POJK Regarding Merger or Consolidation of Open Companies

FINANCIAL SERVICES AUTHORITY REGULATION
NUMBER 74 /POJK.04/2016
CONCERNING
MERGER OR CONSOLIDATION OF OPEN COMPANIES
BY THE GRACE OF THE ALMIGHTY GOD,
THE COMMISSIONERS OF THE FINANCIAL SERVICES AUTHORITY, Considering: that in order to simplify the regulations on Merger or Consolidation of Business and to improve the quality of information disclosure in the proposed Merger or Consolidation of Business, it is necessary to perfect regulations regarding Merger or Consolidation of Public Companies or Emitters by establishing a Financial Services Authority Regulation concerning Merger or Consolidation of Open 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
COPY

DECIDES:
Determining: FINANCIAL SERVICES AUTHABILITY REGULATION CONCERNING MERGER OR CONSOLIDATION OF OPEN COMPANIES.

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

1. Open Company is an Emitter that has conducted a Public Offering of Equity Securities or a Public Company.
2. Merger of Business is a legal act performed by 1 (one) or more companies to merge with an existing other company, resulting in the assets, liabilities, and equity of the merging company transferring by law to the receiving company, and subsequently the legal status of the merging company ends by law.
3. Consolidation of Business is a legal act performed by 2 (two) or more companies to merge by establishing 1 (one) new company that by law acquires the assets, liabilities, and equity of the merging companies, and the legal status of the merging companies ends by law.
4. Statement of Merger of Business is a document that must be submitted to the Financial Services Authority by an Open Company in the context of a Merger of Business.
5. Statement of Consolidation of Business is a document that must be submitted to the Financial Services Authority by an Open Company in the context of a Consolidation of Business.
6. General Meeting of Shareholders is the organ of an Open Company that has authority not granted to the Board of Directors or Board of Commissioners as referred to in Law Number 40 of 2007 concerning Limited Liability Companies and/or the Articles of Association of an Open Company.
7. Stock Exchange is a Party that organizes and provides systems and/or facilities to match offers to sell and buy Securities of other Parties with the aim of trading Securities among them.
8. Subsidiary Company is a company whose financial statements are consolidated with the financial statements of an Open Company.
9. Appraiser is a person who, with their expertise, conducts valuation activities in the Capital Market and is registered with the Financial Services Authority.
10. Public Accountant is a person who has obtained a license to provide services as regulated in legislation regarding public accountants and is registered with the Financial Services Authority.
11. Legal Consultant is a legal expert who provides legal opinions to other parties and is registered with the Financial Services Authority.
12. Main Business Activity is business activity as stated in the Articles of Association of an Open Company and has been carried out.
13. Controller is a party that owns more than 50% (fifty percent) of all fully paid-up shares, or a party that has the ability to determine, directly or indirectly, in any way, the management and/or policy of an Open Company.
14. Website is a collection of web pages containing information or data that can be accessed through an internet network system.

Article 2
(1) Merger or Consolidation of Business may only be executed if it does not conflict with legislation.
(2) Provisions in Law Number 40 of 2007 concerning Limited Liability Companies related to Merger or Consolidation of Business, insofar as they are not specifically regulated in this Financial Services Authority Regulation, remain applicable to companies.

CHAPTER II
PROCEDURES FOR MERGER OR CONSOLIDATION OF BUSINESS First Section Proposed Merger or Consolidation of Business
Article 3
(1) The Boards of Directors of each company intending to conduct a Merger or Consolidation of Business must jointly prepare a proposed Merger or Consolidation of Business.
(2) The proposed Merger or Consolidation of Business as referred to in paragraph (1) must be approved by the Board of Commissioners of each company.
Article 4
(1) The proposed Merger or Consolidation of Business as referred to in Article 3 must contain at least the following information:
a. name, domicile, business activity, capital structure, shareholders, and management and supervision of each company intending to conduct a Merger or Consolidation of Business; b. name and domicile of the resulting company from the Merger or Consolidation of Business;
c. composition of the Board of Directors and Board of Commissioners of the resulting company from the Merger or Consolidation of Business;
d. schedule of the proposed Merger or Consolidation of Business; e. reasons and explanations for conducting the Merger or Consolidation of Business from each company intending to conduct a Merger or Consolidation of Business; f. method of share conversion from each company intending to conduct a Merger or Consolidation of Business to the shares of the resulting company from the Merger or Consolidation of Business; g. draft amendment to the Articles of Association of the resulting company from the Merger of Business (if any) or draft deed of establishment of the new company resulting from the Consolidation of Business; h. summary of important financial data sourced from financial statements audited by a Public Accountant from each company intending to conduct a Merger or Consolidation of Business, with the following provisions:

1. in the event that the company intending to conduct a Merger or Consolidation of Business is an Open Company, covering the last 2 (two) years; or
2. in the event that the company intending to conduct a Merger or Consolidation of Business is not an Open Company, covering the last 3 (three) years.
   i. in the event that there is interim financial data, disclosure is presented with a comparison of the same interim period from the previous fiscal year (not necessarily audited), except for the statement of financial position;
   j. pro forma financial information of the resulting company from the Merger or Consolidation of Business examined by a Public Accountant; k. summary of the Appraiser's report regarding the valuation of shares of each company intending to conduct a Merger or Consolidation of Business, which must include at least:
3. party identity;
4. valuation object;
5. valuation purpose;
6. assumptions and limiting conditions;
7. valuation approach and valuation method; and
8. value conclusion;
   l. summary of the Appraiser's report regarding the fairness opinion on the Merger or Consolidation of Business;
   m. results of expert valuation regarding specific aspects of the Merger or Consolidation of Business (if required); n. opinion of the Legal Consultant regarding legal aspects of the Merger or Consolidation of Business; o. method for resolving the status of employees of the company intending to conduct a Merger or Consolidation of Business; p. method for resolving the rights and obligations of the company intending to conduct a Merger or Consolidation of Business with third parties; q. method for resolving the rights of shareholders who do not agree with the Merger or Consolidation of Business; and r. explanation of benefits, risks that may arise from the Merger or Consolidation of Business along with mitigation of such risks, and future business plans. (2) In the event that Merger or Consolidation of Business is conducted by an Open Company with a Subsidiary Company at the time of submitting the Statement of Merger or Consolidation of Business to the Financial Services Authority:
   a. the financial statements of the Subsidiary Company have been consolidated with the financial statements of the Open Company audited by a Public Accountant; and b. the Subsidiary Company is directly owned by the Open Company at 100% (one hundred percent), the proposed Merger or Consolidation of Business is not required to contain information as referred to in paragraph (1) letters f, j, k, and l.
   Article 5
   The Board of Directors of an Open Company intending to conduct a Merger or Consolidation of Business must make a statement to the Financial Services Authority and the General Meeting of Shareholders that the Merger or Consolidation of Business is conducted by considering the interests of the company, society, and healthy competition in conducting business, and there is a guarantee that the rights of shareholders and employees will continue to be fulfilled.
   Article 6
   (1) In the event that Merger or Consolidation of Business as referred to in Article 2 will result in material changes to the nature, financial condition, or other matters affecting the resulting company from the Merger or Consolidation of Business, the entire consequences of such changes must be included in the proposed Merger or Consolidation of Business as referred to in Article 4 paragraph (1). (2) In the event that Merger or Consolidation of Business results in a change to the Main Business Activity of an Open Company, in addition to containing information as referred to in Article 4 paragraph (1), the proposed Merger or Consolidation of Business must also contain:
   a. summary of the feasibility study for changing the Main Business Activity, covering at least:
9. intent and purpose;
10. assumptions and limiting conditions; and
11. opinion on the feasibility of changing the Main Business Activity;
    b. availability of experts related to the change in Main Business Activity;
    c. explanation, considerations, and reasons for changing the Main Business Activity; and
    d. explanation of the impact of changing the Main Business Activity on the financial condition of an Open Company.
    Article 7
    In the event that Merger or Consolidation of Business will result in a new Controller of an Open Company, in addition to containing information as referred to in Article 4 paragraph (1), the proposed Merger or Consolidation of Business must also contain:
    a. information regarding the prospective Controller of an Open Company, covering at least:
12. in the event that the prospective Controller of an Open Company is an individual, information must be disclosed regarding name, address, and affiliation with the Open Company (if any); or
13. in the event that the prospective Controller of an Open Company is another party other than an individual, information must be disclosed regarding:
    a) name; b) domicile or headquarters address; c) business field; d) legal entity status; e) management and supervision composition; f) capital structure or equivalent information; g) financial data summary; h) beneficiaries of the prospective Controller (if any); and i) nature of affiliation with the Open Company (if any). b. brief information regarding management analysis and discussion of the company intending to conduct a Merger or Consolidation of Business, covering at least:
14. comprehensive financial performance analysis including comparison of financial performance in the last 2 (two) years;
15. financial liquidity;
16. sources and amounts of cash flows from operating, investing, and financing activities and cash flow patterns related to the characteristics and business cycle of an Open Company;
17. important components of revenue or other expenses considered necessary to understand business results; and
18. material capital goods investment commitments.

Second Section
Information Disclosure to the Public
Article 8
(1) An Open Company conducting a Merger or Consolidation of Business must announce a summary of the proposed Merger or Consolidation of Business to the public no later than the end of the 2nd (second) working day after obtaining the approval of the Board of Commissioners and 30 (thirty) days before the convening of the General Meeting of Shareholders. (2) The announcement as referred to in paragraph (1) must contain at least:
a. information that the proposed Merger or Consolidation of Business has not yet received an effective statement from the Financial Services Authority and has not yet obtained approval from the General Meeting of Shareholders; and b. summary of the proposed Merger or Consolidation of Business as referred to in Article 4 paragraph (1). (3) The announcement as referred to in paragraph (1) must be conducted at least through:
a. 1 (one) daily newspaper in Indonesian with national circulation or the Stock Exchange Website; and b. the Website of an Open Company.
(4) Proof of announcement as referred to in paragraph (3) must be submitted to the Financial Services Authority no later than 2 (two) working days after the announcement.
Article 9
The proposed Merger or Consolidation of Business as referred to in Article 4 paragraph (1) must be available to shareholders since the date of announcement of the summary of the proposed Merger or Consolidation of Business.

Third Section
Information Disclosure to Employees
Article 10
An Open Company conducting a Merger or Consolidation of Business must announce in writing to the employees of the company conducting the Merger or Consolidation of Business simultaneously with the announcement of the summary of the proposed Merger or Consolidation of Business as referred to in Article 8 paragraph (1).

Fourth Section
Submission of Statement of Merger or Consolidation of Business
Article 11
(1) An Open Company must submit a Statement of Merger or Consolidation of Business containing the proposed Merger or Consolidation of Business along with supporting documents to the Financial Services Authority in the form of:
a. printed documents in 2 (two) copies, 1 (one) of which is in original form; and b. electronic document copies.
(2) The submission of a Statement of Merger or Consolidation of Business as referred to in paragraph (1) must be submitted no later than the end of the 2nd (second) working day after obtaining the approval of the Board of Commissioners. (3) A Statement of Merger or Consolidation of Business submitted in the form of electronic document copies must contain the same information as the Statement of Merger or Consolidation of Business submitted in the form of printed documents. (4) In the event that there is a difference in information presented in the electronic document copy compared to that presented in the printed document as referred to in paragraph (3), the information used as the reference is the information in the Statement of Merger or Consolidation of Business submitted in the form of original printed documents. (5) Supporting documents as referred to in paragraph (1) must include at least:
a. financial statements audited by a Public Accountant from each company intending to conduct a Merger or Consolidation of Business, with the following provisions:

1. in the event that the company intending to conduct a Merger or Consolidation of Business is an Open Company, covering the last 2 (two) years, meeting the following provisions:
   a) the time interval between the date of the last annual financial statement and the effective date of the Statement of Merger or Consolidation of Business is not more than 6 (six) months; and b) in the event that the time interval as referred to in letter a) is more than 6 (six) months, the financial statements must be supplemented with audited interim financial statements by a Public Accountant, with the provision that the date of the interim financial statements to the effective date of the Statement of Merger or Consolidation of Business is not more than 6 (six) months;
2. in the event that the company intending to conduct a Merger or Consolidation of Business is not an Open Company, covering the last 3 (three) years;
   b. opinion regarding legal aspects of the Merger or Consolidation of Business;
   c. pro forma financial information of the resulting company from the Merger or Consolidation of Business examined by a Public Accountant;
   d. share valuation report; e. fairness opinion report on the Merger or Consolidation of Business; f. statement of the Board of Directors of an Open Company that the Merger or Consolidation of Business is conducted by considering the interests of the company, society, and healthy competition in conducting business, and there is a guarantee that the rights of shareholders and employees will continue to be fulfilled; g. approval of the Board of Commissioners of each company regarding the proposed Merger or Consolidation of Business; h. draft amendment to the Articles of Association of the resulting company from the Merger of Business (if any) or draft deed of establishment of the new company resulting from the Consolidation of Business; and
   i. expert valuation report (if any).
   (6) In the event that Merger or Consolidation of Business is conducted by an Open Company with a Subsidiary Company at the time of submitting the Statement of Merger or Consolidation of Business to the Financial Services Authority:
   a. the financial statements of the Subsidiary Company have been consolidated with the financial statements of the Open Company audited by a Public Accountant; and b. the Subsidiary Company is directly owned by the Open Company at 100% (one hundred percent), the supporting documents as referred to in paragraph (5) letters c, d, and e are not required to be submitted.
   Article 12
   In the event that Merger or Consolidation of Business is conducted between Open Companies, an Open Company:
   a. is not required to submit annual financial statements, if the last annual financial statements submitted to the Financial Services Authority are less than 6 (six) months old at the time the Statement of Merger or Consolidation of Business becomes effective; or b. must submit audited interim financial statements by a Public Accountant, if the last annual financial statements submitted to the Financial Services Authority will be more than 6 (six) months old at the time the Statement of Merger or Consolidation of Business becomes effective, with the provision that the time interval between the date of the interim financial statements and the effective date of the Statement of Merger or Consolidation of Business is not more than 6 (six) months.
   Article 13
   (1) In the event that a Merger of Business is conducted between Open Companies, the submission of a Statement of Merger of Business to the Financial Services Authority as referred to in Article 11 paragraph (1) is conducted by the Open Company receiving the Merger of Business. (2) In the event that a Consolidation of Business is conducted between Open Companies, the submission of a Statement of Consolidation of Business to the Financial Services Authority as referred to in Article 11 paragraph (1) is conducted by one of the Open Companies conducting the Consolidation of Business.

Fifth Section
Request for Changes and/or Additional Information
Article 14
(1) The Financial Services Authority may request changes and/or additional information 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 regarding a Statement of Merger or Consolidation of Business and supporting documents, the Statement of Merger or Consolidation of Business is considered to have been resubmitted on the date the changes are submitted to the Financial Services Authority. (3) An Open Company must submit changes and/or additional information regarding a Statement of Merger or Consolidation of Business as referred to in paragraph (2) within a maximum period of 10 (ten) working days since receiving the request from the Financial Services Authority. (4) In the event that an Open Company is unable to submit changes and/or additional information within the time as referred to in paragraph (3), an Open Company must announce this on the Website of an Open Company on the first working day after the expiration of the time limit. (5) In the event that the Financial Services Authority does not request changes and/or additional information within a period of 20 (twenty) days after the submission of a Statement of Merger or Consolidation of Business or the last changes and/or additional information from a Statement of Merger or Consolidation of Business to the Financial Services Authority, the Statement of Merger or Consolidation of Business is considered to have been submitted completely and meets the established requirements and procedures.
Article 15
(1) An Open Company must announce changes and/or additional information as referred to in Article 14 paragraph (3) no later than 2 (two) working days before the General Meeting of Shareholders in the context of a Merger or Consolidation of Business. (2) The announcement as referred to in paragraph (1) must be conducted at least through:
a. 1 (one) daily newspaper in Indonesian with national circulation or the Stock Exchange Website; and b. the Website of an Open Company.

Sixth Section
Effectiveness of Statement of Merger or Consolidation of Business
Article 16
A Statement of Merger or Consolidation of Business may become effective by observing the following provisions:
a. based on the passage of time, namely:

1. 20 (twenty) days since the date a Statement of Merger or Consolidation of Business is received completely by the Financial Services Authority; or
2. 20 (twenty) days since the date of the last changes submitted by an Open Company or requested by the Financial Services Authority to be fulfilled; or
   b. based on an effective statement from the Financial Services Authority that no further changes and/or additional information are required.

CHAPTER III
HOLDING OF GENERAL MEETING OF SHAREHOLDERS IN THE CONTEXT OF MERGER OR CONSOLIDATION OF BUSINESS
Article 17
(1) Merger or Consolidation of Business must obtain approval from the General Meeting of Shareholders of an Open Company.
(2) The General Meeting of Shareholders of an Open Company as referred to in paragraph (1) is held after the Statement of Merger or Consolidation of Business becomes effective.
Article 18
The plan and holding of the General Meeting of Shareholders of an Open Company in the context of a Merger or Consolidation of Business must meet the provisions as referred to in

POJK on Merger or Consolidation of Public Companies

Article 18
Refers to the Financial Services Authority Regulation on the Plan and Organization of the General Meeting of Shareholders of Public Companies.

Article 19
A Public Company may announce the General Meeting of Shareholders in the context of a Merger or Consolidation simultaneously with the announcement of the summary of the draft Merger or Consolidation as referred to in Article 8 paragraph (1).

Article 20
In the event of a conflict of interest in a Merger or Consolidation, the General Meeting of Shareholders must comply with the provisions of the General Meeting of Shareholders for transactions involving a conflict of interest as referred to in the legislation in the capital market sector regulating affiliated transactions and certain transactions involving conflicts of interest.

Article 21
In the event that the General Meeting of Shareholders does not approve the plan for a Merger or Consolidation, the Merger Statement or Consolidation Statement may only be submitted again to the Financial Services Authority at the earliest 12 (twelve) months after the implementation of said General Meeting of Shareholders.

CHAPTER IV
REPORT ON THE IMPLEMENTATION OF MERGER OR CONSOLIDATION

Article 22
The resulting company from a Merger or Consolidation is required to submit a report to the Financial Services Authority regarding the results of the implementation of the Merger or Consolidation, no later than 5 (five) working days after the effective date of the Merger or Consolidation.

CHAPTER V
OTHER PROVISIONS

Article 23
(1) A Public Company planning to conduct a Merger or Consolidation may announce information openness regarding the plan for a Merger or Consolidation before announcing the summary of the draft Merger or Consolidation as referred to in Article 8 paragraph (1). (2) In the event that a Public Company planning to conduct a Merger or Consolidation announces information openness regarding the plan for a Merger or Consolidation as referred to in paragraph (1), every piece of information regarding the development of the plan for a Merger or Consolidation must be announced. (3) In the event that information regarding the plan for a Merger or Consolidation is known by parties other than insiders, the Public Company planning to conduct a Merger or Consolidation is required to submit a report on information or material facts to the Financial Services Authority and announce it to the public in accordance with the Financial Services Authority Regulation on Openness of Information or Material Facts by Issuers or Public Companies. (4) Announcements as referred to in paragraph (1) and paragraph (2) must be conducted at least through:
a. 1 (one) daily newspaper in the Indonesian language with national circulation or the Stock Exchange Website; and b. The Public Company's Website.

Article 24
In the event that the shares of a Public Company conducting a Merger or Consolidation are listed on a Stock Exchange, such Public Company is required to follow the regulations of the Stock Exchange where the Public Company's shares are listed.

Article 25
Capital increases in the context of a Merger or Consolidation are exempt from the obligations as regulated in the Financial Services Authority Regulation on Capital Increases of Public Companies by Exercising Preemptive Rights.

CHAPTER VI
SANCTION PROVISIONS

Article 26
(1) Without prejudice to criminal provisions in the capital market sector, the Financial Services Authority has the authority to impose administrative sanctions on any party that violates the provisions of this Financial Services Authority Regulation, including parties causing the violation, 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 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 prior imposition of an administrative sanction in the form of a written warning as referred to in paragraph (1) letter a. (3) Administrative sanctions in the form of a fine as referred to in paragraph (1) letter b may be imposed independently or together with the imposition of administrative sanctions as referred to in paragraph (1) letters c, d, e, f, or g.

Article 27
In addition to administrative sanctions as referred to in Article 26 paragraph (1), the Financial Services Authority may take specific actions against any party that violates the provisions of this Financial Services Authority Regulation.

Article 28
The Financial Services Authority may announce the imposition of administrative sanctions as referred to in Article 26 paragraph (1) and specific actions as referred to in Article 27 to the public.

CHAPTER VII
TRANSITIONAL PROVISIONS

Article 29
For Public Companies planning to conduct a Merger or Consolidation before this Financial Services Authority Regulation takes effect, the Merger or Consolidation by said Public Companies shall continue to follow the provisions as regulated in Regulation Number IX.G.1, appendix of the Decision of the Head of the Capital Market Supervisory Board Number: Kep-52/PM/1997 dated December 26, 1997 regarding Merger or Consolidation of Public Companies or Issuers, provided that they have submitted to the Financial Services Authority:
a. the agenda of the General Meeting of Shareholders in the context of a Merger or Consolidation; or b. the Merger Statement or Consolidation Statement, whichever comes first.

CHAPTER VIII
CLOSING PROVISIONS

Article 30
Upon the taking effect of this Financial Services Authority Regulation, the Decision of the Head of the Capital Market Supervisory Board Number: Kep-52/PM/1997 dated December 26, 1997 regarding Merger or Consolidation of Public Companies or Issuers, along with Regulation Number IX.G.1 which is its appendix, is revoked and declared invalid.

Article 31
This Financial Services Authority Regulation takes effect upon being enacted.

To ensure that everyone knows it, it is ordered to enact this Financial Services Authority Regulation by placing it in the State Gazette of the Republic of Indonesia.

Established in Jakarta on December 23, 2016
CHAIRMAN OF THE COMMISSIONERS BOARD
FINANCIAL SERVICES AUTHORITY, signed
MULIAMAN D. HADAD

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

STATE GAZETTE OF THE REPUBLIC OF INDONESIA YEAR 2016 NUMBER 307 Copy in accordance with the original Legal Director 1 Legal Department signed Yuliana

EXPLANATION
OF
FINANCIAL SERVICES AUTHORITY REGULATION
NUMBER 74 /POJK.04/2016
ON
MERGER OR CONSOLIDATION OF PUBLIC COMPANIES

I. GENERAL
In the era of the global market, competition in the business world is increasingly fierce. Companies compete to develop their strategies to continue to grow. One of the efforts made includes increasing the efficiency of business activities, increasing production capacity, and increasing synergy between business lines within the business group. The increase in efficiency expected to be obtained through a Merger or Consolidation includes, among others, the simplification of ownership structure, organization, operations, and production. In the Capital Market, the implementation of a Merger or Consolidation by Public Companies is carried out with the aim of developing business activities or business lines.

Currently, regulations regarding Merger or Consolidation by Public Companies are regulated in Regulation Number IX.G.1, appendix of the Decision of the Head of the Capital Market Supervisory Board Number: Kep-52/PM/1997 dated December 26, 1997 regarding Merger or Consolidation of Public Companies or Issuers. Generally, the provisions in Regulation Number IX.G.1 are already quite complete in regulating the requirements and procedures that must be fulfilled and the information openness that must be submitted to the public.

However, regulations regarding Merger or Consolidation currently in force still need to be improved. This improvement is carried out with the aim of protecting investors, especially public shareholders, maintaining the orderly, fair, transparent, and accountable operation of the Capital Market, and providing ease for Public Companies planning to conduct a Merger or Consolidation under certain conditions and requirements, as well as increasing the quality of information openness in the draft Merger or Consolidation.

The improvement to the regulations regarding Merger or Consolidation previously in force is carried out by adding new provisions in this Financial Services Authority Regulation, namely among others:
a. simplification of information openness in the event that a Merger or Consolidation is conducted between a parent company and a subsidiary owned 100% (one hundred percent); and b. improvement of the quality of information openness and protection for shareholders, by adding information openness in the draft Merger or Consolidation, among others related to:

1. business activities, capital structure and shareholders, as well as management and supervision;
2. summary of the Appraiser's assessment results on the value of shares and the Appraiser's opinion on the fairness of the Merger or Consolidation;
3. business plans after the Merger or Consolidation;
4. additional information on the new prospective Controller; and
5. information regarding management's analysis and discussion of the company that will conduct a Merger or Consolidation.

Based on the background thinking and aspects thereof, it is necessary to change the legislation in the capital market sector regulating Merger or Consolidation of Public Companies or Issuers, namely the Decision of the Head of the Capital Market Supervisory Board Number: Kep-52/PM/1997 dated December 26, 1997 regarding Merger or Consolidation of Public Companies or Issuers, along with Regulation Number IX.G.1 which is its appendix, by issuing a Financial Services Authority Regulation on Merger or Consolidation of Public Companies.

II. ARTICLE BY ARTICLE

Article 1
Clear enough.

Article 2
Clear enough.

Article 3
Paragraph (1)
Clear enough.
Paragraph (2)
The Board of Commissioners' approval as referred to in this paragraph may be signed by:
a. the Chief Commissioner; or b. 1 (one) or more members of the Board of Commissioners representing the company as regulated in the Articles of Association.

Article 4
Paragraph (1)
Letter a
Clear enough.
Letter b
Clear enough.
Letter c
Clear enough.
Letter d
Clear enough.
Letter e
The term "reasons and explanations" refers to explanations, among others, from the perspective of the business development of each company and the sustainability of the Public Company's business, as well as the reasons for choosing to conduct a Merger or Consolidation rather than other corporate actions. Letter f Clear enough. Letter g Clear enough. Letter h Clear enough. Letter i Clear enough. Letter j Clear enough. Letter k Clear enough. Letter l Clear enough. Letter m The term "expert" refers to a party competent in a specific field. For example, a mining expert who provides an assessment of the assets of a company operating in the mining business. Letter n Clear enough. Letter o Clear enough. Letter p Clear enough. Letter q Clear enough. Letter r Clear enough. Paragraph (2) Letter a Clear enough. Letter b The ownership of the Subsidiary Company as referred to in this letter, taking into account the provisions of Law Number 40 of 2007 concerning Limited Liability Companies.

Article 5
The Board of Directors' statement as referred to in this Article may be signed by:
a. the President Director; or b. 1 (one) or more members of the Board of Directors representing the company as regulated in the Articles of Association.

Article 6
Paragraph (1)
The term "material changes to the nature of the Public Company resulting from a Merger or Consolidation" includes, among others, changes to the Main Business Activities of the Public Company. Paragraph (2) Clear enough.

Article 7
Letter a
Number 1
The term "affiliation" refers to affiliation as referred to in Law Number 8 of 1995 concerning the Capital Market.
Number 2
Letter a)
Clear enough.
Letter b)
Clear enough.
Letter c)
Clear enough.
Letter d)
Clear enough.
Letter e)
Clear enough.
Letter f)
Clear enough.
Letter g)
Clear enough.
Letter h)
In practice, the term "beneficiary" is also known as beneficial owner.
Letter i)
Clear enough.
Letter b
Clear enough.

Article 8
Paragraph (1)
Clear enough.
Paragraph (2)
Letter a
Clear enough.
Letter b
The announcement of the summary of the draft Merger or Consolidation is carried out without reducing the substance in the draft Merger or Consolidation.
Paragraph (3)
Clear enough.
Paragraph (4)
Proof of announcement on the Stock Exchange Website is submitted by the Public Company to the Financial Services Authority in the form of a print screen.

Article 9
Clear enough.

Article 10
Clear enough.

Article 11
Paragraph (1)
Letter a
The term "in original form" refers to printed documents signed using a writing instrument, or commonly known as a wet signature.
Letter b
Copies of electronic documents as referred to in this letter may be submitted using digital media such as compact disc (CD), flash drive, or others.
Paragraph (2)
Clear enough.
Paragraph (3)
Clear enough.
Paragraph (4)
Clear enough.
Paragraph (5)
Clear enough.
Paragraph (6)
Letter a
Clear enough.
Letter b
The ownership of the Subsidiary Company as referred to in this letter, taking into account the provisions of Law Number 40 of 2007 concerning Limited Liability Companies.

Article 12
Clear enough.

Article 13
Paragraph (1)
The submission of the Merger Statement by a Public Company receiving a Merger does not eliminate the obligation to fulfill the provisions of each company conducting the Merger as regulated in this Financial Services Authority Regulation. Paragraph (2) The submission of the Consolidation Statement by one of the Public Companies conducting a Consolidation does not eliminate the obligation to fulfill the provisions of each company conducting the Consolidation as regulated in this Financial Services Authority Regulation.

Article 14
Paragraph (1)
The request for changes and/or additional information by the Financial Services Authority is intended so that Public Companies can fulfill their obligation to disclose all material facts regarding the relevant Merger or Consolidation and the financial condition and business activities of the company. Paragraph (2) Clear enough. Paragraph (3) Clear enough. Paragraph (4) Clear enough. Paragraph (5) Clear enough.

Article 15
Clear enough.

Article 16
Clear enough.

Article 17
Clear enough.

Article 18
Clear enough.

Article 19
Clear enough.

Article 20
Upon the taking effect of this Financial Services Authority Regulation, the legislation in the capital market sector regulating affiliated transactions and certain transactions involving conflicts of interest in force is Regulation Number IX.E.1, appendix of the Decision of the Head of the Capital Market Supervisory Board and Financial Institution Supervisory Board Number: Kep-412/BL/2009 dated November 25, 2009 regarding Affiliated Transactions and Conflicts of Interest in Certain Transactions.

Article 21
Clear enough.

Article 22
The term "effective date of the Merger" includes, among others:
a. the date of approval by the Minister of Law and Human Rights regarding the amendment of the Articles of Association; b. the date the notification of the Articles of Association of the resulting company from the Merger is received by the Minister of Law and Human Rights; or
c. the effective date of the Merger determined in the merger deed.
The term "effective date of the Consolidation" is the date of the decision of the Minister of Law and Human Rights regarding the legalization of the legal entity of the resulting company from the Consolidation.

Article 23
Paragraph (1)
Information regarding the plan for a Merger or Consolidation constitutes insider information as referred to in Article 95, Article 96, and Article 97 of Law Number 8 of 1995 concerning the Capital Market if the Public Company planning to conduct a Merger or Consolidation decides not to announce information openness regarding the plan for a Merger or Consolidation. Paragraph (2) Clear enough. Paragraph (3) The term "insider" in this paragraph refers to:
a. members of the Board of Commissioners, members of the Board of Directors, or company employees; b. major shareholders of the company;
c. individuals who, due to their position or profession or due to their business relationship with the company, enable such individuals to obtain insider information; or
d. parties who within the last 6 (six) months are no longer parties as referred to in letters a, b, or c.
The term "major shareholder" as referred to in letter b refers to a party who, 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. The term "position" as referred to in letter c refers to a position in a government agency, institution, or body. The term "business relationship" as referred to in letter c refers to employment or partnership relationships in business activities, including customer, supplier, contractor, client, and creditor relationships. The term "information or material facts" refers to important and relevant information or facts regarding events, occurrences, or facts that can influence the price of Securities on the Stock Exchange and/or the decision of investors, prospective investors, or other interested parties regarding such information or facts. Paragraph (4) Clear enough.

Article 24
Clear enough.

Article 25
Clear enough.

Article 26
Clear enough.

Article 27
The term "specific actions" includes, among others, the postponement of the issuance of an effective statement for a Merger Statement or Consolidation Statement.

Article 28
The Financial Services Authority may announce the imposition of administrative sanctions and specific actions through the Financial Services Authority Website or the Financial Services Authority's annual report.

Article 29
Clear enough.

Article 30
Clear enough.

Article 31
Clear enough.

SUPPLEMENT TO THE STATE GAZETTE OF THE REPUBLIC OF INDONESIA NUMBER 5997