement in the context of increasing capital by granting pre-emptive subscription rights that may result in a change of Controller of the Public Company but at the time this Financial Services Authority Regulation comes into force the registration statement has not yet obtained an effectiveness statement, the new controller remains exempt from the obligations as referred to in number 3 letter a of Regulation Number IX.H.1, appendix of the Decision of the Chairman of the Capital Market Supervisory Board and Financial Institutions Number Kep-264/BL/2011 regarding Takeover of Public Companies. (2) For Public Companies that have carried out information disclosure in the context of increasing capital without granting pre-emptive subscription rights that may result in a change of Controller of the Public Company before this Financial Services Authority Regulation comes into force, the new controller remains exempt from the obligations as referred to in number 3 letter a of Regulation Number IX.H.1, appendix of the Decision of the Chairman of the Capital Market Supervisory Board and Financial Institutions Number Kep-264/BL/2011 regarding Takeover of Public Companies.

Article 37
For new controllers who have submitted Mandatory Tender Offer documents to the Financial Services Authority before this Financial Services Authority Regulation comes into force and have not yet obtained a letter from the Financial Services Authority stating that the new controller can announce information disclosure in the context of the Mandatory Tender Offer, must follow this Financial Services Authority Regulation.

Article 38
New controllers who still have the obligation to refloat the shares they own as referred to in Regulation Number IX.H.1, Appendix of the Decision of the Chairman of the Capital Market Supervisory Board and Financial Institutions Number Kep-264/BL/2011 regarding Takeover of Public Companies, remain obligated to carry out the refloating of shares until the time limit regulated in Regulation Number IX.H.1, Appendix of the Decision of the Chairman of the Capital Market Supervisory Board and Financial Institutions Number Kep-264/BL/2011 or the extension time limit that has been given by the Financial Services Authority.

CHAPTER X
CLOSING PROVISIONS

Article 39
At the time this Financial Services Authority Regulation comes into force, Regulation Number IX.H.1, Appendix of the Decision of the Chairman of the Capital Market Supervisory Board and Financial Institutions Number Kep-264/BL/2011 regarding Takeover of Public Companies, is repealed and declared invalid.

Article 40
This Financial Services Authority Regulation comes into force on the date of its promulgation.

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

In order that everyone may know it, order the promulgation of this Financial Services Authority Regulation by placing it in the State Journal of the Republic of Indonesia.
Determined in Jakarta on July 25, 2018
CHAIRMAN OF THE COMMISSIONERS BOARD
FINANCIAL SERVICES AUTHORITY, signed
WIMBOH SANTOSO

Promulgated in Jakarta on July 27, 2018
MINISTER OF LAW AND HUMAN RIGHTS
REPUBLIC OF INDONESIA, signed
YASONNA H. LAOLY

STATE JOURNAL OF THE REPUBLIC OF INDONESIA YEAR 2018 NUMBER 114

EXPLANATION
OF
FINANCIAL SERVICES AUTHORITY REGULATION
NUMBER 9 /POJK.04/2018
REGARDING
TAKEOVER OF PUBLIC COMPANIES

I. GENERAL
In entering the era of free trade and globalization and increasingly fierce business competition in Indonesia, every company is challenged to be able to maintain its existence in the long term. One way that can be done by companies is by improving company performance and strengthening the financial conditions or capital conditions owned by the company. This strengthening of capital conditions can be achieved by carrying out corporate actions, including through increasing paid-up capital or through takeovers or acquisitions. In Public Companies, to protect investors, especially public shareholders, and to maintain the orderly, fair, transparent, and accountable operation of the capital market, it is necessary to regulate corporate actions to be carried out by Public Companies or carried out by shareholders of a Public Company. One of the regulations referred to is Regulation Number IX.H.1, Appendix of the Decision of the Chairman of the Capital Market Supervisory Board Number: Kep-264/BL/2011 regarding Takeover of Public Companies. This regulation was issued to protect the interests of public shareholders from the occurrence of takeovers by new controllers in a Public Company. In the implementation of the Mandatory Tender Offer, there are no provisions limiting the number of public shares that can be obtained by the new controller, so there is a possibility that the new controller will own all shares of the Public Company as a result of the implementation of the Mandatory Tender Offer. In this regard, to prevent Public Companies from becoming private companies (go private) and to maintain the number of Issuers in the capital market, Regulation Number IX.H.1 also regulates the refloating of shares if the implementation of the Mandatory Tender Offer results in share ownership by the new controller being greater than 80% (eighty percent) of the paid-up capital of the Public Company. In practice, in the implementation of the obligation to refloat shares (refloat), the new controller extends the time limit for refloating shares several times so that the process of fulfilling this obligation becomes very long and there is no clear legal certainty. Considering the uncertainty of the implementation of the refloat resulting from the Mandatory Tender Offer due to the extension of the refloat time limit several times, it is necessary to improve Regulation Number IX.H.1 to overcome problems related to the refloat by establishing a Financial Services Authority Regulation regarding the Takeover of Public Companies.

II. ARTICLE BY ARTICLE
Article 1
Clearly sufficient.

Article 2
Documents and/or information can include among others:
a. agreements with other shareholders, so as to have voting rights of more than 50% (fifty percent); b. authority to regulate the financial and operational policies of the Public Company based on the articles of association/agreement;
c. authority to appoint or replace most members of the board of directors and board of commissioners who control the Public Company through the board of directors and board of commissioners;
d. ability to control the majority of votes at the board of directors meeting and board of commissioners meeting so as to be able to control the Public Company; and/or e. other abilities that can indicate control of the Public Company.

Article 3
What is meant by "provisions in certain business fields that regulate criteria for Controllers and/or control that are different from the criteria regulated in this Financial Services Authority Regulation" includes among others provisions that regulate the definition of controlling shareholders in the banking, insurance, or financing industries.

Article 4
Paragraph (1)
Clearly sufficient.
Paragraph (2)
Letter a
Clearly sufficient.
Letter b
Announcements through the Stock Exchange website can be carried out if the Party carrying out the Takeover is a Public Company.
Paragraph (3)
Letter a
Clearly sufficient.
Letter b
Clearly sufficient.
Letter c
Clearly sufficient.
Letter d
Clearly sufficient.
Letter e
Clearly sufficient.
Letter f
Plans, agreements, or decisions to cooperate between Parties in the Organized Group in the context of controlling the Public Company can be based on written or unwritten agreements.
Letter g
Clearly sufficient.
Letter h
Clearly sufficient.
Paragraph (4)
Clearly sufficient.
Paragraph (5)
Clearly sufficient.

Article 5
Paragraph (1)
Letter a
Number 1
Clearly sufficient.
Number 2
Announcements on the Stock Exchange website can be carried out if the Party carrying out the Takeover is a Public Company.
Letter b
Clearly sufficient.
Paragraph (2)
Clearly sufficient.

Article 6
Clearly sufficient.

Article 7
Paragraph (1)
Letter a
Announcements on the Stock Exchange website can be carried out if the Party carrying out the Takeover is a Public Company.
Letter b
Clearly sufficient.
Paragraph (2)
Letter a
What is meant by "Takeover price per share" is the transaction price at the time of the change of Controller.
Letter b
Clearly sufficient.
Letter c
Clearly sufficient.
Letter d
Clearly sufficient.
Letter e
In practice, beneficiaries are known as beneficial owners.
Letter f
What is meant by "affiliation" is affiliation as referred to in Law Number 8 of 1995 concerning the Capital Market.
Letter g
Clearly sufficient.

Article 8
Clearly sufficient.

Article 9
What is meant by "unless shareholder approval is required by specific legislation regulating the business field of the Public Company being taken over" includes among others acquisition or takeover regulations of a Public Company (bank) that require Takeovers to only be carried out with shareholder approval for banks in the form of Limited Liability Companies or similar meetings for banks in the form of other legal entities.

Article 10
Clearly sufficient.

Article 11
Clearly sufficient.

Article 12
Clearly sufficient.

Article 13
Paragraph (1)
Clearly sufficient.
Paragraph (2)
Clearly sufficient.
Paragraph (3)
Clearly sufficient.
Paragraph (4)
Letter a
Clearly sufficient.
Letter b
Announcements on the Stock Exchange website can be carried out if the Party carrying out the Takeover is a Public Company.

Article 14
Clearly sufficient.

Article 15
Clearly sufficient.

Article 16
Paragraph (1)
Clearly stated.
Paragraph (2)
Letter a
Clearly stated.
Letter b
Clearly stated.
Letter c
Clearly stated.
Letter d
Clearly stated.
Letter e
Clearly stated.
Letter f
The term "composition of share ownership from the New Controller before and after the Mandatory Tender Offer" includes the New Controller's indirect share ownership through a Party in which more than 50% (fifty percent) of the shares with fully paid-up voting rights are owned, either directly or indirectly, by the New Controller executing the Mandatory Tender Offer, thereby replacing the New Controller's obligation.

Article 17
Letter a
Number 1
The term "90 (ninety) days" refers to calendar days, so if calculated using trading days, the number is less than 90 (ninety) trading days.
In certain cases, there are shares that are less actively traded, and within a 90 (ninety) day period, there are only a few trading days.
In the event that there is no trading of the said shares on the Stock Exchange on a trading day, that Stock Exchange trading day is not included in the calculation.
As an example:
PT X plans to carry out a takeover of PT Y Tbk shares. PT Y Tbk shares are listed and traded on the Stock Exchange. In connection with the takeover of PT Y Tbk shares, PT X has announced the takeover of PT Y Tbk on May 15, 2017, so the average daily highest price of PT Y Tbk shares traded on the Stock Exchange during the 90 (ninety) days before May 15, 2017 is Rp. 5,539.77 per share, with the breakdown of the average highest trading price as follows:

No.	Day	Date	Highest Price	No.	Day	Date	Highest Price
1	Sunday	14-May-17	-	46	Thursday	30-Mar-17	Rp5,534.44
2	Saturday	13-May-17	-	47	Wednesday	29-Mar-17	Rp5,554.93
3	Friday	12-May-17	Rp5,698.96	48	Tuesday	28-Mar-17	Rp5,566.97
4	Thursday	11-May-17	Rp5,745.84	49	Monday	27-Mar-17	Rp5,557.24
5	Wednesday	10-May-17	Rp5,727.27	50	Sunday	26-Mar-17	-
6	Tuesday	09-May-17	Rp5,696.47	51	Saturday	25-Mar-17	-
7	Monday	08-May-17	Rp5,676.00	52	Friday	24-Mar-17	Rp5,518.48
8	Sunday	07-May-17	-	53	Thursday	23-Mar-17	Rp5,447.76
9	Saturday	06-May-17	-	54	Wednesday	22-Mar-17	Rp5,449.37
10	Friday	05-May-17	Rp5,686.82	55	Tuesday	21-Mar-17	Rp5,409.57
11	Thursday	04-May-17	Rp5,714.34	56	Monday	20-Mar-17	Rp5,415.72
12	Wednesday	03-May-17	Rp5,724.35	57	Sunday	19-Mar-17	-
13	Tuesday	02-May-17	Rp5,718.89	58	Saturday	18-Mar-17	-
14	Monday	01-May-17	Rp5,726.89	59	Friday	17-Mar-17	Rp5,405.23
15	Sunday	30-Apr-17	-	60	Thursday	16-Mar-17	Rp5,415.90
16	Saturday	29-Apr-17	-	61	Wednesday	15-Mar-17	Rp5,427.81
17	Friday	28-Apr-17	Rp5,696.30	62	Tuesday	14-Mar-17	Rp5,409.90
18	Thursday	27-Apr-17	Rp5,664.45	63	Monday	13-Mar-17	Rp5,410.21
19	Wednesday	26-Apr-17	Rp5,619.37	64	Sunday	12-Mar-17	-
20	Tuesday	25-Apr-17	Rp5,619.45	65	Saturday	11-Mar-17	-
21	Monday	24-Apr-17	Rp5,626.52	66	Friday	10-Mar-17	Rp5,431.17
22	Sunday	23-Apr-17	-	67	Thursday	09-Mar-17	Rp5,392.79
23	Saturday	22-Apr-17	-	68	Wednesday	08-Mar-17	Rp5,405.66
24	Friday	21-Apr-17	Rp5,631.50	69	Tuesday	07-Mar-17	Rp5,393.25
25	Thursday	20-Apr-17	Rp5,660.38	70	Monday	06-Mar-17	Rp5,391.63
26	Wednesday	19-Apr-17	Rp5,650.75	71	Sunday	05-Mar-17	-
27	Tuesday	18-Apr-17	Rp5,658.99	72	Saturday	04-Mar-17	-
28	Monday	17-Apr-17	Rp5,677.07	73	Friday	03-Mar-17	Rp5,373.41
29	Sunday	16-Apr-17	-	74	Thursday	02-Mar-17	Rp5,360.69
30	Saturday	15-Apr-17	-	75	Wednesday	01-Mar-17	Rp5,375.09
31	Friday	14-Apr-17	Rp5,677.72	76	Tuesday	28-Feb-17	Rp5,370.33
32	Thursday	13-Apr-17	Rp5,680.32	77	Monday	27-Feb-17	Rp5,395.27
33	Wednesday	12-Apr-17	Rp5,676.94	78	Sunday	26-Feb-17	-
34	Tuesday	11-Apr-17	Rp5,654.39	79	Saturday	25-Feb-17	-
35	Monday	10-Apr-17	Rp5,616.94	80	Friday	24-Feb-17	Rp5,409.56
36	Sunday	09-Apr-17	-	81	Thursday	23-Feb-17	Rp5,415.00
37	Saturday	08-Apr-17	-	82	Wednesday	22-Feb-17	Rp5,408.76
38	Friday	07-Apr-17	Rp5,606.02	83	Tuesday	21-Feb-17	Rp5,420.51
39	Thursday	06-Apr-17	Rp5,592.75	84	Monday	20-Feb-17	Rp5,419.21
40	Wednesday	05-Apr-17	Rp5,592.43	85	Sunday	19-Feb-17	-
41	Tuesday	04-Apr-17	Rp5,567.18	86	Saturday	18-Feb-17	-
42	Monday	03-Apr-17	Rp5,581.66	87	Friday	17-Feb-17	Rp5,417.10
43	Sunday	02-Apr-17	-	88	Thursday	16-Feb-17	Rp5,399.25
44	Saturday	01-Apr-17	-	89	Wednesday	15-Feb-17	Rp5,398.63
45	Friday	31-Mar-17	Rp5,576.67	90	Tuesday	14-Feb-17	Rp5,400.51

Letter a)
Clearly stated.

Letter b)
Clearly stated.
Letter c)
The term "information announcement" refers to an announcement mandated by the Financial Services Authority Regulation regarding the capital increase of a Public Company by granting pre-emptive rights or the Financial Services Authority Regulation regarding the capital increase of a Public Company without granting pre-emptive rights, where the announcement has disclosed information regarding the existence of a prospective New Controller in connection with the corporate action of the said capital increase. The average price of the highest daily trading prices on the Stock Exchange over the last 90 (ninety) days prior to the information announcement as referred to in the Financial Services Authority Regulation regarding the capital increase of a Public Company by granting pre-emptive rights, which has disclosed information regarding the prospective New Controller, is calculated as follows:
a. in the event that the information disclosure of the General Meeting of Shareholders in the context of capital increase by granting pre-emptive rights discloses information on the plan for a change in Controller as a result of the deposit of shares in forms other than cash, the average price of the highest daily trading prices on the Stock Exchange over the last 90 (ninety) days referred to is before the disclosure of such information; b. in the event that information in the context of capital increase by granting pre-emptive rights carried out simultaneously with the submission of the registration statement discloses information on the plan for a change in Controller, the average price of the highest daily trading prices on the Stock Exchange over the last 90 (ninety) days referred to is before the disclosure of such information; and
c. in the event that the plan for a change in Controller is disclosed at the time of the announcement of changes and/or additional information, the average price of the highest daily trading prices on the Stock Exchange over the last 90 (ninety) days referred to is before the announcement of such changes and/or additional information.

Letter d)
The term "information disclosure" refers to an announcement mandated by the Financial Services Authority Regulation regarding the capital increase of a Public Company by granting pre-emptive rights or the Financial Services Authority Regulation regarding the capital increase of a Public Company without granting pre-emptive rights, where the announcement has disclosed information regarding the existence of a prospective New Controller in connection with the corporate action of the said capital increase. Number 2 Clearly stated. Letter b Clearly stated. Letter c Clearly stated. Letter d Clearly stated.

Letter e
Clearly stated.
Letter f
Clearly stated.
Article 18
The term "timeframe for the execution of the Mandatory Tender Offer" is the first day the execution of the Mandatory Tender Offer begins.
As an example:
Company A has announced the negotiation of the takeover of Public Company B on January 2, 2018, and the execution of the Mandatory Tender Offer will begin on December 2, 2018. In this case, the date of December 2, 2018 exceeds the 6 (six) month limit after the announcement of the negotiation. Thus, the determination of the price is calculated using the average price of the highest daily trading prices on the Stock Exchange over the 90 (ninety) days before June 2, 2018.

Article 19
Clearly stated.
Article 20
Clearly stated.
Article 21
Paragraph (1)
The term "public" refers to Parties that are not affiliated parties of the New Controller. Affiliated parties are Parties that have an affiliation relationship as referred to in Law Number 8 of 1995 concerning the Capital Market, except for employees of the New Controller. Paragraph (2) Clearly stated.

Paragraph (3)
Clearly stated.
Paragraph (4)
Clearly stated.
Article 22
Clearly stated.
Article 23
Letter a
Clearly stated.
Letter b
Clearly stated.
Letter c
Example: A takeover occurs due to the execution of duties and authority by a government or state body or institution based on Law, including Takeovers that occur due to the rescue of a bank by the Deposit Insurance Agency. Letter d Clearly stated. Letter e Clearly stated. Letter f Clearly stated. Letter g Clearly stated. Letter h Clearly stated. Letter i The term "acquisition of shares by shareholders exercising their rights according to their share ownership proportion" refers to the acquisition of shares resulting from the exercise of pre-emptive rights (HMETD), obtained by shareholders from the Public Company and not from the purchase of HMETD or the transfer of HMETD from other shareholders.

Letter j
Clearly stated.
Letter k
The implementation of policies by government or state bodies or institutions must be based on a written statement from the relevant government or state body or institution.
Letter l
Clearly stated.
Letter m
Clearly stated.
Letter n
The term "prospectus for the public offering of equity securities" is the prospectus of the Public Company to be taken over.
Article 24
Clearly stated.
Article 25
Clearly stated.
Article 26
Clearly stated.
Article 27
Example:
Mr. A carries out a Takeover of Public Company X.
Public Company X is the Controller of Public Company Z. Thus, Mr. A is required to carry out a Mandatory Tender Offer for the remaining shares of Public Company X.
Whereas for Public Company Z, if the income contribution of Public Company Z to Public Company X is less than 50%, then Mr. A is exempted from carrying out a Mandatory Tender Offer for Public Company Z. However, if the income contribution of Public Company Z to Public Company X is equal to or more than 50%, then Mr. A is required to carry out a Mandatory Tender Offer for the remaining shares of Public Company Z.

Article 28
Paragraph (1)
Letter a
Clearly stated.
Letter b
Announcements on the Stock Exchange website can be made in the event that the Party carrying out the Takeover is a Public Company.
Paragraph (2)
Clearly stated.
Paragraph (3)
Clearly stated.
Paragraph (4)
Clearly stated.
Article 29
Clearly stated.
Article 30
Clearly stated.
Article 31
Clearly stated.
Article 32
Clearly stated.
Article 33
Clearly stated.

Article 34
The term "specific actions" includes, among others:
a. postponement of the issuance of an effectiveness statement, for example, an effectiveness statement for business merger and business consolidation; and b. postponement of the issuance of a Financial Services Authority statement that there are no further responses to documents submitted to the Financial Services Authority in the context of capital increase by granting pre-emptive rights (HMETD) of a Public Company.
Article 35
Clearly stated.
Article 36
Clearly stated.
Article 37
Clearly stated.
Article 38
Clearly stated.
Article 39
Clearly stated.
Article 40
Clearly stated.
SUPPLEMENT TO THE STATE GAZETTE OF THE REPUBLIC OF INDONESIA NUMBER 6228