FINANCIAL SERVICES AUTHORITY REGULATION

NUMBER 60 /POJK.04/2016

THE BOARD OF DIRECTORS AND BOARD OF COMMISSIONERS OF THE DEPOSITORY AND CLEARING INSTITUTION

BY THE GRACE OF GOD THE ALMIGHTY,

THE COMMISSIONERS OF THE FINANCIAL SERVICES AUTHORITY,

Considering: that in order to improve good corporate governance of the Depository and Clearing Institution that is globally competitive, as well as to improve the competence and integrity of the Board of Directors and Board of Commissioners of the Depository and Clearing Institution, it is necessary to perfect regulations regarding the Board of Directors and Board of Commissioners of the Depository and Clearing Institution by establishing a Financial Services Authority Regulation on the Board of Directors and Board of Commissioners of the Depository and Clearing Institution;

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);

FINANCIAL SERVICES AUTHORITY
REPUBLIC OF INDONESIA

COPY

DECIDES:

To establish: FINANCIAL SERVICES AUTHORITY REGULATION ON THE BOARD OF DIRECTORS AND BOARD OF COMMISSIONERS OF THE DEPOSITORY AND CLEARING INSTITUTION.

CHAPTER I

GENERAL PROVISIONS

Article 1

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

Board of Directors is an organ of the Depository and Clearing Institution that has the authority and is fully responsible for the management of the Depository and Clearing Institution for the interests of the Depository and Clearing Institution, in accordance with the purpose and objectives of the Depository and Clearing Institution and represents the Depository and Clearing Institution, both in and out of court, in accordance with the provisions of the Articles of Association.
Board of Commissioners is an organ of the Depository and Clearing Institution tasked with conducting general and/or specific supervision in accordance with the Articles of Association and providing advice to the Board of Directors.
Depository and Clearing Institution is a Party that conducts Central Custodian activities for Custodian Banks, Securities Companies, and other Parties.
Remuneration Committee is an ad hoc committee formed by and responsible to the Board of Commissioners to assist in implementing the functions and duties of the Board of Commissioners to review and propose salaries and other benefits for members of the Board of Directors, as well as honoraria including the method of determination, for members of the Board of Commissioners.
Competency and Propriety Assessment Committee is an ad hoc committee formed by the Executive Head of the Capital Market Supervision of the Financial Services Authority to conduct competency and propriety assessments of candidates for members of the Board of Directors and members of the Board of Commissioners of the Depository and Clearing Institution.
General Meeting of Shareholders, hereinafter abbreviated as GMS, is an organ of the Depository and Clearing Institution that has authority not delegated to the Board of Directors or Board of Commissioners within the limits determined in Law Number 40 of 2007 concerning Limited Liability Companies and/or the Articles of Association.

CHAPTER II

BOARD OF DIRECTORS OF THE DEPOSITORY AND CLEARING INSTITUTION

First Section

Membership of the Board of Directors

Article 2

(1) The Depository and Clearing Institution must have at least 2 (two) members of the Board of Directors.

(2) One of the members of the Board of Directors of the Depository and Clearing Institution must be designated as the Chief Executive Director of the Depository and Clearing Institution with main duties at least:
a. making final decisions if the Board of Directors meeting cannot make a decision; and b. coordinating activities at the Depository and Clearing Institution, public relations activities, legal and regulatory activities, and internal audit activities.

(3) Members of the Board of Directors of the Depository and Clearing Institution other than the Chief Executive Director must be designated as members of the Board of Directors of the Depository and Clearing Institution who are at least responsible for 1 (one) or more of the following activities:
a. clearing; b. custodian services;
c. research and development;
d. information technology; e. law; and f. finance and human resources as well as general administration.

Article 3

(1) The Board of Directors of the Depository and Clearing Institution must submit the schedule and agenda of the GMS regarding the appointment of members of the Board of Directors of the Depository and Clearing Institution to the Financial Services Authority at the latest 121 (one hundred twenty-one) days before the GMS for the appointment of members of the Board of Directors of the Depository and Clearing Institution.

(2) The Board of Commissioners of the Depository and Clearing Institution reviews the number of needs and positions of members of the Board of Directors of the Depository and Clearing Institution and submits them to the Financial Services Authority at the latest 116 (one hundred sixteen) days before the GMS for the appointment of members of the Board of Directors of the Depository and Clearing Institution.

(3) In reviewing the number of needs and positions of members of the Board of Directors of the Depository and Clearing Institution, the Board of Commissioners may form a committee with or without involving third parties, guided by this Financial Services Authority Regulation, legislation in the Capital Market sector regulating the Licensing of Depository and Clearing Institutions and the organizational structure of the Depository and Clearing Institution.

(4) In determining the positions of members of the Board of Directors of the Depository and Clearing Institution, the Board of Commissioners must pay attention to the activities that are the responsibility of each position of members of the Board of Directors of the Depository and Clearing Institution as referred to in Article 2 paragraph (2) and paragraph (3).

(5) If within the submission time limit as referred to in paragraph (2), the Board of Commissioners has not submitted the number of needs and positions of members of the Board of Directors of the Depository and Clearing Institution, the Financial Services Authority has the authority to directly determine the number of needs and positions of members of the Board of Directors of the Depository and Clearing Institution.

(6) The Financial Services Authority has the authority to determine the number of needs and positions of members of the Board of Directors of the Depository and Clearing Institution at the latest 106 (one hundred six) days before the GMS for the appointment of members of the Board of Directors of the Depository and Clearing Institution.

(7) If by the time limit as referred to in paragraph (6), the Financial Services Authority has not determined the number of needs and positions of members of the Board of Directors of the Depository and Clearing Institution, the number of needs and positions of members of the Board of Directors of the Depository and Clearing Institution from the previous period shall apply.

Article 4

Taking into account the development of activities and operational needs of the Depository and Clearing Institution, the Financial Services Authority may add members of the Board of Directors of the Depository and Clearing Institution to the Board of Directors of the Depository and Clearing Institution currently in office.

Second Section

Requirements for Members of the Board of Directors and Composition of the Board of Directors

Article 5

Members of the Board of Directors of the Depository and Clearing Institution must meet the following requirements:
a. integrity includes:

individual Indonesian citizens who are competent to perform legal acts;
having good character and morality;
never declared bankrupt or being a member of the Board of Commissioners and/or Board of Directors who was declared guilty or partly guilty causing a company to be declared bankrupt;
never sentenced for proven criminal offenses within a certain period before nomination;
never committing disgraceful acts proven by submitting at least a Police Record Certificate where the period from the date of issuance to submission to the Financial Services Authority is not more than 6 (six) months or in accordance with the validity period given by the police if less than 6 (six) months;
never committing material violations of legislation in the financial services sector; and
having a commitment to the development of the Depository and Clearing Institution and the Indonesian Capital Market; and
b. competence includes:
having an understanding of legislation in the Capital Market field and broad knowledge about the Capital Market including international Capital Market developments;
understanding good corporate governance principles and risk management principles; and
having sufficient background and/or experience.

Article 6

Based on the requirements as referred to in Article 5 letter b number 3, members of the Board of Directors of the Depository and Clearing Institution must meet the following provisions:
a. at least one member of the Board of Directors of the Depository and Clearing Institution must have experience in a managerial position in risk management and/or investment management at a financial company or a managerial position overseeing custodian services at least 1 (one) level below Board of Directors members at a Custodian Bank, for at least 5 (five) years; b. other members of the Board of Directors of the Depository and Clearing Institution must have experience in:

Board of Directors member position at a financial company for at least 5 (five) years;
managerial position in information technology for at least 3 (three) years and having sufficient knowledge regarding information systems of companies operating in the financial sector;
managerial position at least 1 (one) level below Board of Directors members or equivalent positions at Capital Market supervisory institutions and/or organizations authorized by Law Number 8 of 1995 concerning the Capital Market to regulate the implementation of their activities, for at least 3 (three) years; and/or
experience as a professional in the fields of law, accounting, or finance actively practicing in the Capital Market, for at least 5 (five) years; and
c. the duration or period of experience of members of the Board of Directors of the Depository and Clearing Institution as referred to in letter a and letter b is calculated until the date of the GMS for the appointment of members of the Board of Directors of the Depository and Clearing Institution.

Article 7

Members of the Board of Directors of the Depository and Clearing Institution nominated as the Chief Executive Director of the Depository and Clearing Institution must have strong leadership qualities.

Third Section

Procedure for Nomination and Submission of Board of Directors Members

Article 8

(1) Nomination and submission of candidates for members of the Board of Directors of the Depository and Clearing Institution are conducted by shareholders or groups of shareholders of the Depository and Clearing Institution holding at least 20% (twenty percent) of the issued shares with voting rights.

(2) In the nomination of members of the Board of Directors of the Depository and Clearing Institution, shareholders or groups of shareholders meeting the requirements as referred to in paragraph (1) are jointly responsible for:
a. searching for and selecting candidates for members of the Board of Directors of the Depository and Clearing Institution as referred to in Article 2; b. investigating that each candidate for members of the Board of Directors of the Depository and Clearing Institution has the expertise, experience, and responsibility for each position and activity that is the duty of the position as referred to in Article 2, Article 5, Article 6, and Article 7; and
c. recommending salaries and other benefits for each candidate for members of the Board of Directors of the Depository and Clearing Institution by considering the proposal of the Remuneration Committee (if any).

(3) Candidates for members of the Board of Directors of the Depository and Clearing Institution must be submitted to the Financial Services Authority by shareholders or groups of shareholders as referred to in paragraph (1), in 1 (one) complete package of candidates for the Board of Directors of the Depository and Clearing Institution meeting the position provisions as referred to in Article 2, Article 5, Article 6, and Article 7.

(4) The package submission as referred to in paragraph (3) does not apply to the submission of candidates for members of the Board of Directors of the Depository and Clearing Institution to fill vacant Board of Directors positions or to add candidates for members of the Board of Directors of the Depository and Clearing Institution.

Article 9

(1) In submitting candidates for members of the Board of Directors of the Depository and Clearing Institution to the Financial Services Authority, shareholders or groups of shareholders as referred to in Article 8 paragraph (1) must attach in duplicate 2 (two) sets of documents as follows:
a. curriculum vitae of candidates for members of the Board of Directors of the Depository and Clearing Institution; b. photocopy of the ID card of candidates for members of the Board of Directors of the Depository and Clearing Institution;
c. photocopy of diplomas and expertise certificates demonstrating the expertise of candidates for members of the Board of Directors of the Depository and Clearing Institution (if any);
d. a statement letter from each Party nominated as a candidate for members of the Board of Directors of the Depository and Clearing Institution containing at least:

a statement that the nominee has met the provisions of Article 5 to Article 7;
a statement regarding the existence or non-existence of Affiliation between candidates for members of the Board of Directors of the Depository and Clearing Institution with other candidates for members of the Board of Directors of the Depository and Clearing Institution, members of the Board of Commissioners of the Depository and Clearing Institution, Securities Companies, and Custodian Banks that are participants or users of services of the Depository and Clearing Institution in the submitted package;
willingness to unconditionally follow the competency and propriety assessment process conducted by the Financial Services Authority and willingness to be selected as a candidate for members of the Board of Directors of the Depository and Clearing Institution by the Financial Services Authority for positions as referred to in Article 2 paragraph (2) and paragraph (3), which are different from the positions proposed by shareholders or groups of shareholders of the Depository and Clearing Institution as referred to in Article 8 paragraph (1);
willingness to be appointed as members of the Board of Directors of the Depository and Clearing Institution by the GMS responsible for the activities that are their duties and to work together as best as possible with members of the Board of Commissioners and other members of the Board of Directors of the Depository and Clearing Institution in the implementation of orderly, fair, and efficient activities of the Depository and Clearing Institution;
a statement that they do not hold concurrent positions as board of directors members, board of commissioners members, or employees at other companies or institutions, if the nominee is selected as a member of the Board of Directors of the Depository and Clearing Institution;
a statement that candidates for members of the Board of Directors of the Depository and Clearing Institution, after becoming members of the Board of Directors of the Depository and Clearing Institution, will not use the assets of the Depository and Clearing Institution or conduct transactions and provide benefits in any form to Affiliates of candidates for members of the Board of Directors of the Depository and Clearing Institution, other members of the Board of Directors of the Depository and Clearing Institution, Affiliates of other members of the Board of Directors of the Depository and Clearing Institution, members of the Board of Commissioners of the Depository and Clearing Institution, and/or Affiliates of members of the Board of Commissioners of the Depository and Clearing Institution; and
a statement at least:
a) willingness to not own shares or be a controller, either directly or indirectly, of Securities Companies during their term as members of the Board of Directors of the Depository and Clearing Institution at the latest 6 (six) months after the GMS for the appointment of members of the Board of Directors of the Depository and Clearing Institution and during that period the nominee is willing to not have voting rights in the GMS; b) willingness to not control, either directly or indirectly, Issuers or Public Companies; and/or c) willingness to not trade shares of Issuers or Public Companies owned by them until 6 (six) months after the end of their term of office; e. Police Record Certificate; f. answers to questions as contained in the Appendix which is an integral part of this Financial Services Authority Regulation; g. latest color passport photos size 10x15 cm with red background totaling 3 (three) sheets; h. a letter of explanation regarding the process of searching, selecting, and investigating candidates for members of the Board of Directors of the Depository and Clearing Institution from shareholders or groups of shareholders of the Depository and Clearing Institution as referred to in Article 8 paragraph (1), including recommendations regarding salaries and other benefits if candidates for members of the Board of Directors of the Depository and Clearing Institution are appointed as members of the Board of Directors of the Depository and Clearing Institution, stating that the process has been conducted professionally and there are no other interests including interests due to Affiliation relationships, but only for the interests of the Depository and Clearing Institution specifically and the Capital Market in general; and
i. strategic plan of candidates for members of the Board of Directors of the Depository and Clearing Institution that aligns with the vision and mission of the Depository and Clearing Institution.

(2) The submission of names of candidates for members of the Board of Directors of the Depository and Clearing Institution by shareholders or groups of shareholders of the Depository and Clearing Institution as referred to in Article 8 paragraph (1) and paragraph (3) along with supporting documents as referred to in paragraph (1) must meet the requirements and be accepted completely by the Financial Services Authority at the latest 56 (fifty-six) days before the GMS for the appointment of members of the Board of Directors of the Depository and Clearing Institution.

Fourth Section

Competency and Propriety Assessment of Candidates for Board of Directors Members

Article 10

(1) Every candidate for members of the Board of Directors of the Depository and Clearing Institution submitted must undergo a competency and propriety assessment conducted by the Competency and Propriety Assessment Committee.

(2) Members of the Competency and Propriety Assessment Committee as referred to in paragraph (1) consist of 5 (five) people, namely a Deputy Commissioner as chairman concurrently a member, and 4 (four) officials at least at the director level as members.

(3) Every implementation of competency and propriety assessment must be attended by at least 3 (three) members of the Competency and Propriety Assessment Committee.

(4) The Competency and Propriety Assessment Committee conducts competency and propriety assessments of candidates for members of the Board of Directors of the Depository and Clearing Institution at least through administrative research and interviews, and/or presentation requests that at least include strategic plans for the future development of the Depository and Clearing Institution.

(5) The Competency and Propriety Assessment Committee conducts competency and propriety assessments on every candidate for members of the Board of Directors of the Depository and Clearing Institution individually according to the proposed position.

(6) If necessary, the Competency and Propriety Assessment Committee may conduct competency and propriety assessments on candidates for members of the Board of Directors of the Depository and Clearing Institution as referred to in paragraph (5) for other positions of members of the Board of Directors of the Depository and Clearing Institution.

(7) In conducting competency and propriety assessments of candidates for members of the Board of Directors of the Depository and Clearing Institution, the Competency and Propriety Assessment Committee may be assisted by resource persons with specific expertise from outside the Financial Services Authority.

Article 11

(1) Competency and propriety assessment is conducted to determine and assess that candidates for members of the Board of Directors of the Depository and Clearing Institution meet the requirements as referred to in Article 5 to Article 7 and are the best candidates to hold each position of members of the Board of Directors of the Depository and Clearing Institution.

(2) The Competency and Propriety Assessment Committee in conducting competency and propriety assessments of candidates for members of the Board of Directors of the Depository and Clearing Institution for each position must pay attention to the composition of candidates for members of the Board of Directors of the Depository and Clearing Institution as referred to in Article 6.

Article 12

The Financial Services Authority has the authority to stop the nomination process for candidates for members of the Board of Directors of the Depository and Clearing Institution if the candidate is undergoing legal proceedings.

Article 13

The Executive Head of Capital Market Supervision establishes candidates for members of the Board of Directors of the Depository and Clearing Institution for each position by considering the results of the competency and propriety assessment conducted by the Competency and Propriety Assessment Committee.

Article 14

Based on the results of the competency and propriety assessment as referred to in Article 10 paragraph (4), paragraph (5), and paragraph (6), the Financial Services Authority may determine the position of candidates for members of the Board of Directors of the Depository and Clearing Institution to be different from the position proposed by shareholders or groups of shareholders as referred to in Article 8 paragraph (1).

Article 15

(1) In the event that there are no selected candidates for members of the Board of Directors of the Depository and Clearing Institution from the results of the competency and propriety assessment as referred to in Article 10 paragraph (4) for 1 (one) or more positions of members of the Board of Directors, the Financial Services Authority submits to each shareholder or group of shareholders as referred to in Article 8 paragraph (1) to submit other candidates for members of the Board of Directors of the Depository and Clearing Institution for the position where the candidate has not been selected by the Financial Services Authority in the competency and propriety assessment process, at the latest 35 (thirty-five) days after the application meets the requirements and is accepted completely by the Financial Services Authority.

(2) Shareholders or groups of shareholders of the Depository and Clearing Institution as referred to in Article 8 paragraph (1) may submit other candidates for members of the Board of Directors of the Depository and Clearing Institution for the position where the candidate has not been selected by the Financial Services Authority as referred to in paragraph (1), to the Financial Services Authority at the latest 14 (fourteen) days before the GMS for the appointment of members of the Board of Directors of the Depository and Clearing Institution, meeting the provisions in Article 5, Article 6, Article 7, Article 8, and Article 9 paragraph (1).

(3) The Financial Services Authority conducts competency and propriety assessment on other candidates for members of the Board of Directors of the Depository and Clearing Institution as referred to in paragraph (1).

Article 16

(1) If all documents as referred to in Article 9 paragraph (1) are complete and candidates for members of the Board of Directors have met the requirements, the Financial Services Authority submits the list of selected candidates for members of the Board of Directors of the Depository and Clearing Institution for each position of members of the Board of Directors along with photocopies of the documents of candidates for members of the Board of Directors of the Depository and Clearing Institution to the Board of Directors of the Depository and Clearing Institution

no later than 7 (seven) days before the General Meeting of Shareholders (GMS) for the appointment of members of the Board of Directors of the Clearing and Settlement Institution.
(2) The Board of Directors of the Clearing and Settlement Institution is required to submit to all shareholders, a list of candidates for members of the Board of Directors of the Clearing and Settlement Institution along with complete photocopies of documents as referred to in paragraph (1) no later than 1 (one) business day after receiving the list of candidates for members of the Board of Directors of the Clearing and Settlement Institution from the Financial Services Authority. (3) The list of candidates for members of the Board of Directors of the Clearing and Settlement Institution along with complete photocopies of documents as referred to in paragraph (2) must be available and accessible to shareholders and the public.

Fifth Section
GMS and Procedures for Appointment of Board of Directors Members

Article 17
(1) Announcement regarding the convening of a GMS for the appointment of members of the Board of Directors of the Clearing and Settlement Institution must be made no later than 14 (fourteen) days before the convening of the GMS, containing at least the plan for the appointment of members of the Board of Directors of the Clearing and Settlement Institution. (2) The convening of the GMS of the Clearing and Settlement Institution to appoint members of the Board of Directors of the Clearing and Settlement Institution must be made no later than 14 (fourteen) days before the said GMS, not counting the date of convening and the date of the GMS, containing at least the plan for the appointment of members of the Board of Directors of the Clearing and Settlement Institution.

Article 18
(1) The appointment of members of the Board of Directors of the Clearing and Settlement Institution is carried out by the GMS based on candidate members of the Board of Directors selected by the Financial Services Authority according to their respective positions as referred to in Article 16 paragraph (1). (2) The procedure for appointing candidates for members of the Board of Directors of the Clearing and Settlement Institution as referred to in paragraph (1) also applies to the appointment of candidates for members of the Board of Directors of the Clearing and Settlement Institution to fill vacant positions of members of the Board of Directors of the Clearing and Settlement Institution or to add candidates for members of the Board of Directors of the Clearing and Settlement Institution. (3) The GMS to appoint members of the Board of Directors of the Clearing and Settlement Institution must be chaired by the Lead Commissioner or one of the members of the Board of Commissioners in the event that the Lead Commissioner is unable to attend.

Article 19
(1) At the time of the GMS for the appointment of members of the Board of Directors of the Clearing and Settlement Institution, candidate members of the Board of Directors determined by the Financial Services Authority must explain their strategic plan to the shareholders.
(2) The explanation may also be delivered in other forums before the GMS that allow shareholders to interact with candidate members of the Board of Directors of the Clearing and Settlement Institution.

Article 20
The GMS approves and determines the salary and other benefits for members of the Board of Directors of the Clearing and Settlement Institution proposed by the shareholders or group of shareholders of the Clearing and Settlement Institution as referred to in Article 8 paragraph (1).

Sixth Section
Prohibitions for Board of Directors Members

Article 21
(1) Members of the Board of Directors of the Clearing and Settlement Institution are prohibited from having an Affiliation relationship with other members of the Board of Directors of the Clearing and Settlement Institution and/or members of the Board of Commissioners of the Clearing and Settlement Institution. (2) Members of the Board of Directors of the Clearing and Settlement Institution are prohibited from holding shares or acting as controllers, directly or indirectly, of a Securities Company. (3) In the event that a member of the Board of Directors of the Clearing and Settlement Institution holds shares or acts as a controller, directly or indirectly, of a Securities Company, such shares must be transferred no later than 6 (six) months since the GMS for the appointment of members of the Board of Directors of the Clearing and Settlement Institution, and during that period, the concerned individual is prohibited from exercising voting rights in the GMS of the said Securities Company. (4) Members of the Board of Directors of the Clearing and Settlement Institution are prohibited from controlling, directly or indirectly, an Issuer or Public Company and/or are prohibited from trading shares of an Issuer or Public Company. (5) In the event that a member of the Board of Directors of the Clearing and Settlement Institution appointed by the GMS already holds shares of an Issuer or Public Company, such shares cannot be traded until 6 (six) months after the term of office has ended. (6) Members of the Board of Directors of the Clearing and Settlement Institution are prohibited from holding concurrent positions as board members, commissioners, or employees of other companies or institutions in any capacity.

Seventh Section
Term of Office of Board of Directors Members

Article 22
(1) The term of office of members of the Board of Directors of the Clearing and Settlement Institution is 3 (three) years calculated from the GMS for the appointment of members of the Board of Directors of the Clearing and Settlement Institution until the closing of the GMS in the third year, and may only be reappointed for 1 (one) term of office, with the following provisions:
a. if a member of the Board of Directors of the Clearing and Settlement Institution is appointed to fill a vacant position of a member of the Board of Directors of the Clearing and Settlement Institution or to add candidates for members of the Board of Directors of the Clearing and Settlement Institution, the term of office of such member of the Board of Directors of the Clearing and Settlement Institution applies for the remaining term of office of the currently serving member of the Board of Directors of the Clearing and Settlement Institution; b. the calculation of 1 (one) term of office for a member of the Board of Directors of the Clearing and Settlement Institution is if the concerned individual serves for at least 2/3 (two-thirds) of the term of office of the Board of Directors of the Clearing and Settlement Institution; and
c. the total term of office of members of the Board of Directors on the Stock Exchange, Clearing and Guarantee Institution, and Clearing and Settlement Institution is at most 3 (three) terms of office.
(2) The end of the term of office of the Board of Directors of the Clearing and Settlement Institution must be regulated differently from the end of the term of office of the Board of Commissioners of the Clearing and Settlement Institution.

Article 23
(1) In the event that a member of the Board of Directors of the Clearing and Settlement Institution no longer meets the requirements as referred to in Article 5 through Article 7, the following provisions apply:
a. such member of the Board of Directors of the Clearing and Settlement Institution must be replaced within a period of no later than 3 (three) months since the concerned individual is declared by the Financial Services Authority to no longer meet the requirements; b. shareholders or groups of shareholders of the Clearing and Settlement Institution meeting the requirements as referred to in Article 8 paragraph (1) must immediately submit candidates for replacement members of the Board of Directors of the Clearing and Settlement Institution to the Financial Services Authority according to the procedures as referred to in Article 8 and Article 9; and
c. candidate members of the Board of Directors of the Clearing and Settlement Institution replacements must meet Article 5 through Article 7.
(2) In the event that there are vacant positions of members of the Board of Directors of the Clearing and Settlement Institution, the following provisions apply:
a. the position of members of the Board of Directors of the Clearing and Settlement Institution must be filled within a period of no later than 3 (three) months since the position of members of the Board of Directors of the Clearing and Settlement Institution becomes vacant; and b. shareholders or groups of shareholders of the Clearing and Settlement Institution as referred to in Article 8 paragraph (1) must immediately submit candidates for members of the Board of Directors of the Clearing and Settlement Institution to fill the vacant positions to the Financial Services Authority according to the procedures as referred to in Article 5, Article 6, Article 7, and Article 9.

(3) In the event that:
a. the position of the Chief Director of the Clearing and Settlement Institution becomes vacant, one of the members of the Board of Directors of the Clearing and Settlement Institution must be appointed based on a decision of the Board of Directors of the Clearing and Settlement Institution acting as an acting official to carry out the duties and authorities of the vacant Chief Director position until a replacement is appointed, after obtaining approval from the Board of Commissioners; b. the position of members of the Board of Directors of the Clearing and Settlement Institution other than the Chief Director becomes vacant, the duties and authorities of such members of the Board of Directors must be transferred to other members of the Board of Directors of the Clearing and Settlement Institution based on a Board of Directors meeting decision until a replacement is appointed, after obtaining approval from the Board of Commissioners; and
c. the temporary appointment of the Chief Director of the Clearing and Settlement Institution or the transfer of duties and authorities of members of the Board of Directors of the Clearing and Settlement Institution must be reported by the Board of Directors of the Clearing and Settlement Institution to the Financial Services Authority no later than 2 (two) days after the appointment or transfer.
(4) The Financial Services Authority may determine that vacant positions of members of the Board of Directors of the Clearing and Settlement Institution as determined in paragraph (2) do not need to be filled after considering the development of activities and operations of the Clearing and Settlement Institution. (5) The time limit for replacement and/or filling of members of the Board of Directors of the Clearing and Settlement Institution as referred to in paragraph (1) and paragraph (2) may be determined otherwise by the Financial Services Authority.

(6) In the event that there are vacant positions of members of the Board of Directors of the Clearing and Settlement Institution or in the event of the resignation of members of the Board of Directors of the Clearing and Settlement Institution, the Board of Directors of the Clearing and Settlement Institution is required to report to the Financial Services Authority no later than 5 (five) business days from when it is known or upon receipt of the resignation letter by the Board of Directors of the Clearing and Settlement Institution. (7) In filling vacant positions of members of the Board of Directors of the Clearing and Settlement Institution and/or the need for additional members of the Board of Directors of the Clearing and Settlement Institution, the following provisions apply:
a. filling and/or adding members of the Board of Directors of the Clearing and Settlement Institution must meet the provisions as regulated in Article 5 through Article 9; b. candidate members of the Board of Directors of the Clearing and Settlement Institution to be submitted must be willing to cooperate with existing members of the Board of Directors of the Clearing and Settlement Institution; and
c. adding new members of the Board of Directors of the Clearing and Settlement Institution must consider the provisions as referred to in Article 4, and its implementation must meet the provisions as referred to in Article 5 through Article 9.

Article 24
The term of office of members of the Board of Directors of the Clearing and Settlement Institution ends automatically if:
a. losing Indonesian citizenship; b. incapable of performing legal acts;
c. declared bankrupt or becoming a member of the Board of Commissioners and/or members of the Board of Directors who are declared guilty or complicit in causing a company to be declared bankrupt;
d. sentenced for proven criminal acts; e. permanently unable to perform duties; f. deceased; and/or g. term of office ends.

Article 25
(1) Members of the Board of Directors of the Clearing and Settlement Institution may be dismissed from their positions by the Financial Services Authority if:
a. lacking good ethics and morality; b. committing disgraceful acts in the financial services sector;
c. committing material violations of laws and regulations in the financial services sector;
d. lacking commitment to the development of the Clearing and Settlement Institution; and/or e. failing or being incapable of performing duties.
(2) In the event that the Financial Services Authority temporarily dismisses and/or there is a vacancy of all members of the Board of Directors of the Clearing and Settlement Institution, the Head of the Capital Market Supervisory Executive of the Financial Services Authority may appoint and determine the Board of Commissioners of the Clearing and Settlement Institution to carry out the functions of the Board of Directors of the Clearing and Settlement Institution until new members of the Board of Directors are appointed by the GMS. (3) In the event that there are no members of the Board of Commissioners of the Clearing and Settlement Institution who can carry out the functions of the Board of Directors of the Clearing and Settlement Institution as referred to in paragraph (2), based on the proposal of the Head of the Capital Market Supervisory Executive, the Commissioners of the Financial Services Authority may appoint and determine other parties as interim management of the Clearing and Settlement Institution.

Article 26
(1) The distribution of duties as referred to in Article 2 paragraph (2) and paragraph (3) must be established in the organizational structure of the Clearing and Settlement Institution and the job descriptions of the Clearing and Settlement Institution.
(2) The determination and/or change of the organizational structure of the Clearing and Settlement Institution up to 1 (one) level below the members of the Board of Directors must obtain approval from the Financial Services Authority.

Article 27
In the event that the Board of Directors of the Clearing and Settlement Institution considers that members of the Board of Directors of the Clearing and Settlement Institution responsible for and carrying out tasks for several activities as determined at the time of appointment, cannot carry out part of their tasks, based on a Board of Directors meeting decision, part of their tasks may be transferred to other members of the Board of Directors of the Clearing and Settlement Institution who are considered capable of performing the tasks after obtaining approval from the Board of Commissioners and the Financial Services Authority.

Article 28
Members of the Board of Directors of the Clearing and Settlement Institution who no longer serve as members of the Board of Directors of the Clearing and Settlement Institution for any reason, are not entitled to receive salary and other benefits from the Clearing and Settlement Institution except for rights to compensation or honorarium as long as approved by the GMS, with the provision that the amount of such compensation or honorarium is not greater than the amount of salary for the remaining term of office.

CHAPTER III
BOARD OF COMMISSIONERS OF THE CLEARING AND SETTLEMENT INSTITUTION

First Section
Membership of the Board of Commissioners

Article 29
(1) The Clearing and Settlement Institution must have at least 2 (two) members of the Board of Commissioners.
(2) One of the members of the Board of Commissioners of the Clearing and Settlement Institution must be designated as the Lead Commissioner.

Article 30
(1) The Board of Directors of the Clearing and Settlement Institution must submit the schedule and agenda of the GMS for the appointment of members of the Board of Commissioners of the Clearing and Settlement Institution to the Financial Services Authority no later than 60 (sixty) days before the GMS for the appointment of members of the Board of Commissioners of the Clearing and Settlement Institution. (2) The Financial Services Authority has the authority to determine the number of requirements for members of the Board of Commissioners of the Clearing and Settlement Institution no later than 50 (fifty) days before the GMS for the appointment of members of the Board of Commissioners of the Clearing and Settlement Institution. (3) If by the time limit as referred to in paragraph (2) the Financial Services Authority has not determined the number of requirements for members of the Board of Commissioners of the Clearing and Settlement Institution, the number of requirements for members of the Board of Commissioners of the Clearing and Settlement Institution from the previous period applies. (4) Considering the development of activities and operational needs of the Clearing and Settlement Institution, the Financial Services Authority may add members of the Board of Commissioners of the Clearing and Settlement Institution to the Board of Commissioners of the Clearing and Settlement Institution currently serving.

Second Section
Requirements for Members of the Board of Commissioners and Composition of the Board of Commissioners

Article 31
Members of the Board of Commissioners of the Clearing and Settlement Institution must meet the following requirements:
a. integrity includes:

individual Indonesian citizens capable of performing legal acts;
having good ethics and morality;
never declared bankrupt or becoming a member of the Board of Commissioners and/or members of the Board of Directors who are declared guilty or complicit in causing a company to be declared bankrupt;
never sentenced for proven criminal acts within a certain period before being nominated;
never committing disgraceful acts proven by submitting at least a Police Record Letter where the period from the date of issuance to submission to the Financial Services Authority is no more than 6 (six) months or according to the validity period provided by the police if less than 6 (six) months;
never committing material violations of laws and regulations in the financial services sector; and
having commitment to the development of the Clearing and Settlement Institution and the Indonesian Capital Market; and

b. competence includes:

having understanding of laws and regulations in the field of Capital Market and broad knowledge about the Capital Market;
understanding good corporate governance principles and risk management principles; and
having sufficient background and/or experience.

Article 32
(1) Based on the requirements as referred to in Article 31 letter b number 3, members of the Board of Commissioners of the Clearing and Settlement Institution must meet the following provisions:
a. experienced in the position of board members at a Securities Company for at least 2 (two) years; b. experienced in the position of board members at a Custodian Bank or Securities Administration Office for at least 2 (two) years;
c. experienced in managerial positions at Capital Market institutions for at least 5 (five) years or previously held leadership positions at financial services regulatory institutions;
d. experienced in the position of directors at organizations authorized by Law Number 8 of 1995 concerning Capital Market to regulate the implementation of their activities for at least 2 (two) years; or e. being professionals in the fields of law, accounting, or finance practicing actively in the Capital Market field for at least 5 (five) years. (2) The composition of the Board of Commissioners is regulated as follows:
a. in the event that the number of members of the Board of Commissioners consists of 5 (five) persons or less, the composition of members of the Board of Commissioners must have different origins and/or experience; and

b. in the event that the number of members of the Board of Commissioners consists of 6 (six) persons or more, at least the composition of members of the Board of Commissioners as referred to in letter a must still be fulfilled.
(3) Two or more members of the Board of Commissioners of the Clearing and Settlement Institution are prohibited from coming from the same company or from 2 (two) or more companies controlled directly or indirectly by the same Party.
(4) The duration or period of experience of candidate members of the Board of Commissioners of the Clearing and Settlement Institution as referred to in paragraph (1) is calculated until the date of the GMS for the appointment of members of the Board of Commissioners of the Clearing and Settlement Institution.

Third Section
Procedures for Nomination and Submission of Board of Commissioners Members

Article 33
(1) Nomination and submission of candidates for members of the Board of Commissioners of the Clearing and Settlement Institution must be carried out by shareholders or groups of shareholders of the Clearing and Settlement Institution holding at least 20% (twenty percent) of the issued shares of the Clearing and Settlement Institution and having voting rights. (2) In the nomination of members of the Board of Commissioners of the Clearing and Settlement Institution, shareholders or groups of shareholders meeting the requirements as referred to in paragraph (1) jointly are responsible for:
a. searching and selecting candidates for members of the Board of Commissioners of the Clearing and Settlement Institution as referred to in Article 30;

b. examining the level of expertise, experience, and responsibility as members of the Board of Commissioners in accordance with this Financial Services Authority Regulation; and
c. recommending remuneration for each candidate for members of the Board of Commissioners of the Clearing and Settlement Institution considering the proposal of the Remuneration Committee (if any).
(3) Candidate members of the Board of Commissioners of the Clearing and Settlement Institution must be submitted to the Financial Services Authority by shareholders or groups of shareholders as referred to in paragraph (1) in 1 (one) package of Board of Commissioners candidates.
(4) The package submission as referred to in paragraph (3) does not apply to the submission of candidates for members of the Board of Commissioners of the Clearing and Settlement Institution to fill vacant positions of members of the Board of Commissioners of the Clearing and Settlement Institution or to add candidates for members of the Board of Commissioners of the Clearing and Settlement Institution.

Article 34
(1) In submitting candidates for members of the Board of Commissioners of the Clearing and Settlement Institution to the Financial Services Authority, shareholders or groups of shareholders as referred to in Article 33 paragraph (1) must attach in duplicate 2 (two) copies of the following documents:
a. curriculum vitae of candidate members of the Board of Commissioners of the Clearing and Settlement Institution; b. photocopy of the Candidate's Identity Card of the Clearing and Settlement Institution;
c. photocopy of diploma and expertise certificates showing the level of expertise of the candidate members of the Board of Commissioners (if any);
d. statement letter from each party submitted as a candidate for members of the Board of Commissioners containing at least:

stating that the candidate for members of the Board of Commissioners has met the provisions as referred to in Article 31 and Article 32;
stating the existence or non-existence of Affiliation relationships of candidate members of the Board of Commissioners with Securities Companies and Custodian Banks that are participants/users of the Clearing and Settlement Institution;
willingness without conditions to follow the capability and suitability assessment process conducted by the Financial Services Authority; and
willingness to be selected as members of the Board of Commissioners of the Clearing and Settlement Institution and to cooperate as best as possible with other members of the Board of Commissioners and members of the Board of Directors of the Clearing and Settlement Institution in carrying out the activities of the Clearing and Settlement Institution in an orderly, fair, and efficient manner.
e. Police Record Letter; f. answers to questions as contained in the Appendix which is an integral part of this Financial Services Authority Regulation; g. latest color passport photos size 10x15 cm with red background 3 (three) sheets; and h. letter of statement regarding the process of searching, selecting, and examining candidate members of the Board of Commissioners from shareholders or groups of shareholders of the Clearing and Settlement Institution including recommendations regarding remuneration if candidate members of the Board of Commissioners are appointed as members of the Board of Commissioners, stating that the process has been carried out professionally and there are no other interests

including interests due to Affiliation, besides solely for the interests of the Depository and Clearing Institution in particular and the Capital Market in general.

(2) The submission of the names of candidates for members of the Board of Commissioners by shareholders or groups of shareholders as referred to in Article 33 paragraph (1) and paragraph (3), along with supporting documents as referred to in paragraph (1), must meet the requirements and be received in complete form by the Financial Services Authority at the latest 35 (thirty-five) days before the General Meeting of Shareholders (GMS) for the appointment of members of the Board of Commissioners of the Depository and Clearing Institution.

Fourth Section
Assessment of Competency and Suitability of Candidates for Members of the Board of Commissioners

Article 35
(1) Every candidate for a member of the Board of Commissioners of the Depository and Clearing Institution submitted must undergo a competency and suitability assessment conducted by the Competency and Suitability Assessment Committee.

(2) Members of the Competency and Suitability Assessment Committee as referred to in paragraph (1) consist of 5 (five) people, namely a Deputy Commissioner as chairman ex officio, and 4 (four) officials at least at the director level as members.

(3) Every implementation of the competency and suitability assessment must be attended by at least 3 (three) members of the Competency and Suitability Assessment Committee.

(4) The Competency and Suitability Assessment Committee conducts the competency and suitability assessment of candidates for members of the Board of Commissioners of the Depository and Clearing Institution at least through administrative research and interviews, and/or presentation requests.

(5) In conducting the competency and suitability assessment of candidates for members of the Board of Commissioners of the Depository and Clearing Institution, the Competency and Suitability Assessment Committee may be assisted by resource persons with specific expertise from outside the Financial Services Authority.

Article 36
(1) The competency and suitability assessment is conducted to evaluate whether the candidate for a member of the Board of Commissioners meets the integrity and competency requirements as referred to in Article 31 and Article 32.

(2) The Competency and Suitability Assessment Committee, in conducting the competency and suitability assessment of candidates for members of the Board of Commissioners of the Depository and Clearing Institution, must take into account the composition of candidates for members of the Board of Commissioners of the Depository and Clearing Institution as referred to in Article 32.

Article 37
The Financial Services Authority has the authority to stop the nomination process for candidates for members of the Board of Commissioners of the Depository and Clearing Institution if the candidate is undergoing a legal process.

Article 38
The Head of the Capital Market Supervisory Executive sets the candidate for a member of the Board of Commissioners of the Depository and Clearing Institution by taking into account the results of the competency and suitability assessment conducted by the Competency and Suitability Assessment Committee.

Article 39
(1) In the event that there are no candidates for members of the Board of Commissioners of the Depository and Clearing Institution selected from the results of the competency and suitability assessment as referred to in Article 35 paragraph (4), for one (1) or more positions of members of the Board of Commissioners, the Financial Services Authority submits to each shareholder or group of shareholders as referred to in Article 33 paragraph (1) to submit other candidates for members of the Board of Commissioners of the Depository and Clearing Institution for the position where the candidate has not yet been selected by the Financial Services Authority in the competency and suitability assessment process, at the latest 14 (fourteen) days after the application meets the requirements and is received in complete form by the Financial Services Authority.

(2) Shareholders or groups of shareholders as referred to in Article 33 paragraph (1) may submit other candidates for members of the Board of Commissioners of the Depository and Clearing Institution for the position where the candidate has not yet been selected by the Financial Services Authority as referred to in paragraph (1) to the Financial Services Authority within a period of at the latest 14 (fourteen) days before the GMS for the appointment of members of the Board of Commissioners, by fulfilling the provisions in Article 31, Article 32, Article 33, and Article 34 paragraph (1).

(3) The Financial Services Authority conducts a competency and suitability assessment on other candidates for members of the Board of Commissioners of the Depository and Clearing Institution as referred to in paragraph (2).

Article 40
(1) If all documents as referred to in Article 34 paragraph (1) are complete and have met the requirements, the Financial Services Authority submits the list of selected candidates for members of the Board of Commissioners along with photocopies of the candidates' documents to the Board of Directors of the Depository and Clearing Institution at the latest 7 (seven) days before the GMS for the appointment of members of the Board of Commissioners of the Depository and Clearing Institution.

(2) The Board of Directors of the Depository and Clearing Institution must submit to all shareholders the list of candidates for members of the Board of Commissioners of the Depository and Clearing Institution along with complete photocopies of the documents at the latest 1 (one) working day after receiving the list of candidates for members of the Board of Commissioners from the Financial Services Authority.

(3) The list of candidates for members of the Board of Commissioners along with complete photocopies of the documents as referred to in paragraph (2) must be available and accessible to shareholders and the public.

Fifth Section
GMS and Procedures for the Appointment of Members of the Board of Commissioners

Article 41
(1) Announcement regarding the upcoming summons for the GMS for the appointment of members of the Board of Commissioners of the Depository and Clearing Institution is conducted at the latest 14 (fourteen) days before the GMS summons is conducted, containing at least the plan for the appointment of members of the Board of Commissioners of the Depository and Clearing Institution.

(2) The summons for the GMS for the appointment of members of the Board of Commissioners of the Depository and Clearing Institution is conducted at the latest 14 (fourteen) days before the aforementioned GMS, without counting the date of summons and the date of the GMS, containing at least the plan for the appointment of members of the Board of Commissioners of the Depository and Clearing Institution.

Article 42
(1) The appointment of members of the Board of Commissioners of the Depository and Clearing Institution is conducted by the GMS based on the candidates for members of the Board of Commissioners selected by the Financial Services Authority as referred to in Article 40 paragraph (1).

(2) The procedure for the appointment of candidates for members of the Board of Commissioners of the Depository and Clearing Institution as referred to in paragraph (1) also applies to the appointment of candidates for members of the Board of Commissioners of the Depository and Clearing Institution to fill vacant positions of members of the Board of Commissioners of the Depository and Clearing Institution or to add candidates for members of the Board of Commissioners of the Depository and Clearing Institution.

(3) The GMS to appoint members of the Board of Commissioners of the Depository and Clearing Institution must be chaired by the Chief Executive Director or one of the members of the Board of Directors in the event the Chief Executive Director is unable to attend.

Sixth Section
Positions of Members of the Board of Commissioners

Article 43
The term of office of members of the Board of Commissioners of the Depository and Clearing Institution is 3 (three) years calculated from the GMS for the appointment of members of the Board of Commissioners of the Depository and Clearing Institution until the closing of the GMS in the third year, and may only be reappointed for one (1) term of office with the following provisions:
a. if a member of the Board of Commissioners is appointed to replace a vacant position of a member of the Board of Commissioners of the Depository and Clearing Institution and/or there is an addition of new members of the Board of Commissioners, the term of office of that member of the Board of Commissioners of the Depository and Clearing Institution applies for the remaining term of office of the currently serving member of the Board of Commissioners of the Depository and Clearing Institution; b. the calculation of one (1) term of office for a member of the Board of Commissioners of the Depository and Clearing Institution is if the person concerned serves for at least 2/3 (two-thirds) of the term of office of the Board of Commissioners of the Depository and Clearing Institution; and
c. the total term of office of members of the Board of Commissioners at the Stock Exchange, Clearing and Guarantee Institution, and Depository and Clearing Institution is at most 3 (three) terms of office.

Article 44
(1) In the event that a member of the Board of Commissioners of the Depository and Clearing Institution no longer meets the requirements as referred to in Article 31 and Article 32, the following provisions apply:
a. the member of the Board of Commissioners of the Depository and Clearing Institution must be replaced within a period of at the latest 3 (three) months since the person concerned is declared by the Financial Services Authority to no longer meet the requirements; b. shareholders or groups of shareholders meeting the requirements as referred to in Article 33 paragraph (1) must immediately submit a candidate for a replacement member of the Board of Commissioners of the Depository and Clearing Institution to the Financial Services Authority in accordance with the procedures as referred to in Article 33 and Article 34; and
c. the candidate for a replacement member of the Board of Commissioners of the Depository and Clearing Institution must fulfill the provisions as referred to in Article 31 and Article 32.

(2) In the event that there is a vacant position of a member of the Board of Commissioners of the Depository and Clearing Institution, the Board of Directors of the Depository and Clearing Institution must report to the Financial Services Authority at the latest 5 (five) working days since it is known by the Board of Directors of the Depository and Clearing Institution.

(3) In filling the position of a member of the Board of Commissioners of the Depository and Clearing Institution to replace a vacant position of a member of the Board of Commissioners of the Depository and Clearing Institution and/or the need for additional new members of the Board of Commissioners, the following provisions apply:
a. the replacement or addition of members of the Board of Commissioners of the Depository and Clearing Institution must fulfill the provisions as regulated in Article 31 to Article 34; b. the candidate for a member of the Board of Commissioners of the Depository and Clearing Institution to be submitted must be willing to cooperate with and not obtain objection from the existing members of the Board of Commissioners; and
c. the addition of new members of the Board of Commissioners of the Depository and Clearing Institution must take into account the provisions as referred to in Article 31 and its implementation must fulfill the provisions as referred to in Article 32 to Article 35.

(4) The Financial Services Authority may determine that a vacant position of a member of the Board of Commissioners of the Depository and Clearing Institution as referred to in paragraph (2) does not need to be filled after considering the development of activities and operations of the Depository and Clearing Institution.

(5) The time limit for the replacement of members of the Board of Commissioners of the Depository and Clearing Institution as referred to in paragraph (1) may be determined otherwise by the Financial Services Authority.

Article 45
The term of office of members of the Board of Commissioners of the Depository and Clearing Institution ends automatically if:
a. losing Indonesian citizenship; b. being incapable of performing legal acts;
c. being declared bankrupt or becoming a member of the Board of Commissioners or a member of the Board of Directors who is declared guilty or complicit in causing a company to be declared bankrupt;
d. being sentenced for proven criminal acts; e. being permanently unable to perform duties; f. passing away; and/or g. the term of office expires.

Article 46
Members of the Board of Commissioners of the Depository and Clearing Institution may be dismissed from their position by the Financial Services Authority if:
a. lacking good ethics and morals; b. committing disgraceful acts in the financial services sector;
c. committing material violations of regulations in the financial services sector;
d. lacking commitment to the development of the Depository and Clearing Institution; and/or e. failing or being incapable of performing duties.

Article 47
The Board of Commissioners of the Depository and Clearing Institution must hold meetings at least once a month, chaired by the Chief Commissioner or one of the members of the Board of Commissioners in the event the Chief Commissioner is unable to attend.

Article 48
The Board of Commissioners of the Depository and Clearing Institution, in performing its duties, may form an Audit Committee and a Remuneration Committee, with the following provisions:
a. the chairman of the Audit Committee and the chairman of the Remuneration Committee are one of the members of the Board of Commissioners of the Depository and Clearing Institution; b. the Audit Committee is tasked with providing independent professional opinions to the Board of Commissioners of the Depository and Clearing Institution regarding reports or matters submitted by the Board of Directors to the Board of Commissioners of the Depository and Clearing Institution and identifying matters requiring the attention of the Board of Commissioners of the Depository and Clearing Institution; and
c. members of the Audit Committee must have expertise and experience in the fields of law, accounting, or finance.

Article 49
Members of the Board of Commissioners of the Depository and Clearing Institution are given honorariums, the amount of which is proposed or recommended by shareholders or groups of shareholders as referred to in Article 33 paragraph (2) letter c, considering the proposal of the Remuneration Committee (if any), before the implementation of the GMS for the appointment of members of the Board of Commissioners of the Depository and Clearing Institution.

Article 50
Honorariums for members of the Board of Commissioners of the Depository and Clearing Institution as referred to in Article 49 must receive approval and be established by the GMS.

Article 51
Members of the Board of Commissioners of the Depository and Clearing Institution who no longer serve as members of the Board of Commissioners of the Depository and Clearing Institution for any reason are not entitled to receive honorariums from the Depository and Clearing Institution, except for rights to compensation or reward fees as long as approved by the GMS, with the provision that the amount of compensation or reward fees is not greater than the amount of honorariums for the remaining term of office.

CHAPTER IV
SANCTION PROVISIONS

Article 52
(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. fines, 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 g. cancellation of registration.

(2) Administrative sanctions as referred to in paragraph (1) letter b, letter c, letter d, letter e, letter f, or letter g may be imposed with or without prior imposition of administrative sanctions in the form of a written warning as referred to in paragraph (1) letter a.

(3) Administrative sanctions in the form of fines as referred to in paragraph (1) letter b may be imposed separately or together with the imposition of administrative sanctions as referred to in paragraph (1) letter c, letter d, letter e, letter f, or letter g.

Article 53
In addition to administrative sanctions as referred to in Article 52 paragraph (1), the Financial Services Authority may take certain actions against any party that violates the provisions of this Financial Services Authority Regulation.

CHAPTER V
TRANSITIONAL PROVISIONS

Article 54
In the event that there is a submission for filling positions of members of the Board of Directors and members of the Board of Commissioners of the Depository and Clearing Institution to completely replace, fill vacant positions of members of the Board of Directors and members of the Board of Commissioners who do not meet requirements, or add members of the Board of Directors and members of the Board of Commissioners before this Financial Services Authority Regulation comes into force, the procedure for submitting members of the Board of Directors and members of the Board of Commissioners follows the provisions of legislation in the Capital Market sector regulating Directors and the Board of Commissioners that were in force at the time of submission.

CHAPTER VI
CLOSING PROVISIONS

Article 55
At the time this Financial Services Authority Regulation comes into force:

The Decision of the Head of the Capital Market Supervisory Agency and Financial Institutions Number Kep-14/BL/2009 dated January 30, 2009 regarding the Director of the Depository and Clearing Institution, along with Regulation Number III.C.3 which is its attachment; and
The Decision of the Head of the Capital Market Supervisory Agency and Financial Institutions Number Kep-108/BL/2008 dated April 10, 2008 regarding the Commissioner of the Depository and Clearing Institution, along with Regulation Number III.C.8 which is its attachment,
are revoked and declared invalid.

Article 56
This Financial Services Authority Regulation comes into force on the date of its promulgation.

To ensure everyone knows it, order the promulgation of this Financial Services Authority Regulation by placing it in the State Gazette of the Republic of Indonesia.

Established in Jakarta on December 20, 2016
CHAIRMAN OF THE COMMISSIONERS BOARD
FINANCIAL SERVICES AUTHORITY, signature
MULIAMAN D. HADAD

Promulgated in Jakarta on December 28, 2016
MINISTER OF LAW AND HUMAN RIGHTS
REPUBLIC OF INDONESIA, signature
YASONNA H. LAOLY

STATE GAZETTE OF THE REPUBLIC OF INDONESIA YEAR 2016 NUMBER 314 Copy in accordance with the original Legal Director 1 Ministry of Law sign Yuliana

EXPLANATION
OF
FINANCIAL SERVICES AUTHORITY REGULATION
NUMBER 60 /POJK.04/2016
ABOUT
DIRECTORS AND BOARD OF COMMISSIONERS
OF THE DEPOSITORY AND CLEARING INSTITUTION

I. GENERAL
That with the implementation of Law Number 21 of 2011 concerning the Financial Services Authority which establishes the authority to regulate and supervise activities in the financial services sector including the Capital Market shifting from the Capital Market Supervisory Agency and Financial Institutions to the Financial Services Authority, the Financial Services Authority has an interest in maintaining that the Capital Market continues to be organized in an orderly, fair, transparent, and efficient manner. To realize this, it is necessary to improve the provisions that apply to every Party conducting activities in the Capital Market, one of which is the Depository and Clearing Institution established to conduct Central Custodian activities for Custodian Banks, Securities Companies, and other Parties. In order to improve good corporate governance of the Depository and Clearing Institution that is globally competitive, it is necessary for Directors and Commissioners of the Depository and Clearing Institution to have high competency and integrity and meet the requirements as stipulated in applicable legislation. Regulations regarding the Director of the Depository and Clearing Institution are currently regulated in Capital Market Supervisory Agency and Financial Institutions Regulation Number III.C.3 regarding the Director of the Depository and Clearing Institution, attachment of the Decision of the Head of the Capital Market Supervisory Agency and Financial Institutions Number Kep-14/BL/2009 dated January 30, 2009 (Regulation Number III.C.3 regarding the Director of the Depository and Clearing Institution), while regulations regarding the Commissioner of the Depository and Clearing Institution are regulated in Capital Market Supervisory Agency and Financial Institutions Regulation Number III.C.8 regarding the Commissioner of the Depository and Clearing Institution, attachment of the Decision of the Head of the Capital Market Supervisory Agency and Financial Institutions Number Kep-108/BL/2008 dated April 10, 2008 (Regulation Number III.C.8 regarding the Commissioner of the Depository and Clearing Institution). Considering this, it is necessary to make changes and merge the Capital Market Supervisory Agency and Financial Institutions Regulation Number III.C.3 regarding the Director of the Depository and Clearing Institution and the Capital Market Supervisory Agency and Financial Institutions Regulation Number III.C.8 regarding the Commissioner of the Depository and Clearing Institution by establishing a Financial Services Authority Regulation regarding Directors and the Board of Commissioners of the Depository and Clearing Institution.

II. ARTICLE BY ARTICLE
Article 1
Quite clear.

Article 2
Paragraph (1)
Quite clear.
Paragraph (2)
What is meant by "final decision" is a decision established by the Chief Executive Director of the Depository and Clearing Institution in the event of a difference of opinion between members of the Board of Directors of the Depository and Clearing Institution so that the Board of Directors meeting of the Depository and Clearing Institution cannot make a decision, then the decision will be determined by the Chief Executive Director. The decision established by the Chief Executive Director is one of the two or more opinions submitted in the Board of Directors meeting of the Depository and Clearing Institution. Paragraph (3) Quite clear.

Article 3
Paragraph (1)
Quite clear.
Paragraph (2)
Quite clear.
Paragraph (3)
At the time this Financial Services Authority Regulation comes into force, the legislation in the Capital Market sector regulating Licensing of the Depository and Clearing Institution that is in force is Regulation Number III.C.1, attachment of the Decision of the Head of the Capital Market Supervisory Agency Number Kep-12/PM/1996 dated January 17, 1996 regarding Licensing of the Depository and Clearing Institution. Paragraph (4) Quite clear. Paragraph (5) Quite clear. Paragraph (6) Quite clear. Paragraph (7) Quite clear.

Article 4
Quite clear.

Article 5
Letter a
Number 1
Quite clear.
Number 2
Quite clear.
Number 3
Quite clear.
Number 4
What is meant by "criminal act" is:

criminal acts in the financial field, namely criminal acts in the Banking field, criminal acts in the Capital Market field, and criminal acts in the Non-Bank Financial Industry field that are proven to have been committed within the last 20 (twenty) years before nomination;
special criminal acts, namely criminal acts other than those regulated in the Criminal Code with a penalty of imprisonment of 1 (one) year or more, at least: corruption; narcotics/psychotropics; smuggling; customs; excise; human trafficking; illegal arms trafficking; terrorism; counterfeiting money; in the field of taxation; in the field of forestry; in the field of the environment; in the field of marine and fisheries, which are proven to have been committed within the last 20 (twenty) years before nomination; and
criminal acts, namely criminal acts listed in the Criminal Code with a penalty of imprisonment of 1 (one) year or more that are proven to have been committed within the last 10 (ten) years before nomination.
Assessment of the criteria in this number is conducted at least based on information obtained by the Financial Services Authority or information known to the public, that the person concerned has been sentenced for committing criminal acts in the financial field or special criminal acts within the last 20 (twenty) years before nomination or has been sentenced for committing criminal acts within the last 10 (ten) years before nomination. What is meant by "before nomination" is calculated from the date the application for submission of the name of the candidate for a member of the Board of Directors of the Depository and Clearing Institution is received in complete form by the Financial Services Authority. Number 5 Quite clear. Number 6 Quite clear. Number 7 Quite clear. Letter b Quite clear.

Article 6
Letter a
In the event that the candidate for the Board of Directors of the Depository and Clearing Institution consists of 4 (four) people and after the composition of the Board of Directors of the Depository and Clearing Institution meets the experience requirements as referred to in Article 6 letter a, then other candidates for members of the Board of Directors of the Depository and Clearing Institution must still fulfill the requirements as referred to in Article 6 letter a. Letter b In the event that the candidate for the Board of Directors of the Depository and Clearing Institution consists of 5 (five) people and after the composition of the Board of Directors of the Depository and Clearing Institution meets the experience requirements as referred to in Article 6 letter b, then other candidates for members of the Board of Directors must still fulfill the requirements as referred to in Article 6 letter b. Letter c Quite clear.

Article 7
Quite clear.

Article 8
Paragraph (1)
Clearly stated.
Paragraph (2)
Letter a
Clearly stated.
Letter b
Clearly stated.
Letter c
Salary recommendations and other benefits for candidates for the Depository and Clearing Institution are determined based on the feasibility generally applicable to each position of the members of the Board of Directors of the Depository and Clearing Institution according to their duties and responsibilities based on the expertise and experience of each candidate member of the Board of Directors of the Depository and Clearing Institution. Paragraph (3) Clearly stated. Paragraph (4) Clearly stated.
Article 9
Clearly stated.
Article 10
Clearly stated.
Article 11
Clearly stated.
Article 12
The legal process referred to in this paragraph means the investigation or judicial process (including appeals and cassation) in criminal cases that include:

Crimes in the financial sector, namely crimes in the Banking sector, the Capital Market sector, and the Non-Bank Financial Industry sector;
Special crimes, namely crimes other than those regulated in the Criminal Code with a penalty of imprisonment of 1 (one) year or more, at least: corruption; narcotics/psychotropics; smuggling; customs; excise; human trafficking; illegal arms trafficking; terrorism; counterfeiting of money; in the tax sector; in the forestry sector; in the environmental sector; in the marine and fisheries sector; and
Criminal offenses, namely crimes recorded in the Criminal Code with a penalty of imprisonment of 1 (one) year or more.
Article 13
Clearly stated.
Article 14
Clearly stated.
Article 15
Clearly stated.
Article 16
Clearly stated.
Article 17
Clearly stated.
Article 18
Clearly stated.
Article 19
Clearly stated.
Article 20
Clearly stated.
Article 21
Clearly stated.

Article 22
Clearly stated.
Article 23
Clearly stated.
Article 24
Letter a
Clearly stated.
Letter b
Clearly stated.
Letter c
Clearly stated.
Letter d
The term "criminal offense" refers to:

Crimes in the financial sector, namely crimes in the Banking sector, crimes in the Capital Market sector, and crimes in the Non-Bank Financial Industry sector;
Special crimes, namely crimes other than those regulated in the Criminal Code with a penalty of imprisonment of 1 (one) year or more, at least: corruption; narcotics/psychotropics; smuggling; customs; excise; human trafficking; illegal arms trafficking; terrorism; counterfeiting of money; in the tax sector; in the forestry sector; in the environmental sector; in the marine and fisheries sector; and
Criminal offenses, namely crimes recorded in the Criminal Code with a penalty of imprisonment of 1 (one) year or more.
Letter e
The term "permanent inability" refers at least to permanent illness resulting in the inability to perform work activities, proven by a doctor's certificate.
Letter f
Clearly stated.
Letter g
Clearly stated.

Article 25
Clearly stated.
Article 26
Clearly stated.
Article 27
Clearly stated.
Article 28
Clearly stated.
Article 29
Clearly stated.
Article 30
Clearly stated.
Article 31
Letter a
Number 1
Clearly stated.
Number 2
Clearly stated.
Number 3
Clearly stated.
Number 4
The term "criminal offense" refers to:

Crimes in the financial sector, namely crimes in the Banking sector, crimes in the Capital Market sector, and crimes in the Non-Bank Financial Industry sector that are proven to have been committed within the last 20 (twenty) years prior to nomination;
Special crimes, namely crimes other than those regulated in the Criminal Code with a penalty of imprisonment of 1 (one) year or more, at least: corruption;

narcotics/psychotropics; smuggling; customs; excise; human trafficking; illegal arms trafficking; terrorism; counterfeiting of money; in the tax sector; in the forestry sector; in the environmental sector; in the marine and fisheries sector that are proven to have been committed within the last 20 (twenty) years prior to nomination; and
3. Criminal offenses, namely crimes recorded in the Criminal Code with a penalty of imprisonment of 1 (one) year or more that are proven to have been committed within the last 10 (ten) years prior to nomination.
Assessment of the criteria in this number is conducted based at least on information obtained from the Financial Services Authority or information known to the public, that the person concerned has been sentenced for committing crimes in the financial sector and special crimes within the last 20 (twenty) years prior to nomination or has been sentenced for committing criminal offenses within the last 10 (ten) years prior to nomination. The term "prior to nomination" is calculated from the date the application for the submission of the name of the candidate member of the Board of Directors of the Depository and Clearing Institution is received completely by the Financial Services Authority. Number 5 Clearly stated. Number 6 Clearly stated. Number 7 Clearly stated. Letter b Clearly stated.
Article 32
Clearly stated.

Article 33
Paragraph (1)
Clearly stated.
Paragraph (2)
Letter a
Clearly stated.
Letter b
Clearly stated.
Letter c
Honorarium recommendations for candidate members of the Board of Commissioners of the Depository and Clearing Institution must be determined based on the feasibility generally applicable to each member of the Board of Commissioners of the Depository and Clearing Institution according to their duties and responsibilities based on the expertise and experience of each candidate member of the Board of Commissioners of the Depository and Clearing Institution. Paragraph (3) Clearly stated. Paragraph (4) Clearly stated.
Article 34
Clearly stated.
Article 35
Clearly stated.
Article 36
Clearly stated.
Article 37
Clearly stated.
Article 38
Clearly stated.

Article 39
Clearly stated.
Article 40
Clearly stated.
Article 41
Clearly stated.
Article 42
Clearly stated.
Article 43
Clearly stated.
Article 44
Clearly stated.
Article 45
Letter a
Clearly stated.
Letter b
Clearly stated.
Letter c
Clearly stated.
Letter d
The term "criminal offense" refers to:

Crimes in the financial sector, namely crimes in the Banking sector, crimes in the Capital Market sector, and crimes in the Non-Bank Financial Industry sector;
Special crimes, namely crimes other than those regulated in the Criminal Code with a penalty of imprisonment of 1 (one) year or more, at least: corruption; narcotics/psychotropics;
smuggling; customs; excise; human trafficking; illegal arms trafficking; terrorism; counterfeiting of money; in the tax sector; in the forestry sector; in the environmental sector; in the marine and fisheries sector; and
Criminal offenses, namely crimes recorded in the Criminal Code with a penalty of imprisonment of 1 (one) year or more.
Letter e
The term "permanent inability" refers at least to permanent illness resulting in the inability to perform work activities, proven by a doctor's certificate.
Letter f
Clearly stated.
Letter g
Clearly stated.
Article 46
Clearly stated.
Article 47
Clearly stated.
Article 48
Clearly stated.
Article 49
Clearly stated.
Article 50
Clearly stated.
Article 51
Clearly stated.
Article 52
Clearly stated.
Article 53
Clearly stated.

Article 54
At the time this Financial Services Authority Regulation takes effect, the existing legislation in the Capital Market sector regulating the Board of Directors and Board of Commissioners is:

Regulation Number III.C.3, appendix of the Decision of the Chairman of the Capital Market and Financial Institution Supervisory Board Number Kep-14/BL/2009 dated January 30, 2009 concerning Directors of Depository and Clearing Institutions; and
Regulation Number III.C.8, appendix of the Decision of the Chairman of the Capital Market and Financial Institution Supervisory Board Number Kep-108/BL/2008 dated April 10, 2008 concerning Commissioners of Depository and Clearing Institutions.
Article 55
Clearly stated.
Article 56
Clearly stated.
SUPPLEMENT TO THE STATE GAZETTE OF THE REPUBLIC OF INDONESIA NUMBER 6002 ---

POJK on the Board of Directors and Board of Commissioners of the Depository and Clearing Institution