Provision of Order Funds, Verification of Fund Availability, Allocation of Securities for Centralized Allotment, and Settlement of Securities Orders in Electronic Equity Stock Public Offerings

To:

1. The Board of Directors of the Issuer;
2. The Board of Directors of the Securities Company;
3. The Board of Directors of the Stock Exchange;
4. The Board of Directors of the Custodian and Clearing Institution;
5. The Board of Directors of the Clearing and Guarantee Institution;
6. The Board of Directors of the Securities Administration Bureau; and
7. Indonesian Capital Market Investors,
   At their respective locations.

COPY
CIRCULAR LETTER OF THE FINANCIAL SERVICES AUTHORITY REPUBLIC OF INDONESIA NUMBER 15 /SEOJK.04/2020

REGARDING

PROVISION OF ORDER FUNDS, VERIFICATION OF FUND AVAILABILITY, ALLOCATION OF SECURITIES FOR CENTRALIZED ALLOTMENT, AND SETTLEMENT OF SECURITIES ORDERS IN ELECTRONIC EQUITY STOCK PUBLIC OFFERINGS

In connection with Financial Services Authority Regulation Number 41/POJK.04/2020 regarding the Implementation of Electronic Public Offering Activities for Equity Securities, Debt Securities, and/or Sukuk (State Gazette of the Republic of Indonesia Year 2020 Number 156, Additional State Gazette of the Republic of Indonesia Number 6531) and in order to implement the electronic public offering system for equity securities in the form of stocks, it is necessary to regulate the provision of order funds, verification of fund availability, allocation of securities for centralized allotment, and settlement of securities orders in electronic equity stock public offerings in this Financial Services Authority Circular as follows:

I. GENERAL PROVISIONS

In this Financial Services Authority Circular, the following terms are meant:

1. Public Offering is the activity of offering securities conducted by an issuer to sell securities to the public based on procedures regulated in the Capital Market Law and its implementing regulations.

2. Securities are negotiable instruments, namely debt acknowledgment instruments, commercial paper, stocks, bonds, debt certificates, Units of Collective Investment Contracts, futures contracts over Securities, and every derivative of Securities.

3. Issuer is the Party conducting the Public Offering.

4. Electronic Public Offering System is an information technology system and/or facility used to carry out activities in the Public Offering as regulated in Financial Services Authority Regulations regarding the implementation of Public Offering activities for Equity Securities, Debt Securities, and/or Sukuk.

5. Electronic Public Offering System Provider which is hereinafter referred to as System Provider is the party that provides and manages the Electronic Public Offering System.

6. Electronic Public Offering System Participant which is hereinafter referred to as System Participant is a Securities Company that has obtained a business license from the Financial Services Authority or another party approved by the Financial Services Authority and has the right to use the Electronic Public Offering System.

7. Electronic Public Offering System Admin Participant which is hereinafter referred to as Admin Participant is a System Participant that holds a license as an Underwriter and is appointed by the Issuer as the party responsible for the use of the Electronic Public Offering System.

8. Initial Offering is an invitation, whether direct or indirect, using an Initial Prospectus, which among other things aims to determine the interest of potential buyers in the Securities to be offered and/or the estimated offering price of the Securities.

9. Retail Orderer is a party that submits an order for the offered Securities with an order value of at most Rp100,000,000.00 (one hundred million Rupiah).

10. Certain Allotment is a securities allotment mechanism conducted by allocating Securities to orderers according to the quantity of Securities ordered.

11. Centralized Allotment is a securities allotment mechanism conducted by collecting all Securities orders and then allotting them according to procedures as regulated in Financial Services Authority Regulations regarding the implementation of Public Offering activities for Equity Securities, Debt Securities, and/or Sukuk electronically.

12. Retail Centralized Allotment is the part of Centralized Allotment implemented for Retail Orderers.

13. Stock Exchange is the party that organizes and provides systems and/or facilities to match buy and sell offers of Securities from other parties with the aim of trading Securities among them.

14. Clearing and Guarantee Institution is the Party that organizes clearing and guarantee services for the settlement of Stock Exchange Transactions.

15. Custodian and Clearing Institution is the Party that organizes Central Custodian activities for custodian banks, Securities Companies, and other parties.

16. Stock Exchange Member is a securities broker who has obtained a business license from the Financial Services Authority and has the right to use the Stock Exchange system and/or facilities in accordance with Stock Exchange regulations.

17. Clearing Member is a Stock Exchange Member or another party, that meets the requirements to obtain clearing and guarantee services for stock exchange transaction settlement based on regulations of the Clearing and Guarantee Institution.

18. Underwriter is the Party that makes a contract with the Issuer to conduct a Public Offering for the benefit of the Issuer with or without the obligation to purchase remaining unsold Securities.

19. Securities Broker is the Party that conducts business activities of buying and selling Securities for its own behalf or for other parties.

20. Securities Company is the Party that conducts business activities as an Underwriter, Securities Broker, and/or Investment Manager.

21. Securities Administration Bureau is the Party that, based on a contract with the Issuer, implements the recording of Securities ownership and the distribution of rights related to Securities.

22. Custodian Bank is a general bank that has obtained approval from the Financial Services Authority to conduct business activities as a custodian.

23. Customer Fund Account which is hereinafter abbreviated as CFA is a fund account in the name of a customer at a bank designated by the Custodian and Clearing Institution in accordance with applicable legislation, which is administered by the Securities Broker based on power of attorney or instructions from the customer.

24. Guarantee Account is a Securities Account of the Clearing Member at the Custodian and Clearing Institution to place collateral in the form of Securities and/or funds that can be used by the Clearing and Guarantee Institution to settle stock exchange transactions and/or to settle the obligations of the Clearing Member to the Clearing and Guarantee Institution.

25. Sub-Account of Securities which is hereinafter abbreviated as SAS is the Securities account of each customer recorded in the participant's Securities account at the Custodian and Clearing Institution.

26. Guarantee Sub-Account of Securities is an SAS used by the Clearing Member's customer to place collateral in the form of Securities and/or funds that can be used by the Clearing and Guarantee Institution to settle stock exchange transactions and/or to settle the obligations of the Clearing Member's customer.

II. PROVISION OF ORDER FUNDS

1. Investors must provide funds in the Investor's CFA in an amount equal to the value of the order.

2. The System Participant and/or Securities Company where the investor is registered as a customer must transfer the order funds from the CFA to the Investor's Guarantee Sub-Account of Securities.

3. In the event there are institutional investors who are customers of a Custodian Bank that place orders for Certain Allotment, the order funds must be available in the Guarantee Sub-Account of Securities or the Guarantee Account of the System Participant that is the underwriter conducting the issuance of Securities where the investor submits the order.

4. Order funds placed in the Guarantee Sub-Account of Securities and/or Guarantee Account for orders for a certain quantity of Securities in a Public Offering through the Electronic Public Offering System as referred to in items 2 and 3 are funds after the calculation of settlement risk over the System Participant's obligations in the secondary market conducted by the Clearing and Guarantee Institution.

5. The Underwriter must provide funds in the Guarantee Sub-Account of Securities or the Guarantee Account of the Underwriter in accordance with the underwriting portion.

6. The provision of order funds as referred to in items 1 and 3 and the transfer of order funds as referred to in item 2 must be done no later than before the order verification is conducted by the System Provider.

III. VERIFICATION OF FUND AVAILABILITY FOR SECURITIES ORDERS

1. Order verification is conducted through the Electronic Public Offering System after the end of the Securities offering period.

2. Besides institutional investors who are customers of a Custodian Bank that place orders for Certain Allotment, the following provisions must be observed:

a. order verification is conducted by matching the availability of funds in the Investor's Guarantee Sub-Account of Securities and/or Guarantee Account with the order value;

b. orders will be fulfilled according to the available funds, in multiples according to the stock exchange trading unit; and

c. in the event an investor places orders for more than 1 (one) Public Offering that are being verified simultaneously, but the order funds available in the Investor's Guarantee Sub-Account of Securities and/or Guarantee Account are insufficient for all orders, the funds are used in the following order:

1. for Certain Allotment orders first compared to Centralized Allotment orders; then

2. according to the order of order submission time.

3. For orders from institutional investors who are customers of a Custodian Bank that place orders for Certain Allotment, order verification is conducted by matching the availability of funds in the Guarantee Sub-Account of Securities or Guarantee Account of each System Participant that is the underwriter conducting the issuance of Securities where the investor submits the order with the total value of all Certain Allotment orders based on the order of submission time of orders to that System Participant.

4. In the event there is more than 1 (one) Public Offering that ends at the same time and is underwritten by the same underwriter conducting the issuance, the funds available in the Guarantee Account of the underwriter conducting the issuance are used first based on the order of time the Public Offering started.

IV. CLASSIFICATION OF PUBLIC OFFERINGS

1. Public Offerings are classified into 4 (four) groups based on the total value of Securities offered.

2. The groups as referred to in item 1 are as follows:

a. Group I Public Offering: Public Offering with a total value of Securities offered, excluding other accompanying Securities, of at most Rp250,000,000,000.00 (two hundred fifty billion Rupiah);

b. Group II Public Offering: Public Offering with a total value of Securities offered, excluding other accompanying Securities, greater than Rp250,000,000,000.00 (two hundred fifty billion Rupiah) and at most Rp500,000,000,000.00 (five hundred billion Rupiah);

c. Group III Public Offering: Public Offering with a total value of Securities offered, excluding other accompanying Securities, greater than Rp500,000,000,000.00 (five hundred billion Rupiah) and at most Rp1,000,000,000,000.00 (one trillion Rupiah); and

d. Group IV Public Offering: Public Offering with a total value of Securities offered, excluding other accompanying Securities, greater than Rp1,000,000,000,000.00 (one trillion Rupiah).

V. ALLOCATION OF SECURITIES FOR CENTRALIZED ALLOTMENT

1. Allocation of Securities for Centralized Allotment is determined based on the Public Offering group as follows:

a. for Group I Public Offerings, at least 15% (fifteen percent) of the quantity of Securities offered, excluding other accompanying Securities, or at least valued at Rp20,000,000,000.00 (twenty billion Rupiah), whichever value is higher;

b. for Group II Public Offerings, at least 10% (ten percent) of the quantity of Securities offered, excluding other accompanying Securities, or at least valued at Rp37,500,000,000.00 (thirty-seven billion five hundred million Rupiah), whichever value is higher;

c. for Group III Public Offerings, at least 7.5% (seven point five percent) of the quantity of Securities offered, excluding other accompanying Securities, or at least valued at Rp50,000,000,000.00 (fifty billion Rupiah), whichever value is higher; and

d. for Group IV Public Offerings, at least 2.5% (two point five percent) of the quantity of Securities offered, excluding other accompanying Securities, or at least valued at Rp75,000,000,000.00 (seventy-five billion Rupiah), whichever value is higher.

2. In the event that for Group I Public Offerings as referred to in item 1 letter a, the total value of Securities offered, excluding other accompanying Securities, is smaller than or equal to Rp20,000,000,000.00 (twenty billion Rupiah), then the entire value of Securities offered must be allocated for Centralized Allotment.

3. In the event the Underwriter conducts best effort underwriting, the fulfillment of allocation as referred to in item 1 (one) must still be fulfilled in the underwriting portion.

4. In table form, the allocation limits of Securities as referred to in item 1 (one) above are as follows:

Public Offering Group	Limit of Public Offering Value (IPO)	Allocation of Securities
Group I Public Offering	IPO ≤ Rp250 billion	≥ 15% or valued at Rp 20 billion*
Group II Public Offering	Rp250 billion < IPO ≤ Rp500 billion	≥ 10% or valued at Rp 37.5 billion*
Group III Public Offering	Rp500 billion < IPO ≤ Rp1 trillion	≥ 7.5% or valued at Rp 50 billion*
Group IV Public Offering	IPO > Rp1 trillion	≥ 2.5% or valued at Rp 75 billion*

• whichever value is higher.

5. Allocation of Securities for Centralized Allotment for all Public Offering groups as referred to in item 1 is allocated for Retail Centralized Allotment and Non-Retail Centralized Allotment with a ratio of 1:2 (one to two).

VI. ADJUSTMENT OF ALLOCATION FOR CENTRALIZED ALLOTMENT

1. In the event there is an oversubscription in Centralized Allotment compared to the allocation limit of Securities as referred to in item V item 1, the allocation of Securities for Centralized Allotment is adjusted according to the following provisions:

a. for Group I Public Offerings, if the subscription level in Centralized Allotment compared to the minimum percentage allocation limit of Securities:

1. reaches 2.5 (two point five) times but is less than 10 (ten) times, the allocation of Securities is adjusted to at least 17.5% (seventeen point five percent) of the quantity of Securities offered, excluding other accompanying Securities;

2. reaches 10 (ten) times but is less than 25 (twenty-five) times, the allocation of Securities is adjusted to at least 20% (twenty percent) of the quantity of Securities offered, excluding other accompanying Securities; or

3. reaches 25 (twenty-five) times or more, the allocation of Securities is adjusted to at least 25% (twenty-five percent) of the quantity of Securities offered, excluding other accompanying Securities;

b. for Group II Public Offerings, if the subscription level in Centralized Allotment compared to the minimum percentage allocation limit of Securities:

1. reaches 2.5 (two point five) times but is less than 10 (ten) times, the allocation of Securities is adjusted to at least 12.5% (twelve point five percent) of the quantity of Securities offered, excluding other accompanying Securities;

2. reaches 10 (ten) times but is less than 25 (twenty-five) times, the allocation of Securities is adjusted to at least 15% (fifteen percent) of the quantity of Securities offered, excluding other accompanying Securities; or

3. reaches 25 (twenty-five) times or more, the allocation of Securities is adjusted to at least 20% (twenty percent) of the quantity of Securities offered, excluding other accompanying Securities;

c. for Group III Public Offerings, if the subscription level in Centralized Allotment compared to the minimum percentage allocation limit of Securities:

1. reaches 2.5 (two point five) times but is less than 10 (ten) times, the allocation of Securities is adjusted to at least 10% (ten percent) of the quantity of Securities offered, excluding other accompanying Securities;

2. reaches 10 (ten) times but is less than 25 (twenty-five) times, the allocation of Securities is adjusted to at least 12.5% (twelve point five percent) of the quantity of Securities offered, excluding other accompanying Securities; or

3. reaches 25 (twenty-five) times or more, the allocation of Securities is adjusted to at least 17.5% (seventeen point five percent) of the quantity of Securities offered, excluding other accompanying Securities; and

d. for Group IV Public Offerings, if the subscription level in Centralized Allotment compared to the minimum percentage allocation limit of Securities:

1. reaches 2.5 (two point five) times but is less than 10 (ten) times, the allocation of Securities is adjusted to at least 5% (five percent) of the quantity of Securities offered, excluding other accompanying Securities;

2. reaches 10 (ten) times but is less than 25 (twenty-five) times, the allocation of Securities is adjusted to at least 7.5% (seven point five percent) of the quantity of Securities offered, excluding other accompanying Securities; or

3. reaches 25 (twenty-five) times or more, the allocation of Securities is adjusted to at least 12.5% (twelve point five percent) of the quantity of Securities offered, excluding other accompanying Securities.

2. In table form, the adjustment of allocation of Securities as referred to in item 1 above is as follows:

Public Offering Group	Percentage of Allocation of Securities	Subscription Level and Allocation Adjustment
		Adjustment I (2.5x ≤ X < 10x)	Adjustment II (10x ≤ X < 25x)	Adjustment III (≥ 25x)
I	≥ 15%	≥ 17.5%	≥ 20%	≥ 25%
II	≥ 10%	≥ 12.5%	≥ 15%	≥ 20%
III	≥ 7.5%	≥ 10%	≥ 12.5%	≥ 17.5%
IV	≥ 2.5%	≥ 5%	≥ 7.5%	≥ 12.5%

3. The quantity of Securities reallocated to meet the provisions for adjustment of allocation of Securities for the Centralized Allotment portion is divided for Retail Centralized Allotment and Non-Retail Centralized Allotment according to the ratio as referred to in item V item 5.

4. In the event the allocation of Securities for Centralized Allotment has already exceeded the minimum adjustment limit of allocation of Securities as referred to in item 1, the allocation of Securities for Centralized Allotment does not need to be adjusted.

5. Sources of Securities that can be used to meet the provisions for adjustment of allocation of Securities for the Centralized Allotment portion are:

a. Securities allocated for the Certain Allotment portion;

b. Securities owned by the Issuer's shareholders, which are not prohibited from being transferred in accordance with Financial Services Authority Regulations regarding restrictions on shares issued prior to the Public Offering;

c. New Securities issued by the Issuer other than those already offered through the Public Offering; and/or

d. Securities resulting from the Issuer's repurchase of Securities (buyback).

6. In the event the source of Securities uses Securities allocated for the Certain Allotment portion as referred to in item 5 letter a, the fulfillment of investor orders in Certain Allotment is conducted by distributing the Certain Allotment portion after being reduced by the adjustment of allocation of Securities:

a. proportionally for all investors based on the quantity of orders; or

b. based on the decision of the underwriter conducting the issuance in the event the underwriter conducting the issuance provides special treatment to certain investors with the following provisions:

1. Certain Allotment investors receiving special treatment will only be subject to proportional adjustment of allocation of Securities after Certain Allotment investors not receiving special treatment do not receive allocation of Securities due to the adjustment;

2. investors given special treatment as referred to in item 1) are determined and input into the Electronic Public Offering System before the end of the Securities offering period; and

3. the underwriter conducting the issuance must notify each investor affected by the adjustment of allocation of Securities.

c. In the event there is a shortage of Securities due to adjustment allocation as referred to in letters a and b, the shortage of Securities is fulfilled from investors in Certain Allotment who are adjusted based on the order of submission time of the latest orders.

7. In the event the quantity of Securities ordered by investors in the Centralized Allotment allocation exceeds the quantity of Securities allocated for Centralized Allotment, including after considering the existence of adjustment of allocation of Securities as referred to in item 1, the allotment of Securities is conducted by the Electronic Public Offering System with the following mechanism:

a. in Retail Centralized Allotment and Non-Retail Centralized Allotment, for each investor, allotment of Securities is conducted first up to a maximum of 10 (ten) trading units or according to their order for orders of less than 10 (ten) trading units;

b. in the event the quantity of Securities available in trading units is less than the quantity of investors so as not to be sufficient to fulfill allotment as referred to in letter a, the Securities are allocated to investors who placed orders in Centralized Allotment according to the order of order submission time.

Example:
Securities available amount to 100,000 trading units and the quantity of investors placing orders amounts to 125,000 parties. Thus, the quantity of Securities is not sufficient to allot first 1 (one) trading unit each for every investor. In this condition, the allotment of Securities is conducted by allocating 100,000 trading units for the first 100,000 investors based on the order of submission time of orders in Centralized Allotment with a quantity of 1 (one) trading unit each.

c. in the event there are still remaining Securities after allotment as referred to in letter a, the remaining Securities are allocated proportionally in trading units based on the remaining quantity of orders that have not been fulfilled;

d. in the event the calculation of proportional allotment results in a fraction of a trading unit, rounding down is conducted; and

e. in the event there are remaining Securities resulting from the rounding of proportional allotment of Securities as referred to in letter d, the remaining Securities are allocated to investors whose orders have not been fulfilled based on the order of submission time of each order, 1 (one) trading unit at a time until the remaining Securities are exhausted.

VII. SETTLEMENT OF SECURITIES ORDERS

1. Settlement of securities orders through the Electronic Public Offering System is conducted as follows:

a. calculating the Securities resulting from allotment for each order received in Centralized Allotment and Certain Allotment;

b. calculating the total Securities to be distributed;

c. calculating the settlement fund obligation for each order that will receive the allotment result for orders through Centralized Allotment and Certain Allotment;

d. calculating the total funds to be received by the Issuer through the Admin Participant as the underwriter conducting the issuance;

e. sending information on the total Securities that must be provided to the Issuer or the Securities Administration Bureau appointed by the Issuer; and

f. the calculation of Securities as referred to in letters a and b includes accompanying Securities according to the ratio established by the Issuer, in the event the Public Offering by the Issuer is accompanied by the issuance of other Securities.

2. The Issuer or the Securities Administrator designated by the Issuer makes a deposit of the total amount of Securities to be provided based on the Electronic Public Offering System into the Participant Admin's Securities account at the Securities Clearing and Settlement Institution.

3. The deposit referred to in item 2 includes other Securities accompanying it according to the ratio established by the Issuer, in the event that the Public Offering by the Issuer is accompanied by the issuance of other Securities.

4. In the process of fund transfer and securities distribution, the following actions are taken:

a. The System Provider withdraws funds from the Guarantee Securities Sub-account and/or the Guarantee Account for each order according to the allocation results, after prior calculation of settlement risk regarding the System Participant's obligations in the secondary market by the Clearing and Guarantee Institution.

b. The System Provider transfers all funds as referred to in letter a to the Depositor Participant Admin's Securities account and simultaneously transfers all Securities from the Admin Participant as the issuing underwriter to be distributed to the Guarantee Securities Sub-account and/or the Investor's Guarantee Account receiving allocation.

c. In the event of insufficient order funds, the System Provider only transfers the amount of funds available in the Guarantee Securities Sub-account and/or the Guarantee Account, and distributes Securities according to the available funds.

d. In the event that the Public Offering by the Issuer is accompanied by the issuance of other Securities, the System Provider also distributes the accompanying Securities according to the ratio established by the Issuer.

e. Specifically for investors who are clients of Custodian Banks making orders for Fixed Allocation, Securities are distributed to the Guarantee Securities Sub-account or the Guarantee Account of the System Participant acting as the issuing underwriter.

This copy corresponds to the original
Legal Director 1
Legal Department signed
Mufli Asmawidjaja

f. The Admin Participant transfers the proceeds from the Public Offering to the Issuer.

VIII. CLOSING
This Circular Letter of the Financial Services Authority takes effect on the date of determination.
Determined in Jakarta on July 27, 2020
EXECUTIVE HEAD OF CAPITAL MARKET SUPERVISOR
FINANCIAL SERVICES AUTHORITY
REPUBLIC OF INDONESIA, signed
HOESEN