Regulation of the Financial Services Authority of the Republic of Indonesia Number 25 of 2023 Concerning the Conduct of Business of Venture Capital Companies and Sharia Venture Capital Companies

FINANCIAL SERVICES AUTHORITY
REPUBLIC OF INDONESIA
COPY
REGULATION OF THE FINANCIAL SERVICES AUTHORITY OF THE REPUBLIC OF INDONESIA NUMBER 25 OF 2023 CONCERNING THE CONDUCT OF BUSINESS OF VENTURE CAPITAL COMPANIES AND SHARIA VENTURE CAPITAL COMPANIES BY THE GRACE OF GOD THE ALMIGHTY THE COMMISSIONERS OF THE FINANCIAL SERVICES AUTHORITY, Considering: that in order to implement the mandate of Article 106 paragraph (6),
Article 107 paragraph (4), Article 112 paragraph (3), Article 116 paragraph (3),
Article 122 paragraph (3), Article 123 paragraph (2), Article 128 paragraph (4),
and Article 282 paragraph (3) of Law Number 4 of 2023 concerning the Development and Strengthening of the Financial Sector and to support the development of the industry and legal needs regarding the conduct of business of venture capital companies as regulated in Financial Services Authority Regulation Number 35/POJK.05/2015 concerning the Conduct of Business of Venture Capital Companies, it is necessary to establish a Financial Services Authority Regulation concerning the Conduct of Business of Venture Capital Companies and Sharia Venture Capital Companies; Recalling: 1. 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) as amended by Law Number 4 of 2023 concerning the Development and Strengthening of the Financial Sector (State Gazette of the Republic of Indonesia Year 2023 Number 4, Supplement to the State Gazette of the Republic of Indonesia Number 6845);
2. Law Number 4 of 2023 concerning the Development and
Strengthening of the Financial Sector (State Gazette of the Republic of Indonesia Year 2023 Number 4, Supplement to the State Gazette of the Republic of Indonesia Number 6845);

RESOLVES:
Determining: FINANCIAL SERVICES AUTHORITY REGULATION CONCERNING THE CONDUCT OF BUSINESS OF VENTURE CAPITAL COMPANIES AND SHARIA VENTURE CAPITAL COMPANIES.

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

Venture Capital Business is a financing activity through capital participation and/or financing for a
specific period of time in order to develop businesses of business partners or debtors.
Sharia Venture Capital Business is a financing activity through capital participation and/or financing for a
specific period of time in order to develop businesses of business partners or customers conducted based on Sharia principles.
Venture Capital Company, hereinafter abbreviated as PMV, is a business entity that conducts Venture Capital Business activities.
Sharia Venture Capital Company, hereinafter abbreviated as PMVS, is a business entity whose entire business activities conduct Sharia Venture Capital Business activities.
Sharia Principles are Islamic legal principles based on fatwas and/or Sharia compliance statements issued by institutions having authority in determining fatwas in the Sharia field.
Sharia Business Unit, hereinafter abbreviated as UUS, is a work unit of the PMV headquarters that conducts Sharia Venture Capital Business activities and/or functions as the head office of offices conducting Sharia Venture Capital Business activities.
Company refers to PMV and PMVS.
Joint Investment Contract is a contract between PMV or PMVS and a custodian bank that binds venture capital unit holders, whereby PMV or PMVS is given authority to manage funds from venture capital unit holders and the custodian bank is given authority to conduct collective custody.
Venture Fund is a fund that pools and manages funds belonging to unit holders in the Joint Investment Contract.
Custodian Bank is a commercial bank and Sharia commercial bank that has obtained approval from the Financial Services Authority as a custodian.
Venture Capital Unit is an instrument issued by the Venture Fund to unit holders as proof of ownership of the Venture Fund.
Trustee is a party representing the interests of holders of debt securities, including those conducted based on Sharia Principles.
Net Asset Value is the difference between the assets and liabilities of the Venture Fund.
Business Partner is a business entity that receives capital participation from the Company.
Debtor is an individual or business entity that receives financing from PMV.
Customer is an individual or business entity that receives profit-sharing financing from PMVS or UUS.
Divestment is the sale of shares of Business Partners owned by the Company or the Venture Fund.
Maximum Financing Limit, hereinafter abbreviated as BMPP, is a specific limit in the disbursement of financing permitted under this Financial Services Authority Regulation.
General Meeting of Shareholders, hereinafter abbreviated as GMS, is a company organ that has authority not given to the board of directors or board of commissioners within the limits determined in legislation concerning limited liability companies and/or the articles of association for Companies in the form of a limited liability company legal entity, or equivalent to GMS for Companies in the form of a cooperative legal entity.
General Meeting of Venture Capital Unit Holders is a general meeting convened at the initiative of the Venture Fund management Company, Custodian Bank, and/or representatives of Venture Capital Unit holders for the purpose of oversight and transparency of Venture Fund management.
Board of Directors is a Company organ authorized and fully responsible for the management of the Company for the benefit of the Company, in accordance with the purpose and objectives of the Company and representing the Company, both inside and outside of court, in accordance with the provisions of the articles of association for Companies in the form of a limited liability company legal entity, or equivalent to the Board of Directors for Companies in the form of a cooperative legal entity.
Board of Commissioners is a Company organ tasked with conducting general and/or specific oversight in accordance with the articles of association and providing advice to the Board of Directors for Companies in the form of a limited liability company legal entity, or equivalent to the Board of Commissioners for Companies in the form of a cooperative legal entity.
Sharia Supervisory Board, hereinafter abbreviated as DPS, is a party that has the task and function of overseeing the conduct of Company activities to ensure compliance with Sharia Principles.
Paid-up Capital is paid-up capital for Companies in the form of a limited liability company legal entity or
equivalent for Companies in the form of a cooperative legal entity.
Equity is equity based on applicable financial accounting standards in Indonesia.

CHAPTER II
BUSINESS ACTIVITIES
Section One
Types of Business Activities
Article 2
PMV conducts Venture Capital Business activities which include:
a. capital participation; b. participation through the purchase of convertible bonds;
c. financing through the purchase of debt securities issued by Business Partners in the initial startup stage and/or business development stage; and/or
d. financing.
Article 3
PMVS and UUS conduct Sharia Venture Capital Business activities which include:
a. capital participation; b. participation through the purchase of convertible sukuk;
c. financing through the purchase of sukuk issued by Business Partners in the initial startup stage and/or business development stage; and/or
d. financing based on profit-sharing principles.
Article 4
PMVS and UUS are prohibited from conducting sales financing except to Business Partners or Customers who are currently or have previously received Sharia Venture Capital Business activities as referred to in Article 3.
Article 5
(1) PMVS and UUS in conducting Sharia Venture Capital Business activities as referred to in Article 3 must use contracts that do not contradict Sharia Principles.
(2) PMVS and UUS in conducting Sharia Venture Capital Business activities as referred to in Article 3 must allocate to Business Partners or Customers whose business activities do not contradict Sharia Principles. (3) Fulfillment of Sharia Principles as referred to in paragraph (1) in the use of contracts must be supported by fatwas and/or Sharia compliance statements issued by institutions having authority in determining fatwas in the Sharia field. (4) In the event that fatwas and/or Sharia compliance statements as referred to in paragraph (3) have not been issued, the fulfillment of Sharia Principles must be supported by an opinion from the DPS of PMVS and UUS regarding the use of specific contracts for business activities.
Article 6
(1) In conducting Venture Capital Business activities as referred to in Article 2 and Sharia Venture Capital Business activities as referred to in Article 3, Companies may manage Venture Funds.
(2) In managing Venture Funds as referred to in paragraph (1), PMVS and UUS must act based on Sharia Principles.
Article 7
The conduct of business activities by PMVS and UUS must fulfill the principles of justice ('adl), balance (tawazun), benefit (maslahah), and universalism (alamiyah) and must not contain gharar (uncertainty), maysir (gambling), riba (usury/interest), zhulm (oppression), risywah (bribery), and haram objects.
Article 8
Venture Capital Business activities as referred to in Article 2 and/or Sharia Venture Capital Business activities as referred to in Article 3 may be accompanied by mentoring for Business Partners and/or Debtors/Customers.

Section Two
Company Categories
Article 9
(1) Companies must conduct business activities according to categories:
a. Companies that focus on:

capital participation activities as referred to in Article 2 letter a and/or participation through the purchase of convertible bonds as referred to in Article 2 letter b, for PMV;
capital participation activities as referred to in Article 3 letter a and/or participation through the purchase of convertible sukuk as referred to in Article 3 letter b, for PMVS and UUS; and/or
management of Venture Funds as referred to in Article 6 paragraph (1),
called as Companies in the form of venture capital corporations; or b. Companies that focus on:
financing through the purchase of debt securities issued by Business Partners in the initial startup stage and/or business development stage as referred to in Article 2 letter c and/or financing as referred to in Article 2 letter d, for PMV; and/or
financing through the purchase of sukuk issued by Business Partners in the initial startup stage and/or business development stage as referred to in Article 3 letter c and/or financing based on profit-sharing principles as referred to in Article 3 letter d, for PMVS and UUS,
called as Companies in the form of venture debt corporations.
(2) Companies in the form of venture capital corporations as referred to in paragraph (1) letter a may conduct:
a. financing through the purchase of debt securities issued by Business Partners in the initial startup stage and/or business development stage as referred to in Article 2 letter c and/or financing as referred to in Article 2 letter d, for PMV; or b. financing through the purchase of sukuk issued by Business Partners in the initial startup stage and/or business development stage as referred to in Article 3 letter c and/or financing activities based on profit-sharing principles as referred to in Article 3 letter d, for PMVS and UUS.

Section Three
Fee-Based Activities and Other Activities
Article 10
In addition to conducting Venture Capital Business activities as referred to in Article 2 and Sharia Venture Capital Business activities as referred to in Article 3, Companies may conduct:
a. fee-based activities; and/or b. other activities with the approval of the Financial Services Authority.
Article 11
Companies and UUS that will conduct fee-based activities as referred to in Article 10 letter a must report to the Financial Services Authority by attaching documents that at least include:
a. description of the fee-based products to be marketed; b. description of the marketing mechanism;
c. description of the rights and obligations of the parties;
d. draft cooperation agreement; and e. photocopy of licenses from competent authorities, if any.
Article 12
(1) Companies and UUS that will conduct other activities with the approval of the Financial Services Authority as referred to in Article 10 letter b must meet the requirements:
a. the plan to conduct other activities has been included in the business plan; b. have a minimum composite health rating of 2 (two) for Companies or a risk profile rating of 2 (two) for UUS; and
c. are not currently subject to administrative sanctions by the Financial Services Authority.
(2) To obtain approval as referred to in Article 10 letter b, Companies and UUS must submit an application to the Financial Services Authority by attaching documents containing descriptions of at least:
a. the scheme or mechanism of other activities to be conducted, accompanied by a description of the contracts used for PMVS or UUS; b. business prospect analysis; and
c. example of the activity agreement to be used which at least contains the rights and obligations of the parties.
(3) The Financial Services Authority provides approval or rejection of the application as referred to in paragraph (2) within a maximum period of 20 (twenty) working days from the date the application is received completely. (4) In providing approval or rejection as referred to in paragraph (3), the Financial Services Authority conducts:
a. analysis of document completeness as referred to in paragraph (2); b. analysis of compliance with provisions in this Financial Services Authority Regulation and other related regulations; and
c. analysis of the feasibility of other activities proposed.
(5) In the event that based on the analysis of document completeness as referred to in paragraph (4) letter a the documents are incomplete, the Board of Directors must submit complete documents within a maximum of 20 (twenty) working days from the date of the document completeness request letter from the Financial Services Authority. (6) In the event that the Board of Directors has submitted complete documents as referred to in paragraph (5), the Financial Services Authority provides approval or rejection in accordance with the provisions as referred to in paragraph (4). (7) If within 20 (twenty) working days from the date of the document completeness request letter as referred to in paragraph (5), the Financial Services Authority has not received a response to the document completeness request, the Company and UUS are considered to have cancelled the application for approval to conduct other activities. (8) In the event that the application for approval to conduct other activities as referred to in paragraph (2) is approved, the Financial Services Authority establishes an approval decision for conducting other activities for the Company and UUS. (9) In the event that the Financial Services Authority rejects the application for approval to conduct other activities as referred to in paragraph (2), the rejection is done in writing and accompanied by reasons for rejection.

Section Four
Objectives and Limits in Business Conduct
Article 13
(1) Venture Capital Business activities as referred to in Article 2 and Sharia Venture Capital Business activities as referred to in Article 3 are aimed at developing productive businesses for Business Partners and/or Debtors/Customers. (2) Venture Capital Business activities as referred to in Article 2 and Sharia Venture Capital Business activities as referred to in Article 3 aim to:
a. develop new discoveries; b. develop Companies and UUS or individual businesses that experience funding difficulties in the early stages of their business;
c. develop micro, small, medium enterprises and cooperatives;
d. assist companies or individual businesses that are in the development stage or business decline stage; e. take over companies or individual businesses that are in the development stage or business decline stage; f. develop research and engineering projects; g. develop various uses of new technologies and technology transfer both domestically and internationally; and/or h. assist in the transfer of company ownership.
Article 14
(1) Companies must include Venture Capital Business activities as referred to in Article 2 and/or Sharia Venture Capital Business activities as referred to in Article 3 in the articles of association. (2) Companies must ensure that the Venture Capital Business and/or Sharia Venture Capital Business activities included in the articles of association as referred to in paragraph (1) are in accordance with the categories as referred to in Article 9.
Article 15
(1) Companies and UUS must conduct feasibility analysis, business schemes, and business prospects of Business Partners when conducting capital participation in Business Partners.
(2) Companies and UUS may use appraisers in conducting feasibility analysis, business schemes, and business prospects of Business Partners as referred to in paragraph (1).
(3) In the event that Companies and UUS use appraisers as referred to in paragraph (2), Companies and UUS must use appraisers registered with the Financial Services Authority.

Section Five
Administrative Sanctions
Article 16
(1) Companies and UUS that violate provisions as referred to in Article 4, Article 5, Article 6 paragraph (2), Article 7, Article 9 paragraph (1), Article 11, Article 14, and/or Article 15 paragraph (1), paragraph (3) are subject to progressive administrative sanctions in the form of:
a. written warnings; b. suspension of part or all of the business activities; and
c. revocation of the Company's business license or revocation of the UUS license.
(2) In addition to administrative sanctions as referred to in paragraph (1), the Financial Services Authority has the authority to:
a. downgrade the health assessment results; and/or b. re-evaluate the competence and propriety of the main parties of the Company.
(3) Administrative sanctions in the form of written warnings as referred to in paragraph (1) letter a are given in writing for a maximum of 3 (three) consecutive times with a duration of each of maximum 2 (two) months. (4) In the event that before the end of the duration of the administrative sanction in the form of written warnings as referred to in paragraph (3), the Company and UUS have fulfilled the provisions as referred to in paragraph (1), the Financial Services Authority revokes the administrative sanction in the form of written warnings. (5) In the event that a violation of provisions as referred to in paragraph (1) occurs but the violation has been corrected, the Financial Services Authority provides a written warning sanction that ends automatically. (6) In the event that the duration of the third warning as referred to in paragraph (3) ends and the Company and UUS still do not fulfill the provisions as referred to in paragraph (1), the Financial Services Authority imposes administrative sanctions in the form of suspension of part or all of the business activities. (7) Administrative sanctions in the form of suspension of part or all of the business activities as referred to in paragraph (1) letter b are given in writing and take effect from the date of establishment for a maximum duration of 6 (six) months. (8) In the event that the Company and UUS are subject to administrative sanctions in the form of suspension of all business activities as referred to in paragraph (6), the Company and UUS are prohibited from conducting business activities. (9) In the event that before the end of the duration of suspension of part or all of the business activities as referred to in paragraph (6), the Company and UUS have fulfilled the provisions as referred to in paragraph (1), the Financial Services Authority revokes the administrative sanction in the form of suspension of part or all of the business activities. (10) In the event that administrative sanctions in the form of suspension of part or all of the business activities are still in effect and the Company and UUS continue to conduct business activities, the Financial Services Authority has the authority to directly impose administrative sanctions in the form of revocation of the Company's business license or revocation of the UUS license. (11) If the duration of administrative sanctions in the form of written warnings and/or suspension of part or all of the business activities ends on a holiday, the administrative sanctions in the form of written warnings and/or suspension of part or all of the business activities remain in effect until the first working day thereafter. (12) In the event that by the end of the duration of suspension of part or all of the business activities as referred to in paragraph (6), the Company and UUS still do not fulfill the provisions as referred to in paragraph (1), the Financial Services Authority revokes the business license of the Company or the UUS license
concerned. (13) The Financial Services Authority announces administrative sanctions in the form of suspension of part or all of the business activities as referred to in paragraph (1) letter b and/or revocation of the Company's business license or revocation of the UUS license as referred to in paragraph (1) letter c to the public.

CHAPTER III
COMPANIES IN THE FORM OF
VENTURE CAPITAL CORPORATIONS
Section One
General
Article 17
(1) Companies in the form of venture capital corporations as referred to in Article 9 paragraph (1) letter a must conduct capital participation, participation through the purchase of convertible bonds, and/or participation through the purchase of convertible sukuk of at least 51% (fifty-one percent) of the Company's total business activities. (2) Companies in the form of venture capital corporations as referred to in Article 9 paragraph (1) letter a must meet the limits on capital participation, participation through the purchase of convertible bonds, participation through the purchase of convertible sukuk, and/or other activities with the approval of the Financial Services Authority to Business Partners that are:
a. related parties up to a maximum of 10% (ten percent) of the Company's Equity; and/or b. unrelated parties up to a maximum of 20% (twenty percent) of the Company's Equity.
(3) Companies in the form of venture capital corporations as referred to in Article 9 paragraph (1) letter a must conduct capital participation directly to Business Partners in the form of:
a. Indonesian legal entities that are limited liability company legal entities; or b. legal entities other than Indonesian legal entities that have business activities within the territory of Indonesia, with a period agreed upon with the Business Partner, for a maximum of 10 (ten) years. (4) Companies in the form of venture capital corporations as referred to in Article 9 paragraph (1) letter a must conduct participation through the purchase of convertible bonds and/or participation through the purchase of convertible sukuk issued by Business Partners in the form of:
a. Indonesian legal entities that are limited liability company legal entities; or b. legal entities other than Indonesian legal entities that have business activities within the territory of Indonesia. (5) Companies in the form of venture capital corporations as referred to in Article 9 paragraph (1) letter a must conduct Divestment at the latest by the time of maturity of the maximum direct participation time limit so that the Company does not become the controller of the Business Partner. (6) Companies in the form of venture capital corporations as referred to in Article 9 paragraph (1) letter a must calculate and form impairment loss reserves in accordance with applicable financial accounting standards. (7) Companies in the form of venture capital corporations as referred to in Article 9 paragraph (1) letter a may conduct capital participation in Business Partners listed on the stock exchange up to a maximum of 10% (ten percent) of total capital participation. (8) Related parties as referred to in paragraph (2) letter a include:
a. individuals and/or business entities that are controllers of the Company; b. business entities where the Company acts as a controller;
c. individuals and/or business entities that act as controllers of business entities as referred to in letter b;
d. business entities whose control is conducted by:

individuals and/or business entities
as referred to in letter a; or
individuals and/or business entities
as referred to in letter c; e. members of the Board of Commissioners or members of the Board of Directors of the Company; f. parties having a family relationship due to marriage or descent up to the second degree, both horizontally and vertically:
from individuals who are controllers of the Company as
referred to in letter a; and
from members of the Board of Commissioners or members
of the Board of Directors of the Company as referred to in letter e; g. members of the board of commissioners or members of the board of directors of business entities as referred to in letters a through d; h. business entities whose board of commissioners or board of directors are:
members of the Board of Commissioners or members of
the Board of Directors of the Company; or
members of the board of commissioners or members of the board of directors
of business entities as referred to in letters a through d;
i. business entities where:
members of the Board of Commissioners or members of
the Board of Directors of the Company as referred to in letter e act as controllers; or
members of the board of commissioners or members of the board of directors
of parties as referred to in letters a through d, act as controllers; and j. business entities that have financial dependence with the Company and/or parties as referred to in letters a through i.
(9) The amount of total Equity as referred to in paragraph (2) refers to the latest monthly financial report of the Company in the form of a venture capital corporation as referred to in Article 9 paragraph (1) letter a before business activities are conducted. (10) The Company in the form of a venture capital corporation as referred to in Article 9 paragraph (1) letter a may extend the investment period as referred to in paragraph (3) for a maximum of 5 (five) years based on agreement with Business Partners. (11) The purchase of convertible bonds and/or convertible sukuk as referred to in paragraph (4) may consist of the purchase of convertible bond certificates or convertible sukuk certificates as evidence of ownership of convertible bonds or convertible sukuk and/or the purchase of convertible bonds or convertible sukuk documented in a notarial deed. (12) Convertible bonds/sukuk as referred to in paragraph (4) may be converted into equity investment at maturity for a specific period. (13) Equity investment resulting from the conversion of bonds or sukuk is equity investment as referred to in Article 2 letter a. (14) The conversion into equity investment as referred to in paragraph (12) is conducted based on an agreement agreed upon between the Company in the form of a venture capital corporation as referred to in Article 9 paragraph (1) letter a and Business Partners. (15) The provisions as referred to in paragraph (2) do not apply in cases of exceeding the maximum limit of equity investment, investment through the purchase of convertible bonds, investment through the purchase of convertible sukuk, and/or other activities with the approval of the Otoritas Jasa Keuangan caused by an increase in the value of the Business Partner's shares.

Article 18
(1) Divestment as referred to in Article 17 paragraph (5) may be conducted through the following mechanisms:
a. conducting a public offering through the capital market; b. takeover by other investors;
c. selling to another Company in the form of a venture capital corporation as referred to in Article 9 paragraph (1) letter a and/or new investors through a limited offering (private placement);
d. selling back to Business Partners (buy back); e. conducting dissolution or liquidation; and/or f. conducting other corporate actions.
(2) The public offering mechanism as referred to in paragraph (1) letter a is implemented in accordance with regulations concerning the capital market.
(3) The dissolution or liquidation mechanism as referred to in paragraph (1) letter e and other corporate actions as referred to in paragraph (1) letter f are implemented in accordance with regulations concerning limited liability companies.

Part Two
Venture Fund Management

Article 19
A Company in the form of a venture capital corporation as referred to in Article 9 paragraph (1) letter a that manages Venture Funds must obtain approval from the Otoritas Jasa Keuangan.

Article 20
Entities formed through Joint Venture Contracts for Venture Funds are equated to legal entities.

Article 21
To obtain approval as referred to in Article 19, a Company in the form of a venture capital corporation as referred to in Article 9 paragraph (1) letter a must meet the following requirements:
a. having minimum Equity of IDR 50,000,000,000.00 (fifty billion rupiah); b. having human resources and organizational structure consisting of at least divisions handling the following functions:

investment management;
research;
finance;
risk management;
internal audit;
compliance;
human resource development;
information technology; and
anti-money laundering, counter-terrorism financing, and counter-proliferation financing of weapons of mass destruction;
c. having separation of divisions handling investment management, compliance, internal audit, and risk management functions;
d. having at least 1 (one) managerial level employee in the investment management division who meets the following requirements:
Indonesian citizen;
holding an individual license as an investment manager representative;
having at least 3 (three) years of experience in a managerial position as a decision-maker in investment management, proven by an employment decision letter or assignment letter; and
not having been declared bankrupt or having been a manager declared guilty causing a company to be declared bankrupt within the last 5 (five) years before submitting the Venture Fund license application;
e. having a venture fund formation agreement plan; and f. having standard operating procedures related to Venture Fund management.

Article 22
To obtain approval as referred to in Article 19, a Company in the form of a venture capital corporation as referred to in Article 9 paragraph (1) letter a must submit a license application for each Venture Fund to the Otoritas Jasa Keuangan, attaching at least the following documents:
a. a description of the Venture Fund to be managed, including at least:

the name of the Venture Fund;
the target value of the Venture Fund to be managed;
the fund collection period for the managed Venture Fund;
the focus of allocation and distribution of the Venture Fund;
potential investor targets; and
the name of the Custodian Bank;
b. a description of the Company's human resources, completed with the number and composition of human resources in each division and the Company's organizational structure, completed with a description of the duties, responsibilities, and authority of each division;
c. a venture fund formation agreement plan, which must contain at least the rights and obligations of the parties; and
d. standard operating procedures related to Venture Fund management.

Article 23
(1) The Otoritas Jasa Keuangan provides approval or rejection of the Venture Fund management license application as referred to in Article 22 within a maximum period of 20 (twenty) working days from the date the complete application is received. (2) In providing approval or rejection as referred to in paragraph (1), the Otoritas Jasa Keuangan conducts:
a. an analysis of the fulfillment of requirements as referred to in Article 21; b. an analysis of the completeness of documents as referred to in Article 22; and
c. an analysis of the feasibility of business activities.
(3) In the event that, based on the results of the analysis of document completeness as referred to in paragraph (2) letter b, the documents are incomplete, the Board of Directors must submit the complete documents within the time limit set by the Otoritas Jasa Keuangan in the letter requesting document completeness. (4) In the event that the Board of Directors has submitted the complete documents as referred to in paragraph (3), the Otoritas Jasa Keuangan provides approval or rejection in accordance with the provisions as referred to in paragraph (2). (5) If, within the time limit as referred to in paragraph (3), the Otoritas Jasa Keuangan has not received a response to the request for document completeness, the Company in the form of a venture capital corporation as referred to in Article 9 paragraph (1) letter a is deemed to have cancelled the application. (6) In the event that the application is approved, the Otoritas Jasa Keuangan establishes the issuance of a license to conduct Venture Fund management to the Company in the form of a venture capital corporation as referred to in Article 9 paragraph (1) letter a. (7) In the event that the Otoritas Jasa Keuangan rejects the application of the Company in the form of a venture capital corporation as referred to in Article 9 paragraph (1) letter a, the rejection must be in writing and accompanied by the reasons for rejection.

Article 24
Investment risk in Venture Funds is the risk of the holders of Venture Fund Units entirely.

Part Three
Formation and Management of Venture Funds

Article 25
(1) The formation of Venture Funds is conducted between a Company in the form of a venture capital corporation as referred to in Article 9 paragraph (1) letter a and a Custodian Bank based on a Joint Investment Contract. (2) For Companies in the form of a venture capital corporation as referred to in Article 9 paragraph (1) letter a that conduct business activities based on Sharia Principles, the formation of Venture Funds as referred to in paragraph (1) must be conducted with a Custodian Bank that conducts business activities based on Sharia Principles.

Article 26
(1) A Company in the form of a venture capital corporation as referred to in Article 9 paragraph (1) letter a must meet the minimum investment value for each holder of Venture Fund Units.
(2) The minimum investment value for each holder of Venture Fund Units as referred to in paragraph (1), for the first time, is established at a minimum of IDR 1,000,000,000.00 (one billion rupiah).
(3) Provisions regarding the minimum investment value for each holder of Venture Fund Units as referred to in paragraph (2) may be adjusted based on certain considerations.
(4) Further provisions regarding the adjustment of the minimum investment value for each holder of Venture Fund Units as referred to in paragraph (3) are established by the Otoritas Jasa Keuangan.

Article 27
(1) A Company in the form of a venture capital corporation as referred to in Article 9 paragraph (1) letter a must meet the maximum number of holders of Venture Fund Units.
(2) The maximum number of holders of Venture Fund Units as referred to in paragraph (1) is established at a maximum of 50 (fifty) parties.
(3) Provisions regarding the maximum number of holders of Venture Fund Units as referred to in paragraph (2) may be adjusted based on certain considerations.
(4) Further provisions regarding the adjustment of the maximum number of holders of Venture Fund Units as referred to in paragraph (3) are established by the Otoritas Jasa Keuangan.

Part Four
Use of Venture Fund Names

Article 28
(1) A Company in the form of a venture capital corporation as referred to in Article 9 paragraph (1) letter a must use the name of Venture Funds that describes:
a. the name of the Company; and b. a name characterizing the activities or investment objectives of the Venture Fund, in every Venture Fund formed.
(2) A Company in the form of a venture capital corporation as referred to in Article 9 paragraph (1) letter a must use Venture Fund names that:
a. are different from other Venture Fund names; and b. do not contain information that is not certainly true.

Part Five
Venture Fund Formation Agreement

Article 29
(1) A Company in the form of a venture capital corporation as referred to in Article 9 paragraph (1) letter a must form Venture Funds in an agreement made in the form of a notarial deed by a notary registered with the Otoritas Jasa Keuangan. (2) The Venture Fund formation agreement as referred to in paragraph (1) must contain at least:
a. the identity of the Company in the form of a venture capital corporation as referred to in Article 9 paragraph (1) letter a and the Custodian Bank involved in the agreement; b. the rights and obligations of the parties and the Custodian Bank;
c. the duties and responsibilities of the Company in the form of a venture capital corporation as referred to in Article 9 paragraph (1) letter a and the Custodian Bank;
d. the rights of holders of Venture Fund Units; e. investment objectives, investment policies, investment period, and investment risk overview; f. details of costs incurred; g. the submission of annual financial reports; h. the settlement of disputes/disagreements between the parties; and
i. provisions for the termination of the agreement.

Part Six
Minimum Investment Limits for Venture Funds

Article 30
(1) A Company in the form of a venture capital corporation as referred to in Article 9 paragraph (1) letter a must meet the minimum investment limit for each Venture Fund managed, at least 10% (ten percent) of the total managed funds. (2) Provisions regarding the minimum investment limit for each Venture Fund managed by a Company in the form of a venture capital corporation as referred to in Article 9 paragraph (1) letter a may be adjusted based on certain considerations. (3) Further provisions regarding the adjustment of the minimum investment limit for each Venture Fund managed by a Company in the form of a venture capital corporation as referred to in Article 9 paragraph (1) letter a as referred to in paragraph (2) are established by the Otoritas Jasa Keuangan.

Part Seven
Placement of Venture Funds

Article 31
(1) A Company in the form of a venture capital corporation as referred to in Article 9 paragraph (1) letter a is prohibited from placing Venture Funds except in the form of:
a. equity investment as referred to in Article 2 letter a for Venture Capital Companies (PMV) or as referred to in Article 3 letter a for Sharia-Compliant Venture Capital Companies (PMVS) and Sharia Venture Capital Companies (UUS); b. investment through the purchase of convertible bonds as referred to in Article 2 letter b; and/or
c. investment through the purchase of convertible sukuk as referred to in Article 3 letter b.
(2) The Company as referred to in paragraph (1) is prohibited from placing Venture Funds except to Business Partners that are not listed on the stock exchange.

Article 32
(1) The placement of Venture Funds in the form as referred to in Article 31 paragraph (1) must be conducted within a maximum period of 10 (ten) years.
(2) The time period as referred to in paragraph (1) may be extended for a maximum of 5 (five) years in accordance with the agreement of the holders of Venture Fund Units.

Article 33
A Company in the form of a venture capital corporation as referred to in Article 9 paragraph (1) letter a is prohibited from placing Venture Funds as referred to in Article 31 in derivative instruments.

Part Eight
Requirements for Holders of Venture Fund Units

Article 34
(1) A Company in the form of a venture capital corporation as referred to in Article 9 paragraph (1) letter a is prohibited from collecting funds from holders of Venture Fund Units unless they meet the following requirements:
a. Indonesian legal entities or foreign legal entities; b. individuals who meet specific requirements having net assets of at least IDR 100,000,000,000.00 (one hundred billion rupiah), excluding land and buildings;
c. central government, local government, or foreign government; and/or
d. multilateral organizations.
(2) Provisions regarding the minimum net asset limit for individuals as referred to in paragraph (1) letter b may be adjusted based on certain considerations.
(3) Further provisions regarding the adjustment of the minimum net asset limit for individuals as referred to in paragraph (2) are established by the Otoritas Jasa Keuangan.

Part Nine
Rights of Holders of Venture Fund Units and General Meeting of Holders of Venture Fund Units

Article 35
(1) The rights of holders of Venture Fund Units include at least:
a. the right to obtain proof of ownership of Venture Funds; b. the right to obtain annual financial reports periodically;
c. the right to sell back and transfer part or all of the Units;
d. the right to obtain reports on the Net Asset Value of Venture Funds; e. voting rights in the General Meeting of Holders of Venture Fund Units; f. the right to receive investment returns, if any; and g. the right to obtain a share of liquidation results. (2) The General Meeting of Holders of Venture Fund Units is conducted through the following mechanisms:
a. notification of the General Meeting of Holders of Venture Fund Units is conducted at least 14 (fourteen) days before the summons; b. the summons for the General Meeting of Holders of Venture Fund Units is conducted at least 14 (fourteen) days before the General Meeting of Holders of Venture Fund Units, at least through the Company's website or the Custodian Bank's website;
c. the Company must conduct a summons for the General Meeting of Holders of Venture Fund Units by stating the place, time, procedure, and agenda of the meeting;
d. before the notification of the planned General Meeting of Holders of Venture Fund Units is published on the website, the Company must first submit the meeting agenda clearly and in detail to the Otoritas Jasa Keuangan at least 7 (seven) days before the notification; e. the General Meeting of Holders of Venture Fund Units is declared valid if attended by holders of Venture Fund Units representing more than 1/2 (one half) of all outstanding Venture Fund Units; f. decisions in the General Meeting of Holders of Venture Fund Units are declared valid if approved by holders of Venture Fund Units representing more than 1/2 (one half) of the Venture Fund Units present; g. in the event that the first General Meeting of Holders of Venture Fund Units fails to be held or fails to make decisions, a second General Meeting of Holders of Venture Fund Units is held; h. the summons for the second General Meeting of Holders of Venture Fund Units is conducted at least 7 (seven) days before the second General Meeting of Holders of Venture Fund Units is held, stating that the first General Meeting of Holders of Venture Fund Units was held but did not reach a quorum or could not make decisions;
i. the second General Meeting of Holders of Venture Fund Units is held at least 10 (ten) days and at most 21 (twenty-one) days from the first General Meeting of Holders of Venture Fund Units;
j. the second General Meeting of Holders of Venture Fund Units is valid and entitled to make decisions if attended by holders of Venture Fund Units representing at least 1/3 (one third) of the total outstanding Venture Fund Units; k. decisions in the second General Meeting of Holders of Venture Fund Units are declared valid if approved by holders of Venture Fund Units representing more than 1/2 (one half) of the Venture Fund Units present; and
l. in the event that the second General Meeting of Holders of Venture Fund Units fails to be held or fails to make decisions, the Company may hold a third General Meeting of Holders of Venture Fund Units with quorum for attendance, quorum for decision-making, summons, and time for holding the third General Meeting of Holders of Venture Fund Units approved by the Otoritas Jasa Keuangan.

Part Ten
Dissolution of Venture Funds

Article 36
A Company in the form of a venture capital corporation as referred to in Article 9 paragraph (1) letter a must dissolve Venture Funds under the following conditions:
a. the Company in the form of a venture capital corporation as referred to in Article 9 paragraph (1) letter a and the Custodian Bank have agreed to dissolve the Venture Fund with the approval of all holders of Venture Fund Units; b. the Venture Fund fails to obtain investment from holders of Venture Fund Units according to the target and time period established in the Venture Fund formation agreement; and/or
c. based on an order from the Otoritas Jasa Keuangan.

Article 37
A Company in the form of a venture capital corporation as referred to in Article 9 paragraph (1) letter a that dissolves Venture Funds as referred to in Article 36 must:
a. submit a plan to dissolve the Venture Fund to the Otoritas Jasa Keuangan within a maximum period of 5 (five) working days from the fulfillment of the conditions as referred to in Article 36, attaching:

proof of dissolution approval from all holders of Venture Fund Units for Venture Funds dissolved due to conditions as referred to in Article 36 letter a; and
the latest financial report of the Venture Fund;
b. notify in writing to the Custodian Bank to stop the calculation of the Net Asset Value of the Venture Fund;
c. submit a report on the results of the dissolution of the Venture Fund to the Otoritas Jasa Keuangan within a maximum period of 20 (twenty) working days since dissolution, attaching:
the dissolution deed from a notary registered with the Otoritas Jasa Keuangan;
proof of the settlement of the rights and obligations of the Venture Fund; and
the latest financial report of the Venture Fund audited by a public accountant registered with the Otoritas Jasa Keuangan.

Part Eleven
Obligations, Prohibitions, and Duties of Companies in the Form of Venture Capital Corporations and Custodian Banks

Article 38
(1) In managing Venture Funds, a Company in the form of a venture capital corporation as referred to in Article 9 paragraph (1) letter a must:
a. have good faith and full responsibility in managing Venture Funds as best as possible for the benefit of holders of Venture Fund Units; b. store and maintain all accounting books and important records related to financial reports and the management of Venture Funds;
c. separate the accounting books and important records as referred to in letter b from the accounting books and records of the Company in the form of a venture capital corporation as referred to in Article 9 paragraph (1) letter a;
d. provide information to holders of Venture Fund Units or potential holders of Venture Fund Units regarding the investment risk overview clearly; e. determine the fair market value of the investment in Business Partners and submit it to the Custodian Bank every 1 (one) month; f. determine the calculation method for the fair market value of the investment in Business Partners consistently to calculate and determine the Net Asset Value; and g. implement anti-money laundering, counter-terrorism financing, and counter-proliferation financing of weapons of mass destruction programs. (2) In managing Venture Funds, a Company in the form of a venture capital corporation as referred to in Article 9 paragraph (1) letter a is prohibited from:
a. having an affiliation with the Custodian Bank, except for affiliations arising from government ownership or equity investment; and

b. having an investment portfolio in Affiliated Business Entities with the Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a of more than 20% (twenty percent) of the Net Asset Value of the Venture Fund, except for affiliation relationships arising from government ownership or capital investment.

Article 39
(1) Custodian Banks have the duties:
a. providing collective depositary and custodian services regarding Venture Fund assets; b. calculating the Net Asset Value of the Venture Fund every 1 (one) month;
c. paying costs related to the Venture Fund upon the order of the Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a that manages the Venture Fund;
d. storing and maintaining separate records showing all changes in data of Venture Fund Unit Holders; and e. representing Venture Fund Unit Holders collectively for the investment placement of the Venture Fund. (2) The Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a is prohibited from having an affiliation with the Custodian Bank managing the Venture Fund, except for affiliation relationships arising from government ownership or capital investment.

Twelfth Section
Trustees

Article 40
(1) In conducting monitoring of investments in convertible bonds, debt instruments, convertible sukuk, and/or sukuk, the Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a may appoint a Trustee registered with the Financial Services Authority to represent the interests of the Venture Fund as the holder of convertible bonds and/or debt instruments to supervise the implementation of the issuance agreement for convertible bonds, debt instruments, convertible sukuk, sukuk, and/or debt instruments by the Business Entity. (2) The Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a that manages the Venture Fund is prohibited from having an affiliation relationship with the Trustee, except for affiliation relationships arising from government ownership or capital investment. (3) The Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a must ensure that the Trustee as referred to in paragraph (1) does not have a debt relationship with the Business Entity in an amount exceeding 25% (twenty-five percent) of the value of the convertible bonds and/or debt instruments of the Business Entity.

Thirteenth Section
Application of Prudential Principles
Paragraph 1
Scope of Application of Prudential Principles

Article 41
(1) The Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a must apply prudential principles in conducting business activities.
(2) The prudential principles as referred to in paragraph (1) include:
a. maintaining the gearing ratio, quality of productive assets, adequacy of provisions for impairment of productive assets, and provisions in accordance with financial accounting standards; b. applying the Maximum Financing Limit (BMPP) for the Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a that disburses financing as referred to in Article 9 paragraph (2) letter a or financing based on profit-sharing principles as referred to in Article 9 paragraph (2) letter b; and
c. maintaining minimum capital adequacy through meeting the equity ratio to paid-up capital ratio of at least 30% (thirty percent).
(3) The Financial Services Authority is authorized to order the Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a to implement prudential principles other than those referred to in paragraph (2). (4) The Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a must implement the orders of the Financial Services Authority as referred to in paragraph (3).

Paragraph 2
Gearing Ratio

Article 42
(1) The Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a must meet the gearing ratio requirements of a minimum of 0 (zero) and a maximum of 10 (ten) times.
(2) The gearing ratio as referred to in paragraph (1) is the ratio between the total amount of loans/funding and the sum of Equity and subordinated loans/funding.
(3) Subordinated loans/funding that can be counted in the calculation of the gearing ratio as referred to in paragraph (2) are at most 50% (fifty percent) of Paid-up Capital.

Paragraph 3
Quality of Productive Assets

Article 43
(1) The Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a must conduct an assessment of the quality of productive assets.
(2) The assessment of the quality of productive assets as referred to in paragraph (1) is determined based on the business activities conducted.
(3) The assessment of the quality of productive assets as referred to in paragraph (2) for activities:
a. capital investment, is determined based on factors:

business prospects of the Business Entity; and
financial condition of the Business Entity;
b. investment through the purchase of convertible bonds, investment through the purchase of convertible sukuk, financing through the purchase of debt instruments issued by the Business Entity at the initial startup stage and/or business development stage, and the purchase of sukuk issued by the Business Entity at the initial startup stage and/or business development stage, is determined based on amortized acquisition cost; and
c. financing and/or financing based on profit-sharing principles, is determined based on the value of financing.
(4) The Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a must have internal guidelines regarding the determination of the basis for assessing the quality of productive assets to conduct the assessment of the quality of productive assets as referred to in paragraph (3). (5) The Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a must consistently implement the internal guidelines regarding the determination of the basis for assessing the quality of productive assets as referred to in paragraph (3). (6) The assessment of the quality of productive assets as referred to in paragraph (3) consists of:
a. good; b. special attention;
c. doubtful;
d. questionable; or e. non-performing.
(7) Productive assets categorized as problematic consist of productive assets categorized as doubtful, questionable, and non-performing.
(8) The quality of financing receivables as referred to in paragraph (3) letter c that is categorized as problematic financing consists of financing receivables with doubtful, questionable, and non-performing quality. (9) The Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a is prohibited from having financing receivables with the category of problematic financing quality as referred to in paragraph (8) after being reduced by provisions for impairment of financing receivables with doubtful, questionable, and non-performing quality compared to the total balance of financing receivables, exceeding 5% (five percent) of total financing.

Paragraph 4
Provisions for Impairment of Productive Assets and Provisions in Accordance with Financial Accounting Standards

Article 44
(1) The Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a must calculate the provisions for impairment of productive assets.
(2) The calculation of provisions for impairment of productive assets as referred to in paragraph (1) is determined at a minimum:
a. 0.5% (zero point five percent) of the balance value of each productive asset with good quality after being reduced by collateral; b. 5% (five percent) of the balance value of each productive asset with special attention quality after being reduced by collateral;
c. 10% (ten percent) of the balance value of each productive asset with doubtful quality after being reduced by collateral;
d. 50% (fifty percent) of the balance value of each productive asset with questionable quality after being reduced by collateral; and e. 100% (one hundred percent) of the balance value of each productive asset with non-performing quality after being reduced by collateral. (3) The calculation of provisions for impairment of productive assets for Business Entities in priority economic sectors is exempt from the provisions as referred to in paragraph (2) and is determined at a minimum:
a. 0.25% (zero point two five percent) of the balance value of each productive asset with good quality after being reduced by collateral; b. 2.5% (two point five percent) of the balance value of each productive asset with special attention quality after being reduced by collateral;
c. 5% (five percent) of the balance value of each productive asset with doubtful quality after being reduced by collateral;
d. 25% (twenty-five percent) of the balance value of each productive asset with questionable quality after being reduced by collateral; and e. 50% (fifty percent) of the balance value of each productive asset with non-performing quality after being reduced by collateral. (4) Priority economic sectors as referred to in paragraph (3) include economic sectors:
a. creative economy; b. food security;
c. provision of simple houses and/or simple apartments;
d. new and renewable energy; e. environmentally conscious tourism; f. water management; g. electricity; h. infrastructure supporting land, sea, and air transportation in the form of road, bridge, railway, port, and airport construction; and
i. goods and/or services for financing the maritime sector.
(5) The Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a must:
a. form provisions for impairment of productive assets at a minimum in accordance with the provisions as referred to in paragraph (2) or paragraph (3), in monthly reports submitted to the Financial Services Authority; and b. form provisions in accordance with financial accounting standards in annual financial reports that have been audited by a public accountant registered with the Financial Services Authority. (6) The value of collateral as referred to in paragraph (2) or paragraph (3) that can be counted as a reduction of the financing balance is set at most equal to the balance of financing receivables.

Paragraph 5
Maximum Financing Limit (BMPP)

Article 45
(1) The Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a that disburses financing as referred to in Article 9 paragraph (2) letter a or financing based on profit-sharing principles as referred to in Article 9 paragraph (2) letter b must:
a. meet the BMPP requirements to Borrowers/Customers who are related parties at a maximum of 10% (ten percent) of the Equity of the Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a that disburses financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b; b. meet the BMPP requirements to 1 (one) Borrower/Customer who is not a related party at a maximum of 20% (twenty percent) of the Equity of the Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a that disburses financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b; and
c. meet the BMPP requirements to 1 (one) group of Borrowers/Customers who are not related parties at a maximum of 25% (twenty-five percent) of the Equity of the Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a that disburses financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b.
(2) The basis for calculating Equity in calculating BMPP as referred to in paragraph (1) is the Equity in the latest monthly report of the Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a that disburses financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b. (3) In the event that the Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a that disburses financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b obtains a business license for less than 1 (one) month, the basis for calculating Equity in calculating BMPP as referred to in paragraph (1) letters a and b is the Equity in the financial report submitted at the time of the business license application. (4) Borrowers/Customers are classified as members of a group of Borrowers/Customers as referred to in paragraph (3) if the Borrower/Customer has a control relationship with another Borrower/Customer, whether through ownership, management, and/or financial relationships, which includes:
a. the Borrower/Customer is the controller of another Borrower/Customer; b. one (one) same party is the controller of several Borrowers/Customers;
c. the Borrower/Customer has financial dependence on another Borrower/Customer;
d. the Borrower/Customer issues a guarantee to take over and/or pay off part or all of the obligations of another Borrower/Customer in the event that the other Borrower/Customer defaults on the Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a that disburses financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b; and/or e. the board of commissioners and/or board of directors of the Borrower/Customer becomes the board of commissioners and/or board of directors of another Borrower/Customer. (5) The BMPP provisions as referred to in paragraph (1) are exempted for the disbursement of financing and/or financing based on profit-sharing principles under government assignment in the implementation of government programs. (6) Government assignment as referred to in paragraph (5) must be based on legislation or a decision established by the government.

Article 46
(1) The Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a that disburses financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b that does not meet the provisions as referred to in Article 45 paragraph (1) may be categorized as exceeding the BMPP if caused by:
a. a decrease in Equity; b. exchange rate changes;
c. fair value changes;
d. business mergers and/or changes in management structure that cause changes in related parties as referred to in Article 17 paragraph (8) and/or groups of Borrowers/Customers; and/or e. changes in legislation. (2) The BMPP excess as referred to in paragraph (1) is calculated based on the recorded value on the report date. (3) The Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a that disburses financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b that does not meet the provisions as referred to in Article 45 paragraph (1) must submit a fulfillment plan at the latest 1 (one) month since the BMPP excess was established by the Financial Services Authority.

Article 47
(1) The target time for completing the BMPP excess as referred to in Article 46 paragraph (1) is determined:
a. for BMPP excess caused by a decrease in Equity as referred to in Article 46 paragraph (1) letter a, exchange rate changes as referred to in Article 46 paragraph (1) letter b, and fair value changes as referred to in Article 46 paragraph (1) letter c, at a maximum of 9 (nine) months; b. for BMPP excess caused by business mergers and/or changes in management structure that cause changes in related parties as referred to in Article 17 paragraph (8) and/or groups of Borrowers/Customers as referred to in Article 46 paragraph (1) letter d, at a maximum of 12 (twelve) months; and/or
c. for BMPP excess caused by changes in legislation as referred to in Article 46 paragraph (1) letter e, at a maximum of 18 (eighteen) months,
since the deadline for submitting the fulfillment plan to the Financial Services Authority.
(2) In the event that the target time for completing the BMPP excess as referred to in paragraph (1) is assessed as unachievable, the Financial Services Authority is authorized to establish a new target time for completing the BMPP excess for the Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a that disburses financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b that does not meet the provisions as referred to in Article 45 paragraph (1).

Article 48
(1) The Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a is prohibited from making agreements or setting requirements that obligate the Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a to provide financing that results in a violation of the BMPP. (2) The Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a that:
a. conducts capital investment, investment through the purchase of convertible bonds, investment through the purchase of convertible sukuk, and/or other activities with the approval of the Financial Services Authority as referred to in Article 17 paragraph (2); and b. disburses financing as referred to in Article 45 paragraph (1), to the same Business Entity or Borrower/Customer, must meet the accumulation requirements for the value of investment, financing, and other activities. (3) The provisions for the accumulation of the value of investment, financing, and other activities as referred to in paragraph (2) apply:
a. at a maximum of 10% (ten percent) of the Equity of the Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a to the same Business Entity or Borrower/Customer who is a related party; b. at a maximum of 20% (twenty percent) of the Equity of the Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a to the same Business Entity or Borrower/Customer who is not a related party; and
c. at a maximum of 25% (twenty-five percent) of the Equity of the Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a to 1 (one) group of Business Entities or Borrowers/Customers.

Fourteenth Section
Maintenance and Return of Collateral Ownership Documents

Article 49
(1) In the event that the Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a that disburses financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b requires and accepts collateral from Borrowers/Customers, the Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a that disburses financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b must store and maintain documents proving ownership of the collateral at the head office and/or branch offices of the Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a that disburses financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b until the financing agreement ends. (2) The Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a that disburses financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b must have written guidelines and a storage place that meets security standards in conducting the storage and maintenance of collateral ownership documents. (3) In the event that the Financial Services Authority assesses that the Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a that disburses financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b does not have a storage place for collateral ownership documents that meets security standards, the collateral ownership documents must be deposited at a deposit facility.

Article 50
(1) The Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a that conducts financing disbursement through refinancing and/or joint financing must ensure that the storage and maintenance of collateral ownership documents are conducted by:
a. the fund owner; b. the deposit facility; and/or
c. the Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a with the approval of the fund owner, if the financing disbursement scheme used is refinancing.
(2) The Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a that disburses financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b that conducts storage of collateral ownership documents based on the approval of the fund owner as referred to in paragraph (1) letter c must have written guidelines and a storage place that meets security standards in conducting the storage and maintenance of collateral ownership documents. (3) In the event that the Financial Services Authority assesses that the Venture Capital Corporation as referred to in Article 9 paragraph (1) letter a that disburses financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b does not have a storage place for collateral ownership documents that meets security standards

as referred to in paragraph (2), proof of ownership of collateral must be deposited at a deposit facility.

Article 51
Venture capital corporations as referred to in Article 9 paragraph (1) letter a that disburse financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b are prohibited from mortgaging physical proof of ownership of collateral to third parties.

Article 52
Venture capital corporations as referred to in Article 9 paragraph (1) letter a that disburse financing as referred to in Article 9 paragraph (2) letter a or financing based on profit-sharing principles as referred to in Article 9 paragraph (2) letter b must:
a. notify the Debtor/Customer regarding the return of proof of ownership of collateral; and b. return proof of ownership of collateral, at the latest 1 (one) month from the date of settlement of financing receivables.

Fifteenth Section
Debt Collection

Article 53
(1) In the event that the Debtor/Customer defaults, venture capital corporations as referred to in Article 9 paragraph (1) letter a that disburse financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b must conduct debt collection, at minimum by issuing a warning letter in accordance with the time period in the financing agreement. (2) The warning letter as referred to in paragraph (1) must contain at least the following information:
a. the number of days of payment delay; b. the outstanding principal balance;
c. the accrued interest; and
d. the accrued penalty, if any.

Article 54
(1) Venture capital corporations as referred to in Article 9 paragraph (1) letter a that disburse financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b may cooperate with third parties to perform debt collection functions for the Debtor/Customer.

(2) Venture capital corporations as referred to in Article 9 paragraph (1) letter a that disburse financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b must formalize cooperation with third parties as referred to in paragraph (1) in the form of a written agreement bearing a stamp duty. (3) Cooperation with third parties as referred to in paragraph (1) must meet the following requirements:
a. the third party is a legal entity; b. the third party holds a license from the competent authority, if required by applicable laws and regulations; and
c. the third party has human resources that have obtained certification in the field of debt collection from a professional certification body in the financing sector.
(4) Venture capital corporations as referred to in Article 9 paragraph (1) letter a that disburse financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b must take full responsibility for all impacts arising from cooperation with third parties as referred to in paragraph (1), provided that the third party acts in accordance with the cooperation agreement. (5) Venture capital corporations as referred to in Article 9 paragraph (1) letter a that disburse financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b must conduct periodic evaluations of cooperation with third parties as referred to in paragraph (1), at least once every 1 (one) year.

Article 55
(1) Venture capital corporations as referred to in Article 9 paragraph (1) letter a that disburse financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b must have internal guidelines regarding collateral execution. (2) The Financial Services Authority (OJK) is authorized to order venture capital corporations as referred to in Article 9 paragraph (1) letter a that disburse financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b to adjust their internal guidelines regarding collateral execution. (3) Venture capital corporations as referred to in Article 9 paragraph (1) letter a that disburse financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b must adjust their internal guidelines regarding collateral execution based on the order of the Financial Services Authority (OJK) as referred to in paragraph (2).

Article 56
(1) Collateral execution by venture capital corporations as referred to in Article 9 paragraph (1) letter a that disburse financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b must meet the following requirements:
a. the Debtor/Customer is proven to have defaulted based on criteria as referred to in the financing agreement agreed upon by the parties; b. the Debtor/Customer has been issued a warning letter; and
c. the venture capital corporation as referred to in Article 9 paragraph (1) letter a that disburse financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b holds a certificate of real right guarantee over the collateral object.
(2) Collateral execution as referred to in paragraph (1) must be carried out in accordance with applicable laws and regulations governing each type of collateral.
(3) Collateral execution as referred to in paragraph (1) must be documented in a collateral execution report.
(4) In the event of collateral execution, venture capital corporations as referred to in Article 9 paragraph (1) letter a must explain to the Debtor/Customer information regarding:
a. the outstanding principal balance; b. the accrued interest or return;
c. the accrued penalty, if any;
d. costs related to collateral execution; and e. the mechanism for selling the collateral in the event that the Debtor/Customer does not settle the obligation.

Article 57
(1) In the event that after collateral execution is carried out and the Debtor/Customer cannot settle the obligation within a certain period, venture capital corporations as referred to in Article 9 paragraph (1) letter a that disburse financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b may only conduct:
a. the sale of collateral through public auction and take settlement of their receivables from the sale proceeds; and/or b. the sale of collateral privately based on price agreement between the venture capital corporation as referred to in Article 9 paragraph (1) letter a and the Debtor/Customer before the collateral is sold and take settlement of their receivables from the sale proceeds. (2) The implementation of the sale of collateral as referred to in paragraph (1) is conducted in accordance with applicable laws and regulations regarding the implementation of the sale of collateral.

Article 58
(1) Venture capital corporations as referred to in Article 9 paragraph (1) letter a that disburse financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b must return excess funds from the proceeds of the sale of collateral through public auction as referred to in Article 57 paragraph (1) letter a or the sale of collateral privately as referred to in Article 57 paragraph (1) letter b to the Debtor/Customer within the time period in accordance with the financing agreement. (2) If the proceeds from the sale of collateral through public auction as referred to in paragraph (1) are insufficient to settle the debt, the Debtor/Customer remains responsible for the unpaid debt.

Sixteenth Section
Transparency of Business Activities

Article 59
Venture capital corporations as referred to in Article 9 paragraph (1) letter a that disburse financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b must submit a copy of the financing agreement to the Debtor/Customer at the latest 3 (three) months from the date of the financing agreement.

Article 60
Venture capital corporations as referred to in Article 9 paragraph (1) letter a that disburse financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b must inform the Debtor/Customer to read and understand the contents of the contract regulated in the financing agreement.

Article 61
Venture capital corporations as referred to in Article 9 paragraph (1) letter a that disburse financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b must clearly state information regarding the financing interest rate on:
a. every office of the venture capital corporation as referred to in Article 9 paragraph (1) letter a that disburse financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b; and/or b. the website of the venture capital corporation as referred to in Article 9 paragraph (1) letter a that disburse financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b.

Article 62
(1) Venture capital corporations as referred to in Article 9 paragraph (1) letter a that disburse financing as referred to in Article 9 paragraph (2) letter a or financing as referred to in Article 9 paragraph (2) letter b must explain illustrations of:
a. the calculation of financing principal receivables and interest or return over the financing period; and b. the imposition of penalties and collateral execution costs, if any, to the Debtor/Customer before the signing of the financing agreement. (2) The explanation of illustrations to the Debtor/Customer as referred to in paragraph (1) must be documented in a document signed by the Debtor/Customer.

Seventeenth Section
Compliance Enforcement
Paragraph 1
Compliance Fulfillment Plan

Article 63
(1) Venture capital corporations as referred to in Article 9 paragraph (1) letter a and Sharia Business Units (UUS) that violate provisions as referred to in Article 17 paragraph (1), paragraph (2), Article 42 paragraph (1), Article 43 paragraph (9) and/or Article 45 paragraph (1), will be issued a letter requesting a compliance fulfillment plan by the Financial Services Authority (OJK). (2) Venture capital corporations as referred to in Article 9 paragraph (1) letter a and UUS must submit a compliance fulfillment plan at the latest 1 (one) month from the date of the letter requesting a compliance fulfillment plan by the Financial Services Authority (OJK) as referred to in paragraph (1). (3) The compliance fulfillment plan as referred to in paragraph (2) must contain at least the plan to be carried out by the venture capital corporation as referred to in Article 9 paragraph (1) letter a and UUS, accompanied by a specific time period required to fulfill the provisions as referred to in paragraph (2). (4) The compliance fulfillment plan as referred to in paragraph (3) contains:
a. merger, consolidation, or takeover of business entities; b. increase in Paid-up Capital;
c. acceptance of subordinated funding;
d. restriction of activities causing violations of provisions; e. asset restructuring; and/or f. other actions.
(5) The compliance fulfillment plan as referred to in paragraph (2) must be signed by all members of the Board of Directors and members of the Board of Commissioners.
(6) The compliance fulfillment plan as referred to in paragraph (2) must first be approved by the General Meeting of Shareholders (GMS) in the event that the plan contains a plan to increase Paid-up Capital or a plan for merger, consolidation, or takeover of business entities. (7) The compliance fulfillment plan as referred to in paragraph (2) must obtain a statement of no objection from the Financial Services Authority (OJK). (8) The Financial Services Authority (OJK) submits a request for improvement, rejection, or statement of no objection regarding the compliance fulfillment plan submitted by the venture capital corporation as referred to in Article 9 paragraph (1) letter a as referred to in paragraph (2) within a time period of at most 14 (fourteen) working days from the date the compliance fulfillment plan is received. (9) The Financial Services Authority (OJK) submits a letter requesting improvement of the compliance fulfillment plan in the event that the compliance fulfillment plan, based on the assessment of the Financial Services Authority (OJK), still requires improvement. (10) Venture capital corporations as referred to in Article 9 paragraph (1) letter a and UUS must submit the improved compliance fulfillment plan in accordance with the request of the Financial Services Authority (OJK) as referred to in paragraph (9) at the latest 14 (fourteen) working days from the date of the letter requesting improvement of the compliance fulfillment plan from the Financial Services Authority (OJK) as referred to in paragraph (8). (11) In the event that the venture capital corporation as referred to in Article 9 paragraph (1) letter a and UUS have submitted the improved compliance fulfillment plan in accordance with the request of the Financial Services Authority (OJK), the Financial Services Authority (OJK) provides a statement of no objection or rejection in accordance with the provisions as referred to in paragraph (8). (12) The Financial Services Authority (OJK) provides a statement of no objection regarding the compliance fulfillment plan in the event that the compliance fulfillment plan is assessed to be able to resolve the provision issues that have not yet been fulfilled by the venture capital corporation as referred to in Article 9 paragraph (1) letter a and UUS. (13) The Financial Services Authority (OJK) submits a rejection regarding the compliance fulfillment plan in the event that the compliance fulfillment plan is assessed to be unable to resolve the provision issues that have not yet been fulfilled by the venture capital corporation as referred to in Article 9 paragraph (1) letter a and UUS. (14) If within the time period as referred to in paragraph (8) the Financial Services Authority (OJK) does not submit a request for improvement, rejection, or statement of no objection, the venture capital corporation as referred to in Article 9 paragraph (1) letter a and UUS may implement the compliance fulfillment plan. (15) Venture capital
corporations as referred to in Article 9 paragraph (1) letter a and UUS must implement the compliance fulfillment plan that has obtained a statement of no objection from the Financial Services Authority (OJK) as referred to in paragraph (12) or the compliance fulfillment plan as referred to in paragraph (14). (16) The time period for the compliance fulfillment plan consisting of actions as referred to in paragraph (4) letter a and letter b is limited to at most 2 (two) years. (17) The time period for the compliance fulfillment plan consisting of actions as referred to in paragraph (4) letter c through letter f is limited to at most 1 (one) year.

Paragraph 2
Administrative Sanctions

Article 64
(1) Venture capital corporations as referred to in Article 9 paragraph (1) letter a and UUS that:
a. violate provisions as referred to in Article 63 paragraph (2), paragraph (10), and paragraph (15); b. have their fulfillment plan rejected as referred to in Article 63 paragraph (13); and/or
c. have not fulfilled provisions as referred to in Article 17 paragraph (3), paragraph (4), paragraph (5), paragraph (6), Article 19, Article 25 paragraph (2), Article 26 paragraph (1), Article 27 paragraph (1), Article 28 paragraph (1), Article 29, Article 30 paragraph (1), Article 31, Article 32 paragraph (1), Article 33, Article 34 paragraph (1), Article 36, Article 37, Article 38, Article 39 paragraph (2), Article 40 paragraph (2), paragraph (3), Article 41 paragraph (1), paragraph (4), Article 43 paragraph (1), paragraph (4), paragraph (5), paragraph (9), Article 44 paragraph (1), paragraph (5), Article 46 paragraph (3), Article 48 paragraph (1), paragraph (2), Article 49, Article 50, Article 51, Article 52, Article 53, Article 54 paragraph (2), paragraph (3), paragraph (4), paragraph (5), Article 55 paragraph (1), paragraph (3), Article 56, Article 58 paragraph (1), Article 59, Article 60, Article 61, and/or Article 62,
are subject to graduated administrative sanctions.
(2) Administrative sanctions as referred to in paragraph (1) consist of:
a. written warning; b. suspension of part or all business activities; and
c. revocation of the business license of the venture capital corporation as referred to in Article 9 paragraph (1) letter a or revocation of the UUS license.
(3) In addition to administrative sanctions as referred to in paragraph (2), the Financial Services Authority (OJK) is authorized to:
a. downgrade the health assessment result; and/or b. conduct a re-evaluation of the competence and propriety of the principal parties of the venture capital corporation as referred to in Article 9 paragraph (1) letter a. (4) Administrative sanctions in the form of written warnings as referred to in paragraph (2) letter a are given in writing at most 3 (three) times consecutively with a time period of at most 2 (two) months each. (5) In the event that before the end of the time period for administrative sanctions in the form of written warnings as referred to in paragraph (4), the venture capital corporation as referred to in Article 9 paragraph (1) letter a and UUS have fulfilled the provisions as referred to in paragraph (1), the Financial Services Authority (OJK) revokes the administrative sanction in the form of written warning. (6) In the event that a violation of provisions as referred to in paragraph (1) occurs but the violation has been corrected, the Financial Services Authority (OJK) provides a written warning sanction that ends automatically. (7) In the event that the time period for the third written warning as referred to in paragraph (4) ends and the venture capital corporation as referred to in Article 9 paragraph (1) letter a and UUS still do not fulfill the provisions as referred to in paragraph (1), the Financial Services Authority (OJK) imposes administrative sanctions in the form of suspension of part or all business activities. (8) Administrative sanctions in the form of suspension of part or all business activities as referred to in paragraph (2) letter a are given in writing and take effect from the date of establishment for a time period of at most 6 (six) months. (9) In the event that the venture capital corporation as referred to in Article 9 paragraph (1) letter a and UUS are subject to administrative sanctions in the form of suspension of part or all business activities as referred to in paragraph (7), the venture capital corporation as referred to in Article 9 paragraph (1) letter a and UUS are prohibited from conducting business activities. (10) In the event that before the end of the time period for suspension of part or all business activities as referred to in paragraph (8), the venture capital corporation as referred to in Article 9 paragraph (1) letter a and UUS have fulfilled the provisions as referred to in paragraph (1), the Financial Services Authority (OJK) revokes the administrative sanction in the form of suspension of part or all business activities. (11) In the event that administrative sanctions in the form of suspension of part or all business activities are still in effect and the venture capital corporation as referred to in Article 9 paragraph (1) letter a and UUS continue to conduct business activities, the Financial Services Authority (OJK) is authorized to directly impose administrative sanctions in the form of revocation of the business license of the venture capital corporation as referred to
in Article 9 paragraph (1) letter a or revocation of the UUS license. (12) If the time period for administrative sanctions in the form of written warnings and/or suspension of part or all business activities ends on a holiday, the administrative sanctions in the form of written warnings and/or suspension of business activities remain in effect until the first working day following. (13) In the event that by the end of the time period for suspension of part or all business activities as referred to in paragraph (8), the venture capital corporation as referred to in Article 9 paragraph (1) letter a and UUS still have not fulfilled the provisions as referred to in paragraph (1), the Financial Services Authority (OJK) revokes the business license of the venture capital corporation as referred to in Article 9 paragraph (1) letter a or the UUS license in question. (14) The Financial Services Authority (OJK) announces administrative sanctions in the form of suspension of part or all business activities as referred to in paragraph (2) letter b and/or revocation of the business license of the venture capital corporation as referred to in Article 9 paragraph (1) letter a or revocation of the UUS license as referred to in paragraph (2) letter c to the public.

CHAPTER IV
VENTURE DEBT CORPORATION COMPANIES
First Section
General Provisions

Article 65
Venture debt corporations as referred to in Article 9 paragraph (1) letter b are prohibited from conducting financing disbursement activities except to:
a. micro, small, or medium business actors; and/or b. Business Partners in the early stages of business and/or business development.

Article 66
(1) Micro, small, or medium business actors as referred to in Article 65 letter a are grouped based on business capital criteria or annual sales results.
(2) Business capital criteria as referred to in paragraph (1):
a. Micro businesses have business capital of up to Rp1,000,000,000.00 (one billion rupiah) excluding land and business premises buildings; b. Small businesses have business capital of more than Rp1,000,000,000.00 (one billion rupiah) up to a maximum of Rp5,000,000,000.00 (five billion rupiah) excluding land and business premises buildings; and
c. Medium businesses have business capital of more than Rp5,000,000,000.00 (five billion rupiah) up to a maximum of Rp10,000,000,000.00 (ten billion rupiah) excluding land and business premises buildings.
(3) Annual sales results criteria as referred to in paragraph (1):
a. Micro businesses have annual sales results of up to a maximum of Rp2,000,000,000.00 (two billion rupiah); b. Small businesses have annual sales results of more than Rp2,000,000,000.00 (two billion rupiah) up to a maximum of Rp15,000,000,000.00 (fifteen billion rupiah); and
c. Medium businesses have annual sales results of more than Rp15,000,000,000.00 (fifteen billion rupiah) up to a maximum of Rp50,000,000,000.00 (fifty billion rupiah).

Part Two

Financing Cooperation

Article 67
(1) A venture debt corporation as referred to in Article 9 paragraph (1) letter b may conduct financing cooperation with other parties in the form of:
a. subordinated financing; or b. joint financing.

(2) Other parties as referred to in paragraph (1):
a. Other companies; b. microfinance institutions;
c. financing companies;
d. banks; and/or e. other financial institutions permitted by applicable laws and regulations to conduct cooperation through subordinated and/or joint financing schemes.

(3) A venture debt corporation as referred to in Article 9 paragraph (1) letter b is prohibited from conducting cooperation with other parties as referred to in paragraph (2) other than those regulated and supervised by the Financial Services Authority.

(4) A venture debt corporation as referred to in Article 9 paragraph (1) letter b that conducts business activities based on Sharia Principles must conduct subordinated financing as referred to in paragraph (1) letter a using a wakalah bil ujrah contract.

Article 68
(1) A venture debt corporation as referred to in Article 9 paragraph (1) letter b is prohibited from conducting subordinated financing unless the risks arising from the subordinated financing activity become the responsibility of the fund owners.

(2) In subordinated financing as referred to in paragraph (1), the fund recipient acts only as a manager and receives remuneration for the management of such funds.

(3) A venture debt corporation as referred to in Article 9 paragraph (1) letter b must include the imposition of risks as referred to in paragraph (1) in a written agreement between the venture debt corporation as referred to in Article 9 paragraph (1) letter b and the fund owners.

Article 69
(1) A venture debt corporation as referred to in Article 9 paragraph (1) letter b is prohibited from conducting joint financing unless the source of financing funds comes from a venture debt corporation as referred to in Article 9 paragraph (1) letter b and other parties as referred to in Article 67 paragraph (2).

(2) Risks arising from joint financing as referred to in paragraph (1) become the burden of each party proportionally according to the amount of funds disbursed.

(3) A venture debt corporation as referred to in Article 9 paragraph (1) letter b must include the risk distribution as referred to in paragraph (2) in a written agreement between the venture debt corporation as referred to in Article 9 paragraph (1) letter b and other parties.

Article 70
Cooperation by a venture debt corporation as referred to in Article 9 paragraph (1) letter b with other parties through subordinated and/or joint financing as referred to in Article 67 paragraph (1) must be conducted in accordance with applicable laws and regulations.

Part Three

Application of Prudential Principles

Paragraph 1

Scope of Application of Prudential Principles

Article 71
(1) A venture debt corporation as referred to in Article 9 paragraph (1) letter b must apply prudential principles in conducting business activities.

(2) Prudential principles as referred to in paragraph (1) include:
a. maintaining gearing ratio, financing receivables quality, and adequacy of provisions for write-off of productive assets, and provisions in accordance with financial accounting standards; b. applying Maximum Financing Limits (BMPP); and
c. maintaining minimum capital adequacy through compliance with the equity ratio to paid-up capital of at least 30% (thirty percent).

(3) The Financial Services Authority is authorized to order a venture debt corporation as referred to in Article 9 paragraph (1) letter b to implement prudential principles other than those referred to in paragraph (2).

(4) A venture debt corporation as referred to in Article 9 paragraph (1) letter b must implement the orders of the Financial Services Authority as referred to in paragraph (3).

Paragraph 2

Gearing Ratio

Article 72
(1) A venture debt corporation as referred to in Article 9 paragraph (1) letter b must meet the gearing ratio requirements of at least 0 (zero) and at most 15 (fifteen) times.

(2) Gearing ratio as referred to in paragraph (1) is the ratio between the total amount of loans/funding and the sum of Equity and subordinated loans/funding.

(3) Subordinated loans/funding that can be counted in the calculation of gearing ratio as referred to in paragraph (2) are at most 50% (fifty percent) of Paid-up Capital.

Paragraph 3

Quality of Financing Receivables

Article 73
(1) A venture debt corporation as referred to in Article 9 paragraph (1) letter b must assess the quality of financing receivables.

(2) The assessment of financing receivables quality consists of:
a. performing; b. special attention;
c. substandard;
d. doubtful; or e. non-performing.

(3) Financing receivables quality as referred to in paragraph (2) is categorized:
a. for financing through the purchase of debt securities issued by Business Partners at the initial exploration and/or business development stage, and/or the purchase of sukuk issued by Business Partners at the initial exploration and/or business development stage:

performing, if:
a) included in the investment-grade category by a rating agency recognized by the Financial Services Authority; b) coupons or other similar obligations are paid in the correct amount and time, in accordance with the agreement; and c) not yet due;
substandard, if:
a) included in the investment-grade category by a rating agency recognized by the Financial Services Authority; b) there is a delay in coupon or other similar obligation payments; and c) not yet due; OR a) has a rating at least 1 (one) level below the investment-grade category; b) there is no delay in coupon or other similar obligation payments; and c) not yet due;
non-performing, if the securities do not meet the criteria as referred to in numbers 1 and 2; and
b. for financing activities and/or financing based on Sharia profit-sharing principles:
performing if there is no delay or there is a delay in principal payment of up to 30 (thirty) calendar days;
special attention if there is a delay in principal payment that has exceeded 30 (thirty) calendar days up to 90 (ninety) calendar days;
substandard if there is a delay in principal payment that has exceeded 90 (ninety) calendar days up to 120 (one hundred twenty) calendar days;
doubtful if there is a delay in principal payment that has exceeded 120 (one hundred twenty) calendar days up to 180 (one hundred eighty) calendar days; and
non-performing if there is a delay in principal payment that has exceeded 180 (one hundred eighty) calendar days.

(4) Productive asset quality for financing through the purchase of debt securities issued by Business Partners at the initial exploration and/or business development stage, and/or the purchase of sukuk issued by Business Partners at the initial exploration and/or business development stage:

performing, if:
a) included in the investment-grade category by a rating agency recognized by the Financial Services Authority; b) coupons or other similar obligations are paid in the correct amount and time, in accordance with the agreement; and c) not yet due;
substandard, if:
a) included in the investment-grade category by a rating agency recognized by the Financial Services Authority; b) there is a delay in coupon or other similar obligation payments; and c) not yet due; OR a) has a rating at least 1 (one) level below the investment-grade category; b) there is no delay in coupon or other similar obligation payments; and c) not yet due;
non-performing, if the securities do not meet the criteria as referred to in numbers 1 and 2.

(5) Financing receivables categorized as problematic financing consist of financing receivables with substandard, doubtful, and non-performing quality.

(6) A venture debt corporation as referred to in Article 9 paragraph (1) letter b is prohibited from having financing receivables with problematic financing quality as referred to in paragraph (1) after deducting provisions for write-off of financing receivables with substandard, doubtful, and non-performing quality compared to the total balance of financing receivables, exceeding 5% (five percent) of total financing.

Paragraph 4

Provisions for Write-off of Financing Receivables

Article 74
(1) A venture debt corporation as referred to in Article 9 paragraph (1) letter b must calculate provisions for write-off of financing receivables.

(2) The calculation of provisions for write-off of financing receivables as referred to in paragraph (1) is set at minimum:
a. 1% (one percent) of the balance value of financing receivables with performing quality after deducting collateral; b. 5% (five percent) of the balance value of financing receivables with special attention quality after deducting collateral;
c. 15% (fifteen percent) of the balance value of financing receivables with substandard quality after deducting collateral;
d. 50% (fifty percent) of the balance value of financing receivables with doubtful quality after deducting collateral; and e. 100% (one hundred percent) of the balance value of financing receivables with non-performing quality after deducting collateral.

(3) A venture debt corporation as referred to in Article 9 paragraph (1) letter b must:
a. establish provisions for write-off of financing receivables at minimum in accordance with the provisions as referred to in paragraph (2) in monthly reports submitted to the Financial Services Authority; and b. establish provisions in accordance with financial accounting standards in annual financial reports audited by public accountants registered with the Financial Services Authority.

(4) The value of collateral as referred to in paragraph (2) that can be counted as a deduction from the financing balance is set at most equal to the balance of financing receivables.

Paragraph 5

Maximum Financing Limits (BMPP)

Article 75
(1) A venture debt corporation as referred to in Article 9 paragraph (1) letter b must:
a. comply with BMPP provisions to Debtors/Customers who are related parties at most 10% (ten percent) of the Equity of the venture debt corporation as referred to in Article 9 paragraph (1) letter b; b. comply with BMPP provisions to 1 (one) Debtor/Customer who is not a related party at most 20% (twenty percent) of the Equity of the venture debt corporation as referred to in Article 9 paragraph (1) letter b; and
c. comply with BMPP provisions to 1 (one) group of Debtors/Customers who are not related parties at most 25% (twenty-five percent) of the Equity of the venture debt corporation as referred to in Article 9 paragraph (1) letter b.

(2) The basis for calculating Equity in calculating BMPP as referred to in paragraph (1) is the Equity in the latest monthly report of the venture debt corporation as referred to in Article 9 paragraph (1) letter b.

(3) In the event that a venture debt corporation as referred to in Article 9 paragraph (1) letter b obtains a business license for less than 1 (one) month, the basis for calculating Equity in calculating BMPP as referred to in paragraph (1) is the Equity in the financial report submitted at the time of the business license application.

(4) Debtors/Customers are classified as members of a group of Debtors/Customers as referred to in paragraph (1) letter c if the Debtors/Customers have a controlling relationship with other Debtors/Customers, whether through ownership, management, and/or financial relationships, including:
a. Debtors/Customers are controllers of other Debtors/Customers; b. 1 (one) same party is a controller of several Debtors/Customers;
c. Debtors/Customers have financial dependence on other Debtors/Customers;
d. Debtors/Customers issue guarantees to take over and/or settle part or all of the obligations of other Debtors/Customers in the event that such other Debtors/Customers default on the venture debt corporation as referred to in Article 9 paragraph (1) letter b; and/or e. the board of commissioners and/or board of directors of Debtors/Customers become the board of commissioners and/or board of directors of other Debtors/Customers.

(5) BMPP provisions as referred to in paragraph (1) and/or paragraph (2) are excluded for the disbursement of financing and/or financing based on Sharia profit-sharing principles under government assignments in the implementation of government programs.

(6) Government assignments as referred to in paragraph (5) must be based on laws and regulations or decisions established by the government.

Article 76
(1) A venture debt corporation as referred to in Article 9 paragraph (1) letter b that does not comply with the provisions as referred to in Article 75 paragraph (1) may be categorized as exceeding BMPP if caused by:
a. a decrease in Equity; b. exchange rate changes;
c. fair value changes;
d. business mergers and/or changes in management structure causing changes in related parties as referred to in Article 17 paragraph (8) and/or groups of Debtors/Customers; and/or e. changes in laws and regulations.

(2) BMPP exceedances as referred to in paragraph (1) are calculated based on the values recorded on the report date.

A venture debt corporation as referred to in Article 9 paragraph (1) letter b must submit a fulfillment plan at most 1 (one) month since the BMPP excess was established by the Financial Services Authority.

Article 77
(1) The target time for resolving BMPP exceedances as referred to in Article 76 paragraph (1) is set:
a. for BMPP exceedances caused by a decrease in Equity as referred to in Article 76 paragraph (1) letter a, exchange rate changes as referred to in Article 76 paragraph (1) letter b, and fair value changes as referred to in Article 76 paragraph (1) letter c, at most 9 (nine) months; b. for BMPP exceedances caused by business mergers and/or changes in management structure causing changes in related parties as referred to in Article 17 paragraph (8) and/or groups of Debtors/Customers as referred to in Article 76 paragraph (1) letter d, at most 12 (twelve) months; and/or
c. for BMPP exceedances caused by changes in laws and regulations as referred to in Article 76 paragraph (1) letter e, at most 18 (eighteen) months,
since the deadline for submitting the fulfillment plan to the Financial Services Authority.

(2) In the event that the target time for resolving BMPP exceedances as referred to in paragraph (1) is assessed as unachievable, the Financial Services Authority is authorized to establish a new target time for resolving BMPP exceedances for venture debt corporations as referred to in Article 9 paragraph (1) letter b that do not comply with the provisions as referred to in Article 75 paragraph (1).

Article 78
A venture debt corporation as referred to in Article 9 paragraph (1) letter b is prohibited from making agreements or setting requirements that obligate the venture debt corporation as referred to in Article 9 paragraph (1) letter b to provide financing that results in a violation of BMPP.

Part Four

Preservation and Return of Collateral Ownership Evidence

Article 79
(1) In the event that a venture debt corporation as referred to in Article 9 paragraph (1) letter b requires and accepts collateral from Debtors/Customers in financing disbursement, the venture debt corporation as referred to in Article 9 paragraph (1) letter b must store and preserve documents evidencing ownership of the collateral at the headquarters and/or branch offices of the company until the financing agreement ends.

(2) A venture debt corporation as referred to in Article 9 paragraph (1) letter b must have written guidelines and storage locations that meet security standards in storing and preserving evidence of ownership of the collateral.

(3) In the event that the Financial Services Authority assesses that a venture debt corporation as referred to in Article 9 paragraph (1) letter b does not have storage locations for evidence of ownership of the collateral that meet security standards, evidence of ownership of the collateral must be deposited at a depository.

Article 80
(1) A venture debt corporation as referred to in Article 9 paragraph (1) letter b that conducts financing disbursement through subordinated and/or joint financing must ensure that the storage and preservation of evidence of ownership of the collateral is conducted by:
a. fund owners; b. depositories; and/or
c. venture debt corporations as referred to in Article 9 paragraph (1) letter b with the approval of fund owners, if the financing disbursement scheme used is subordinated financing.

(2) A venture debt corporation as referred to in Article 9 paragraph (1) letter b that stores evidence of ownership of the collateral based on the approval of fund owners as referred to in paragraph (1) letter c must have written guidelines and storage locations that meet security standards in storing and preserving evidence of ownership of the collateral.

(3) In the event that the Financial Services Authority assesses that a venture debt corporation as referred to in Article 9 paragraph (1) letter b does not have storage locations for evidence of ownership of the collateral that meet security standards as referred to in paragraph (2), evidence of ownership of the collateral must be deposited at a depository.

Article 81
A venture debt corporation as referred to in Article 9 paragraph (1) letter b is prohibited from pledging the physical evidence of ownership of the collateral to other parties.

Article 82
A venture debt corporation as referred to in Article 9 paragraph (1) letter b must:
a. notify Debtors/Customers regarding the return of evidence of ownership of the collateral; and b. return evidence of ownership of the collateral, at most 1 (one) month since the date of settlement of financing receivables.

Part Five

Debt Collection

Article 83
(1) In the event that Debtors/Customers default, a venture debt corporation as referred to in Article 9 paragraph (1) letter b must conduct debt collection, at minimum by providing warning letters in accordance with the time limits in the financing agreement.

(2) Warning letters as referred to in paragraph (1) must at minimum contain information regarding:
a. the number of days of payment obligation delay; b. the outstanding principal balance;
c. accrued interest; and
d. accrued penalties, if any.

Article 84
(1) A venture debt corporation as referred to in Article 9 paragraph (1) letter b may conduct cooperation with other parties to perform debt collection functions for Debtors/Customers.

(2) A venture debt corporation as referred to in Article 9 paragraph (1) letter b must document cooperation with other parties as referred to in paragraph (1) in the form of a stamped written agreement.

(3) Cooperation with other parties as referred to in paragraph (1) must comply with the provisions:
a. the other party is a legal entity; b. the other party has a license from the competent authority, if required by applicable laws and regulations; and
c. the other party has human resources that have obtained certification in debt collection from a professional certification body in the financing field.

(4) A venture debt corporation as referred to in Article 9 paragraph (1) letter b is fully responsible for all impacts arising from cooperation with other parties as referred to in paragraph (1) as long as the other parties act in accordance with the cooperation agreement.

(5) A venture debt corporation as referred to in Article 9 paragraph (1) letter b must conduct periodic evaluations of cooperation with other parties as referred to in paragraph (1), at minimum 1 (one) time in 1 (one) year.

Article 85
(1) A venture debt corporation as referred to in Article 9 paragraph (1) letter b must have internal guidelines regarding collateral execution.

(2) The Financial Services Authority is authorized to order a venture debt corporation as referred to in Article 9 paragraph (1) letter b to adjust internal guidelines regarding collateral execution.

(3) A venture debt corporation as referred to in Article 9 paragraph (1) letter b must adjust internal guidelines regarding collateral execution based on orders from the Financial Services Authority as referred to in paragraph (2).

Article 86
(1) Collateral execution by a venture debt corporation as referred to in Article 9 paragraph (1) letter b must comply with the following provisions:
a. Debtors/Customers are proven to have defaulted based on criteria as referred to in the financing agreement agreed upon by the parties; and b. Debtors/Customers have been issued warning letters.
c. A venture debt corporation as referred to in Article 9 paragraph (1) letter b has a real right guarantee certificate over the collateral object.

(2) Collateral execution as referred to in paragraph (1) must be implemented in accordance with applicable laws and regulations governing each type of collateral.

(3) Collateral execution as referred to in paragraph (1) must be documented in a collateral execution minutes.

(4) In the event of collateral execution, a venture debt corporation as referred to in Article 9 paragraph (1) letter b must explain to Debtors/Customers information regarding:
a. the outstanding principal balance; b. accrued interest or remuneration;
c. accrued penalties, if any;
d. costs related to collateral execution; and e. the mechanism for selling the collateral in the event that Debtors/Customers do not settle their obligations.

Article 87
(1) In the event that after the execution of collateral, the Debtor/Customer cannot settle obligations within a certain period, the Company in the form of a venture debt corporation as referred to in Article 9 paragraph (1) letter b may only do:
a. sale of collateral through public auction and take repayment of its receivables from the proceeds of the sale; and/or b. private sale of collateral conducted based on price agreement between the Company in the form of a venture debt corporation as referred to in Article 9 paragraph (1) letter b and the Debtor/Customer before the collateral is sold and take repayment of its receivables from the proceeds of the sale. (2) Implementation of the sale of collateral as referred to in paragraph (1) is carried out in accordance with regulations regarding the implementation of collateral sales.

Article 88
(1) The Company in the form of a venture debt corporation as referred to in Article 9 paragraph (1) letter b is required to return excess money from the proceeds of the sale of collateral through public auction as referred to in Article 87 paragraph (1) letter a or private sale of collateral as referred to in Article 87 paragraph (1) letter b to the Debtor/Customer within the time period according to the financing agreement. (2) If the proceeds of the sale of collateral through public auction as referred to in paragraph (1) are insufficient for debt repayment, the Debtor/Customer remains responsible for the unpaid debt.

Part Six
Transparency of Business Activities

Article 89
The Company in the form of a venture debt corporation as referred to in Article 9 paragraph (1) letter b is required to submit a copy of the financing agreement to the Debtor/Customer at most 3 (three) months since the date of the financing agreement.

Article 90
The Company in the form of a venture debt corporation as referred to in Article 9 paragraph (1) letter b is required to inform the Debtor/Customer to read and understand the content of the contract regulated in the financing agreement.

Article 91
The Company in the form of a venture debt corporation as referred to in Article 9 paragraph (1) letter b is required to include information regarding the financing interest rate clearly in:
a. every office of the Company in the form of a venture debt corporation as referred to in Article 9 paragraph (1) letter b; and b. the website of the Company in the form of a venture debt corporation as referred to in Article 9 paragraph (1) letter b.

Article 92
(1) The Company in the form of a venture debt corporation as referred to in Article 9 paragraph (1) letter b is required to explain illustrations:
a. calculation of principal financing receivables and interest or returns during the financing period; and b. imposition of fines and costs of collateral execution, if any, to the Debtor/Customer before signing the financing agreement. (2) The explanation of illustrations to the Debtor/Customer as referred to in paragraph (1) must be recorded in a document signed by the Debtor/Customer.

Part Seven
Compliance Enforcement
Paragraph 1
Compliance Plan

Article 93
(1) The Company in the form of a venture debt corporation as referred to in Article 9 paragraph (1) letter b and UUS that violate provisions as referred to in Article 72 paragraph (1), Article 73 paragraph (6) and/or Article 75 paragraph (1), are given a request letter for a compliance plan by the Financial Services Authority. (2) The Company in the form of a venture debt corporation as referred to in Article 9 paragraph (1) letter b and UUS are required to submit a compliance plan at most 1 (one) month since the date of the request letter for a compliance plan by the Financial Services Authority as referred to in paragraph (1). (3) The compliance plan as referred to in paragraph (2) must contain at least the plan to be carried out by the Company in the form of a venture debt corporation as referred to in Article 9 paragraph (1) letter b and UUS accompanied by a specific time period needed to fulfill the provisions as referred to in paragraph (2). (4) The compliance plan as referred to in paragraph (3) contains:
a. merger, consolidation, or takeover of business entities; b. addition of Paid-up Capital;
c. acceptance of subordinated funding;
d. restriction of activities causing violation of provisions; e. asset restructuring; and/or f. other actions.
(5) The compliance plan as referred to in paragraph (2) must be signed by all members of the Board of Directors and members of the Board of Commissioners.
(6) The compliance plan as referred to in paragraph (2) must first be approved by the General Meeting of Shareholders in case the plan contains a plan for adding Paid-up Capital or a plan for merger, consolidation, or takeover of business entities. (7) The compliance plan as referred to in paragraph (2) must obtain a statement of no objection from the Financial Services Authority. (8) The Financial Services Authority submits requests for improvement, rejection, or statements of no objection regarding the compliance plan submitted by the Company in the form of a venture debt corporation as referred to in Article 9 paragraph (1) letter b as referred to in paragraph (2) within a time period of at most 14 (fourteen) working days since the compliance plan was received. (9) The Financial Services Authority submits a letter requesting improvement of the compliance plan in case the compliance plan, based on the assessment of the Financial Services Authority, still requires improvement. (10) The Company in the form of a venture debt corporation as referred to in Article 9 paragraph (1) letter b and UUS are required to submit a compliance plan that has been improved according to the request of the Financial Services Authority as referred to in paragraph (9) at most 14 (fourteen) working days since the date of the letter requesting improvement of the compliance plan from the Financial Services Authority as referred to in paragraph (8). (11) In case the Company in the form of a venture debt corporation as referred to in Article 9 paragraph (1) letter b and UUS have submitted a compliance plan that has been improved according to the request of the Financial Services Authority, the Financial Services Authority provides a statement of no objection or rejection in accordance with the provisions as referred to in paragraph (8). (12) The Financial Services Authority provides a statement of no objection regarding the compliance plan in case the compliance plan is assessed to be able to resolve issues of provisions that could not yet be fulfilled by the Company in the form of a venture debt corporation as referred to in Article 9 paragraph (1) letter b and UUS. (13) The Financial Services Authority submits rejection regarding the compliance plan in case the compliance plan is assessed to be unable to resolve issues of provisions that could not yet be fulfilled by the Company in the form of a venture debt corporation as referred to in Article 9 paragraph (1) letter b and UUS. (14) If within the time period as referred to in paragraph (8), the Financial Services Authority does not submit a request for improvement, rejection, or statement of no objection, the Company in the form of a venture debt corporation as referred to in Article 9 paragraph (1) letter b and UUS can implement the compliance plan. (15) The Company in the form of a venture debt corporation as referred to in Article 9 paragraph (1) letter b and UUS are required to implement the compliance plan that
has obtained a statement of no objection from the Financial Services Authority as referred to in paragraph (12) or the compliance plan as referred to in paragraph (14). (16) The time period for the compliance plan consisting of actions as referred to in paragraph (4) letter a and letter b is limited to at most 2 (two) years. (17) The time period for the compliance plan consisting of actions as referred to in paragraph (4) letter c through letter f is limited to at most 1 (one) year.

Paragraph 2
Administrative Sanctions

Article 94
(1) The Company in the form of a venture debt corporation as referred to in Article 9 paragraph (1) letter b and UUS that:
a. violate provisions as referred to in Article 93 paragraph (2), paragraph (10), and/or paragraph (15); b. have their compliance plan rejected as referred to in Article 93 paragraph (13); and/or
c. have not fulfilled provisions as referred to in Article 65, Article 67 paragraph (3), paragraph (4), Article 68 paragraph (1), paragraph (3), Article 69 paragraph (1), paragraph (3), Article 70, Article 71 paragraph (1), paragraph (4), Article Article 73 paragraph (1), Article 74 paragraph (1), paragraph (3), Article 76 paragraph (3), Article 78, Article 79, Article 80, Article 81, Article 82, Article 83, Article 84 paragraph (2), paragraph (3), paragraph (4), paragraph (5), Article 85 paragraph (1), paragraph (3), Article 86, Article 88 paragraph (1), Article 89, Article 90, Article 91, and/or Article 92,
are subject to progressive administrative sanctions.
(2) Administrative sanctions as referred to in paragraph (1) consist of:
a. written warning; b. suspension of part or all business activities; and
c. revocation of the business license of the Company in the form of a venture debt corporation as referred to in Article 9 paragraph (1) letter b or revocation of the UUS license.
(3) Besides administrative sanctions as referred to in paragraph (2), the Financial Services Authority has the authority to:
a. lower the health level assessment results; and/or b. conduct a re-evaluation of competence and propriety towards key parties of the Company in the form of a venture debt corporation as referred to in Article 9 paragraph (1) letter b. (4) Administrative sanctions consisting of written warnings as referred to in paragraph (1) letter a are given in writing at most 3 (three) times consecutively with each time period of at most 2 (two) months. (5) In case before the end of the time period for administrative sanctions consisting of written warnings as referred to in paragraph (4), the Company in the form of a venture debt corporation as referred to in Article 9 paragraph (1) letter b and UUS have fulfilled the provisions as referred to in paragraph (1), the Financial Services Authority cancels the administrative sanction consisting of written warnings. (6) In case there is a violation of provisions as referred to in paragraph (1) but the violation has been corrected, the Financial Services Authority gives a written warning sanction that ends automatically. (7) In case the time period for the third written warning as referred to in paragraph (4) ends and the Company in the form of a venture debt corporation as referred to in Article 9 paragraph (1) letter b and UUS still do not fulfill the provisions as referred to in paragraph (2), the Financial Services Authority imposes administrative sanctions consisting of suspension of part or all business activities. (8) Administrative sanctions consisting of suspension of part or all business activities as referred to in paragraph (2) letter b are given in writing and effective from establishment for a time period of at most 6 (six) months. (9) In case the Company in the form of a venture debt corporation as referred to in Article 9 paragraph (1) letter b and UUS are subjected to administrative sanctions consisting of suspension of part or all business activities as referred to in paragraph (7), the Company in the form of a venture debt corporation as referred to in Article 9 paragraph (1) letter b and UUS are prohibited from conducting business activities. (10) In case before the end of the time period for suspension of part or all business activities as referred to in paragraph (8), the Company in the form of a venture debt corporation as referred to in Article 9 paragraph (1) letter b and UUS have fulfilled the provisions as referred to in paragraph (1), the Financial Services Authority cancels the administrative sanction consisting of suspension of part or all business activities. (11) In case administrative sanctions consisting of suspension of part or all business activities are still in effect and the Company in the form of a venture debt corporation as referred to in Article 9 paragraph (1) letter b and UUS continue to conduct business activities, the Financial Services Authority has the authority to directly impose administrative sanctions consisting of revocation of the business license of the
Company in the form of a venture debt corporation as referred to in Article 9 paragraph (1) letter b or revocation of the UUS license. (12) If the time period for administrative sanctions consisting of written warnings and/or suspension of part or all business activities ends on a holiday, the administrative sanctions consisting of written warnings and/or suspension of business activities are effective until the next working day. (13) In case until the end of the time period for suspension of part or all business activities as referred to in paragraph (8), the Company in the form of a venture debt corporation as referred to in Article 9 paragraph (1) letter b and UUS also do not fulfill the provisions as referred to in paragraph (1), the Financial Services Authority revokes the business license of the Company in the form of a venture debt corporation as referred to in Article 9 paragraph (1) letter b or the UUS license concerned. (14) The Financial Services Authority announces administrative sanctions consisting of suspension of part or all business activities as referred to in paragraph (2) letter b and/or revocation of the business license of the Company in the form of a venture debt corporation as referred to in Article 9 paragraph (1) letter b or revocation of the UUS license as referred to in paragraph (2) letter c to the public.

CHAPTER V
BUSINESS ACTIVITY AGREEMENTS
Part One
General

Article 95
(1) All business activity agreements between the Company and Partner Businesses or Debtors/Customers must be made in writing.
(2) Business activity agreements between the Company and Partner Businesses or Debtors/Customers as referred to in paragraph (1) must fulfill provisions regarding the preparation of agreements as regulated in Financial Services Authority Regulations regarding consumer and public protection in the financial services sector.

Article 96
Business activity agreements as referred to in Article 95 paragraph (1) must contain at least:
a. type of business activity; b. number and date of agreement;
c. identity of the parties;
d. amount of participation, financing, financing based on profit-sharing principles, or management of Venture Capital Funds; e. duration of participation, financing, financing based on profit-sharing principles, or management of Venture Capital Funds; f. financing return rate, if any; g. collateral object, if any; h. details of costs related to participation, financing, financing based on profit-sharing principles, or management of Venture Capital Funds;
i. provisions regarding rights and obligations of the parties;
j. provisions regarding giving warnings in case of Debtor/Customer default, specifically for financing distribution activities or financing based on profit-sharing principles,; k. provisions regarding fines, if any;
l. mechanism if disputes occur and choice of dispute resolution venue; and
m. provisions regarding collateral sales and settlement of excess or shortage from the proceeds of collateral sales.

Part Two
Administrative Sanctions

Article 97
(1) Companies that violate provisions as referred to in Article 95 and/or Article 96 are subject to progressive administrative sanctions consisting of:
a. written warning; b. suspension of part or all business activities; and
c. revocation of the company's business license or revocation of the UUS license.
(2) Besides administrative sanctions as referred to in paragraph (1), the Financial Services Authority has the authority to:
a. lower the health level assessment results; and/or b. conduct a re-evaluation of competence and propriety towards key parties of the Company.
(3) Administrative sanctions consisting of written warnings as referred to in paragraph (1) letter a are given in writing at most 3 (three) times consecutively with each time period of at most 2 (two) months. (4) In case before the end of the time period for administrative sanctions consisting of written warnings as referred to in paragraph (3), the Company and UUS have fulfilled the provisions as referred to in paragraph (1), the Financial Services Authority cancels the administrative sanction consisting of written warnings. (5) In case there is a violation of provisions as referred to in paragraph (1) but the violation has been corrected, the Financial Services Authority gives a written warning sanction that ends automatically. (6) In case the time period for the third written warning as referred to in paragraph (3) ends and the Company and UUS still do not fulfill the provisions as referred to in paragraph (1), the Financial Services Authority imposes administrative sanctions consisting of suspension of part or all business activities. (7) Administrative sanctions consisting of suspension of part or all business activities as referred to in paragraph (1) letter b are given in writing and effective from establishment for a time period of at most 6 (six) months. (8) In case the Company and UUS are subjected to administrative sanctions consisting of suspension of part or all business activities as referred to in paragraph (7), they are prohibited from conducting business activities. (9) In case before the end of the time period for suspension of part or all business activities as referred to in paragraph (7), the Company and UUS have fulfilled the provisions as referred to in paragraph (1), the Financial Services Authority cancels the administrative sanction consisting of suspension of part or all business activities. (10) In case administrative sanctions consisting of suspension of part or all business activities are still in effect and the Company and UUS continue to conduct business activities, the Financial Services Authority has the authority to directly impose administrative sanctions consisting of revocation of the business license of the Company or revocation of the UUS license. (11) If the time period for administrative sanctions consisting of written warnings and/or suspension of part or all business activities ends on a holiday, the administrative sanctions consisting of written warnings and/or suspension of business activities are effective until the next working day. (12) In case until the end of the time period for suspension of part or all business activities as referred to in paragraph (6), the Company and UUS also do not fulfill the provisions as referred to in paragraph (1), the Financial Services Authority revokes the business license of the Company or the UUS license concerned. (13) The Financial Services Authority announces administrative sanctions consisting of suspension of part or all business activities as referred to in
paragraph (1) letter b and/or revocation of the business license of the Company or revocation of the UUS license as referred to in paragraph (1) letter c to the public.

CHAPTER VI
FUNDING SOURCES
Part One
General

Article 98
(1) The Company may obtain funding sourced from:
a. addition of Paid-up Capital:

through public stock offering; or
not through public stock offering;
b. loans;
c. issuance of debt securities:
through public offering; or
not through public offering;
d. subordinated loans/funding; e. waqf; and/or f. grants.
(2) Parties that can provide funding as referred to in paragraph (1) consist of:
a. central government or regional government; b. state-owned enterprises or regional-owned enterprises;
c. financial service institutions;
d. multilateral financial institutions; e. individuals; and/or f. other parties.
(3) Parties as referred to in paragraph (2) letter c through letter f can come from domestic or foreign sources.
(4) The Company may only obtain funding sources from individuals as referred to in paragraph (2) letter e for funding sources consisting of:
a. addition of Paid-up Capital not through public stock offering as referred to in paragraph (1) letter a number 2; b. issuance of securities either through public offering or not through public offering as referred to in paragraph (1) letter c;
c. waqf as referred to in paragraph (1) letter e;
d. grants as referred to in paragraph (1) letter f; and/or e. loans as referred to in paragraph (1) letter b and/or subordinated loans as referred to in paragraph (1) letter d which are not intended for financial service business activities as referred to in applicable legislation. (5) Funding sources consisting of waqf as referred to in paragraph (1) letter e can only be conducted by Sharia Venture Capital Companies (PMVS) and/or Sharia Unit Business Units (UUS). (6) For UUS, funding as referred to in paragraph (1) is conducted through PMVs that own such UUS. (7) PMVS and UUS are required to conduct funding activities as referred to in paragraph (1) based on applicable legislation and not contrary to Sharia Principles. (8) Waqf as referred to in paragraph (1) letter e is implemented in accordance with applicable legislation regarding waqf.

Article 99
The Company is required to use funds obtained from funding sources in accordance with the purposes established in the agreement.

Article 100
In case the Company obtains funding sources consisting of loans as referred to in Article 98 paragraph (1) letter b from individuals as referred to in Article 98 paragraph (2) letter e and/or other parties as referred to in Article 98 paragraph (2) letter f, the Company is required to accept loans that fulfill the following provisions:
a. loan repayment period of at least 1 (one) year; b. recorded in the form of a notarial deed agreement between the Company and the lender; and
c. cannot be automatically extended.

Article 101
Companies that will issue debt securities through public offering as referred to in Article 98 paragraph (1) letter a number 1 must fulfill the following provisions:
a. the plan for issuing securities through public offering has been included in the Company's business plan; and b. having a minimum composite health level rating of 2 (two).

Article 102
(1) Companies that will issue debt securities through public offering as referred to in Article 98 paragraph (1) letter a number 1 must submit a securities issuance plan at most 2 (two) months before the General Meeting of Shareholders approving the public offering or limited public offering by attaching documents consisting of:
a. details of the plan for use of funds to be obtained from the public offering;

b. history of previous security issuances (if any) which must contain at least information regarding:

the size of the security issuance;
the rating for debt securities;
the term for debt securities; and
the profile of debt security holders;
c. projected financial statements;
d. information regarding events and significant transactions after the date of the financial statements that have been audited by a public accountant registered with the Financial Services Authority; e. a statement letter from the Board of Directors regarding the plan to issue securities; and f. a management letter in the field of accounting issued by a public accounting firm regarding the plan to issue securities. (2) The Financial Services Authority issues a recording letter regarding the reporting of the plan to issue debt securities through a public offering as referred to in paragraph (1) within a maximum period of 20 (twenty) working days since the report is received in complete form.

Article 103
The issuance of debt securities through a public offering as referred to in Article 98 paragraph (1) letter c number 1 is implemented in accordance with regulations in the field of the capital market.

Article 104
Companies that will issue debt securities not through a public offering as referred to in Article 98 paragraph (1) letter c number 2 must meet the following requirements:
a. the plan to issue debt securities not through a public offering has been included in the Company's business plan; and b. have a minimum health level assessment of composite rating 2 (two).

Article 105
(1) Companies that will issue debt securities not through a public offering as referred to in Article 98 paragraph (1) letter c number 2 must submit the plan to issue securities at the latest 2 (two) months before issuance and attached with documents consisting of:
a. an example of debt security; b. details of the plan for the use of funds to be obtained;
c. a plan for the information memorandum to be offered, containing at least:

the plan for the duration of the debt security offering;
the name of the debt security;
the principal funding amount;
the funding term;
the interest rate, if any;
collateral, if any; and
taxation;
d. history of previous security issuances (if any) which must contain at least information regarding:
the size of the debt security issuance;
the debt security rating;
the term of the debt security issuance; and
the buyer profile;
e. prospective financial statements; f. information regarding events and significant transactions after the date of the financial statements that have been audited by a public accountant registered with the Financial Services Authority; g. a statement from the Board of Directors regarding the plan to issue securities; h. a plan for the debt security rating agency and monitoring agent to be used; and
i. a management letter in the field of accounting issued by a public accounting firm regarding the plan to issue securities.
(2) The Financial Services Authority issues a recording letter regarding the reporting of the plan to issue debt securities not through a public offering as referred to in paragraph (1) within a maximum period of 20 (twenty) working days since the report is received.

Article 106
In the event that a Company issues debt securities not through a public offering as referred to in Article 98 paragraph (1) letter c number 2, the Company must issue debt securities by meeting the following requirements:
a. registered with the Indonesia Central Securities Depository; b. have a monitoring agent registered as a Trustee with the Financial Services Authority;
c. undergo rating with a minimum investment grade rating result conducted by a rating agency that has a business license from the Financial Services Authority; and
d. be rated periodically at least once every 1 (one) year.

Article 107
Companies must submit reports on the realization of the use of funds from the issuance of debt securities as referred to in Article 98 paragraph (1) letter c periodically every 3 (three) months with report dates of March 31, June 30, September 30, and December 31.

Second Section
Subordinated Loans and Funding

Article 108
(1) Subordinated loans as referred to in Article 98 paragraph (1) letter d received by the Company must meet the following requirements:
a. have a term of at least 5 (five) years; b. in the event of liquidation, the claim right applies last among all existing loans; and
c. be stipulated in the form of a notarial deed agreement between the Company and the lender/funder.
(2) Subordinated loans/funding as referred to in paragraph (1) may come from affiliated or non-affiliated parties.

Third Section
Funding in Foreign Currency

Article 109
(1) Companies receiving funding in the form of:
a. loans as referred to in Article 98 paragraph (1) letter b; b. debt securities issued through a public offering as referred to in Article 98 paragraph (1) letter c number 1;
c. debt securities issued not through a public offering as referred to in Article 98 paragraph (1) letter c number 2; and
d. subordinated loans as referred to in Article 98 paragraph (1) letter d, in foreign currency, must fully hedge.
(2) Full hedging as referred to in paragraph (1) must be implemented for the principal funding, interest rate or yield, and/or payment term.

Article 110
Companies receiving funding in the form of foreign currency as referred to in Article 109 must meet a minimum health level assessment of composite rating 2 (two).

Fourth Section
Administrative Sanctions

Article 111
(1) Companies and Business Units that violate regulations as referred to in Article 98 paragraph (7), Article 99, Article 100, Article 101, Article 102 paragraph (1), Article 104, Article 105 paragraph (1), Article 106, Article 107, Article 109, and/or Article 110 are subject to progressive administrative sanctions consisting of:
a. written warning; b. suspension of part or all business activities; and
c. revocation of the Company's business license or revocation of the Business Unit's license.
(2) In addition to administrative sanctions as referred to in paragraph (1), the Financial Services Authority has the authority to:
a. lower the health level assessment result; and/or b. conduct a re-evaluation of the competence and propriety of the Company's principal parties.
(3) Administrative sanctions in the form of written warnings as referred to in paragraph (1) letter a are given in writing at most 3 (three) times consecutively with a duration of each at most 2 (two) months. (4) In the event that before the end of the duration of the administrative sanction in the form of a written warning as referred to in paragraph (3), the Company and Business Unit have met the requirements as referred to in paragraph (1), the Financial Services Authority revokes the administrative sanction in the form of a written warning. (5) In the event that a violation of the regulations as referred to in paragraph (1) occurs but the violation has been corrected, the Financial Services Authority gives a written warning sanction that ends automatically. (6) In the event that the duration of the third warning as referred to in paragraph (3) ends and the Company and Business Unit still do not meet the requirements as referred to in paragraph (1), the Financial Services Authority imposes an administrative sanction in the form of suspension of part or all business activities. (7) Administrative sanctions in the form of suspension of part or all business activities as referred to in paragraph (1) letter b are given in writing and take effect from the date of establishment for a duration of at most 6 (six) months. (8) In the event that the Company and Business Unit are subject to administrative sanctions in the form of suspension of part or all business activities as referred to in paragraph (7), they are prohibited from conducting business activities. (9) In the event that before the end of the duration of suspension of part or all business activities as referred to in paragraph (7), the Company and Business Unit have met the requirements as referred to in paragraph (1), the Financial Services Authority revokes the administrative sanction in the form of suspension of part or all business activities. (10) In the event that the administrative sanction in the form of suspension of part or all business activities is still in effect and the Company continues to conduct business activities, the Financial Services Authority has the authority to directly impose administrative sanctions in the form of revocation of the Company's business license or revocation of the Business Unit's license. (11) If the duration of administrative sanctions in the form of written warnings and/or suspension of business activities ends on a holiday, the administrative sanctions in the form of written warnings and/or suspension of part or all business activities apply until the first working day following. (12) In the event that by the end of the duration of suspension of part or all business activities as referred to in paragraph (6), the Company and Business Unit still do not meet the requirements as referred to in paragraph (1), the Financial Services Authority revokes the business license of the Company or the Business Unit concerned. (13) The Financial Services
Authority announces administrative sanctions in the form of suspension of part or all business activities as referred to in paragraph (1) letter b and/or revocation of the Company's business license or revocation of the Business Unit's license as referred to in paragraph (1) letter c to the public.

CHAPTER VII
HEALTH LEVEL ASSESSMENT

Article 112
(1) The health level assessment of the Company is implemented in accordance with the Financial Services Authority Regulation regarding the health level assessment of non-bank financial service institutions. (2) Regulations regarding the implementation of the health level assessment of the Company are established by the Financial Services Authority.

CHAPTER VIII
RISK MANAGEMENT

Article 113
The application of risk management for the Company is implemented in accordance with the Financial Services Authority Regulation regarding the application of risk management for non-bank financial service institutions.

CHAPTER IX
DETERMINATION OF STATUS AND SUPERVISION FOLLOW-UP

Article 114
(1) The supervision status of the Company is established by the Financial Services Authority.
(2) The supervision status of the Company as referred to in paragraph (1) consists of:
a. normal supervision; b. intensive supervision; or
c. special supervision.
(3) The determination of supervision status as referred to in paragraph (2) is based on factors:
a. composite rating; b. corporate governance factor rating for good corporate governance; and/or
c. quantitative parameters.
(4) The determination of the Company's supervision status as referred to in paragraph (1) is done at any time according to the Financial Services Authority's assessment, taking into account the Company's condition based on factors as referred to in paragraph (3). (5) The determination of the Company in intensive supervision status as referred to in paragraph (2) letter b if it meets the criteria:
a. the Company's health level is set at composite rating 4 (four) or composite rating 5 (five); b. the Company's health level is set at composite rating 3 (three) with a corporate governance factor rating for good corporate governance at rating 4 (four) or rating 5 (five); and/or
c. meets quantitative parameters:

the equity ratio to paid-up capital is greater than or equal to 0% (zero percent) and less than 50% (fifty percent); and/or
the net non-performing financing receivables quality ratio and/or the net non-performing productive assets ratio is greater than 5% (five percent) and less than or equal to 25% (twenty-five percent).
(6) The determination of the Company in special supervision status as referred to in paragraph (2) letter c if it meets the criteria:
a. the Company's health level is set at composite rating 5 (five) with a corporate governance factor rating for good corporate governance at rating 5 (five); and/or b. meets quantitative parameters:
the equity ratio to paid-up capital is less than 0% (zero percent); and/or
the net non-performing financing receivables quality ratio and/or the net non-performing productive assets ratio is greater than 25% (twenty-five percent).
(7) Regulations regarding the determination of status and supervision follow-up for the Company are implemented in accordance with the Financial Services Authority Regulation regarding the determination of status and supervision follow-up for non-bank financial service institutions.

CHAPTER X
MINIMUM EQUITY

First Section
Minimum Equity Fulfillment

Article 115
Companies in the form of venture capital corporations as referred to in Article 9 paragraph (1) letter a must at all times have a Minimum Equity of IDR 50,000,000,000.00 (fifty billion rupiah).

Article 116
Companies in the form of venture debt corporations as referred to in Article 9 paragraph (1) letter b must at all times have a Minimum Equity of IDR 25,000,000,000.00 (twenty-five billion rupiah).

Article 117
Business Units must at all times have a Minimum Equity of IDR 10,000,000,000.00 (ten billion rupiah).

Second Section
Compliance Enforcement

Paragraph 1
Fulfillment Plan

Article 118
(1) Companies and Business Units that violate regulations as referred to in Article 115, Article 116, and/or Article 117, are given a letter requesting a fulfillment plan by the Financial Services Authority. (2) Companies and Business Units must submit a fulfillment plan at the latest 1 (one) month since the date of the letter requesting the fulfillment plan by the Financial Services Authority as referred to in paragraph (1). (3) The fulfillment plan as referred to in paragraph (2) must at least contain the plans to be carried out by the Company and Business Unit accompanied by a specific duration needed to meet the requirements as referred to in paragraph (1). (4) The fulfillment plan as referred to in paragraph (3) contains:
a. merger, consolidation, or takeover of business entities; b. addition of Paid-up Capital;
c. receipt of subordinated funding;
d. restriction of activities causing violation of regulations; e. asset restructuring; and/or f. other actions.
(5) The fulfillment plan as referred to in paragraph (2) must be signed by all members of the Board of Directors and members of the Board of Commissioners.
(6) The fulfillment plan as referred to in paragraph (2) must first be approved by the General Meeting of Shareholders in the event the plan contains a plan for the addition of Paid-up Capital or a plan for the merger, consolidation, or takeover of business entities. (7) The fulfillment plan as referred to in paragraph (2) must obtain a statement of no objection from the Financial Services Authority. (8) The Financial Services Authority submits requests for improvement, rejection, or statements of no objection regarding the fulfillment plan submitted by the Company as referred to in paragraph (2) within a maximum period of 14 (fourteen) working days since the fulfillment plan is received. (9) The Financial Services Authority submits a letter requesting improvement of the fulfillment plan in the event that the fulfillment plan, based on the Financial Services Authority's assessment, still requires improvement. (10) Companies and Business Units must submit the improved fulfillment plan according to the request of the Financial Services Authority as referred to in paragraph (9) at the latest 14 (fourteen) working days since the date of the letter requesting improvement of the fulfillment plan from the Financial Services Authority as referred to in paragraph (8). (11) In the event that the Company and Business Unit have submitted the improved fulfillment plan according to the request of the Financial Services Authority, the Financial Services Authority gives a statement of no objection or rejection in accordance with the regulations as referred to in paragraph (8). (12) The Financial Services Authority gives a statement of no objection regarding the fulfillment plan in the event that the fulfillment plan is assessed to be able to resolve the regulatory issues that have not yet been met by the Company and Business Unit. (13) The Financial Services Authority submits rejection regarding the fulfillment plan in the event that the fulfillment plan is assessed to be unable to resolve the regulatory issues that have not yet been met by the Company and Business Unit. (14) If within the duration as referred to in paragraph (8), the Financial Services Authority does not submit a request for improvement, rejection, or statement of no objection, the Company and Business Unit may implement the fulfillment plan. (15) Companies and Business Units must implement the fulfillment plan that has obtained a statement of no objection from the Financial Services Authority as referred to in paragraph (12) or the fulfillment plan as referred to in paragraph (14). (16) The duration of the fulfillment plan in the form of actions as referred to in paragraph (4) letter a and letter b is limited to at most 2 (two) years. (17) The duration of the fulfillment plan in the form of actions as referred to in paragraph (4) letter c to letter f is limited to at most 1 (one) year.

Paragraph 2
Administrative Sanctions

Article 119
(1) Companies and Business Units that:
a. violate regulations as referred to in Article 118 paragraph (2), paragraph (10), and/or paragraph (15); and/or b. have their fulfillment plan rejected as referred to in Article 118 paragraph (13), are subject to progressive administrative sanctions. (2) Administrative sanctions as referred to in paragraph (1) consist of:
a. written warning; b. suspension of part or all business activities; and
c. revocation of the Company's business license or revocation of the Business Unit's license.
(3) In addition to administrative sanctions as referred to in paragraph (2), the Financial Services Authority has the authority to:
a. lower the health level assessment result; and/or b. conduct a re-evaluation of the competence and propriety of the Company's principal parties.
(4) Administrative sanctions in the form of written warnings as referred to in paragraph (2) letter a are given in writing at most 3 (three) times consecutively with a duration of each at most 2 (two) months. (5) In the event that before the end of the duration of administrative sanctions in the form of written warnings as referred to in paragraph (4), the Company and Business Unit have met the requirements as referred to in paragraph (1), the Financial Services Authority revokes the administrative sanction in the form of written warnings. (6) In the event that a violation of the regulations as referred to in paragraph (1) occurs but the violation has been corrected, the Financial Services Authority gives a written warning sanction that ends automatically. (7) In the event that the duration of the third warning as referred to in paragraph (4) ends and the Company and Business Unit still do not meet the requirements as referred to in paragraph (1), the Financial Services Authority imposes an administrative sanction in the form of suspension of part or all business activities. (8) Administrative sanctions in the form of suspension of part or all business activities as referred to in paragraph (2) letter b are given in writing and take effect from the date of establishment for a duration of at most 6 (six) months. (9) In the event that the Company and Business Unit are subject to administrative sanctions in the form of suspension of part or all business activities as referred to in paragraph (7), the Company and Business Unit are prohibited from conducting business activities. (10) In the event that before the end of the duration of suspension of business activities as referred to in paragraph (8), the Company and Business Unit have met the requirements as referred to in paragraph (1), the Financial Services Authority revokes the administrative sanction in the form of suspension of part or all business activities. (11) In the event that the administrative sanction in the form of suspension of part or all business activities is still in effect and the Company continues to conduct business activities, the Financial Services Authority has the authority to directly impose administrative sanctions in the form of revocation of the Company's business license or revocation of the Business Unit's license. (12) If the duration of administrative sanctions in the form of written warnings and/or suspension of part or all business activities ends on a holiday, the administrative sanctions in the form of written warnings and/or suspension of part or all business activities apply until the first working day following. (13) In the event that by the end of the duration of suspension of part or all business activities as referred to in paragraph (8), the Company and Business Unit still do not meet the requirements as referred to in paragraph (1), the Financial Services Authority revokes the business license of the Company or the Business Unit concerned. (14) The
Financial Services Authority announces administrative sanctions in the form of suspension of part or all business activities as referred to in paragraph (2) letter b and/or revocation of the Company's business license or revocation of the Business Unit's license as referred to in paragraph (2) letter c to the public.

CHAPTER XI
INFORMATION SYSTEM AND INFORMATION TECHNOLOGY

First Section
General

Article 120
(1) In supporting the implementation of good business activities and electronic reporting activities, the Company must have:
a. adequate information systems and information technology; and b. a website.
(2) Information systems, information technology, and websites as referred to in paragraph (1) are adjusted to the complexity of the business and the size of the Company.

Article 121
The Company may delegate the implementation, evaluation, and maintenance of information systems and information technology to third-party information technology service providers in the form of legal entities while still being implemented in accordance with the Financial Services Authority Regulation regarding the application of risk management in the use of information technology by non-bank financial service institutions.

Second Section
Administrative Sanctions

Article 122
(1) Companies and Business Units that violate regulations as referred to in Article 120 paragraph (1) are subject to progressive administrative sanctions consisting of:
a. written warning; b. suspension of part or all business activities; and
c. revocation of the Company's business license or revocation of the Business Unit's license.
(2) In addition to administrative sanctions as referred to in paragraph (1), the Financial Services Authority has the authority to:
a. lower the health level assessment result; and/or b. conduct a re-evaluation of the competence and propriety of the Company's principal parties.
(3) Administrative sanctions in the form of written warnings as referred to in paragraph (1) letter a are given in writing at most 3 (three) times consecutively with a duration of each at most 2 (two) months. (4) In the event that before the end of the duration of administrative sanctions in the form of written warnings as referred to in paragraph (3), the Company and Business Unit have met the requirements as referred to in paragraph (1), the Financial Services Authority revokes the administrative sanction in the form of written warnings. (5) In the event that a violation of the regulations as referred to in paragraph (1) occurs but the violation has been corrected, the Financial Services Authority gives a written warning sanction that ends automatically. (6) In the event that the duration of the third warning as referred to in paragraph (3) ends and the Company and Business Unit still do not meet the requirements as referred to in paragraph (1), the Financial Services Authority imposes an administrative sanction in the form of suspension of part or all business activities. (7) Administrative sanctions in the form of suspension of part or all business activities as referred to in paragraph (1) letter b are given in writing and take effect from the date of establishment for a duration of at most 6 (six) months. (8) In the event that the Company and Business Unit are subject to administrative sanctions in the form of suspension of part or all business activities as referred to in paragraph (7), they are prohibited from conducting business activities. (9) In the event that before the end of the duration of suspension of part or all business activities as referred to in paragraph (7), the Company and Business Unit have met the requirements as referred to in paragraph (1), the Financial Services Authority revokes the administrative sanction in the form of suspension of part or all business activities. (10) In the event that the administrative sanction in the form of suspension of part or all business activities is still in effect and the Company continues to conduct business activities, the Financial Services Authority has the authority to directly impose administrative sanctions in the form of revocation of the Company's business license or revocation of the Business Unit's license. (11) If the duration of administrative sanctions in the form of written warnings and/or suspension of business activities ends on a holiday, the administrative sanctions in the form of written warnings and/or suspension of part or all business activities apply until the first working day following. (12) In the event that by the end of the duration of suspension of part or all business activities as referred to in paragraph (6), the Company and Business Unit still do not meet the requirements as referred to in paragraph (1), the Financial Services Authority revokes the business license of the Company or the Business Unit concerned. (13) The Financial Services Authority
announces administrative sanctions in the form of suspension of part or all business activities as referred to in paragraph (1) letter b and/or revocation of the Company's business license or revocation of the Business Unit's license as referred to in paragraph (1) letter c to the public.

meant in paragraph (7), are prohibited from conducting business activities.
(9) In the event that before the expiration of the freezing period of part or all of the business activities as referred to in paragraph (7), the Company and the UUS have fulfilled the provisions as referred to in paragraph (1), the Financial Services Authority revokes the administrative sanction of freezing part or all of the business activities. (10) In the event that the administrative sanction of freezing part or all of the business activities is still in effect and the Company continues to conduct business activities, the Financial Services Authority is authorized to directly impose administrative sanctions in the form of revocation of the Company's business license or revocation of the UUS license. (11) If the period of the administrative sanction of written warning and/or freezing of part or all of the business activities ends on a holiday, the administrative sanction of written warning and/or freezing of part or all of the business activities remains in effect until the first working day thereafter. (12) In the event that by the end of the freezing period of part or all of the business activities as referred to in paragraph (6), the Company and the UUS have not fulfilled the provisions as referred to in paragraph (1), the Financial Services Authority revokes the business license of the Company or the license of the UUS concerned. (13) The Financial Services Authority announces administrative sanctions of freezing part or all of the business activities as referred to in paragraph (1) letter b and/or revocation of the Company's business license or revocation of the UUS license as referred to in paragraph (1) letter c to the public.

CHAPTER XII
PROHIBITIONS IN THE CONDUCT OF BUSINESS ACTIVITIES

First Section
General

Article 123
In the conduct of business activities, the Company is prohibited from:
a. directly raising funds from the public in the form of current accounts, savings, deposits, and/or other forms equivalent to the raising of public funds; b. providing guarantees in any form for the fulfillment of obligations of other parties; and
c. issuing promissory notes, except as collateral for debts to its creditors.

Second Section
Administrative Sanctions

Article 124
(1) Companies and UUSs that violate the provisions as referred to in Article 123 are subject to graduated administrative sanctions in the form of:
a. written warnings; b. freezing of part or all of the business activities; and
c. revocation of the Company's business license or revocation of the UUS license.
(2) In addition to the administrative sanctions as referred to in paragraph (1), the Financial Services Authority is authorized to:
a. downgrade the health level assessment results; and/or b. conduct a re-evaluation of the competence and propriety of the Company's principal parties.
(3) Administrative sanctions in the form of written warnings as referred to in paragraph (1) letter a are given in writing for a maximum of 3 (three) consecutive times, with each period lasting a maximum of 2 (two) months. (4) In the event that before the expiration of the period of the administrative sanction of written warning as referred to in paragraph (3), the Company and the UUS have fulfilled the provisions as referred to in paragraph (1), the Financial Services Authority revokes the administrative sanction of written warning. (5) In the event that a violation of the provisions as referred to in paragraph (1) occurs but the violation has been remedied, the Financial Services Authority issues a written warning sanction that expires automatically. (6) In the event that the period of the third warning as referred to in paragraph (3) expires and the Company and the UUS still do not fulfill the provisions as referred to in paragraph (1), the Financial Services Authority imposes administrative sanctions in the form of freezing part or all of the business activities. (7) Administrative sanctions in the form of freezing part or all of the business activities as referred to in paragraph (1) letter b are given in writing and take effect from the date of determination for a period of a maximum of 6 (six) months. (8) In the event that the Company and the UUS are subject to administrative sanctions of freezing part or all of the business activities as referred to in paragraph (7), they are prohibited from conducting business activities. (9) In the event that before the expiration of the business activity freezing period as referred to in paragraph (7), the Company and the UUS have fulfilled the provisions as referred to in paragraph (1), the Financial Services Authority revokes the administrative sanction of freezing part or all of the business activities. (10) In the event that the administrative sanction of freezing part or all of the business activities is still in effect and the Company and the UUS continue to conduct business activities, the Financial Services Authority is authorized to directly impose administrative sanctions in the form of revocation of the Company's business license or revocation of the UUS license. (11) If the period of the administrative sanction of written warning and/or freezing of part or all of the business activities ends on a holiday, the administrative sanction of written warning and/or freezing of business activities remains in effect until the first working day thereafter. (12) In the event that by the end of the freezing period of part or all of the business activities as referred to in paragraph (6), the Company and the UUS have not fulfilled the provisions as referred to in paragraph (1), the Financial Services Authority revokes the business license of the Company or the license of the UUS concerned. (13) The Financial Services Authority announces administrative sanctions of freezing part or all of the business
activities as referred to in paragraph (1) letter b and/or revocation of the Company's business license or revocation of the UUS license as referred to in paragraph (1) letter c to the public.

CHAPTER XIII
IMPLEMENTATION OF ANTI-MONEY LAUNDERING PROGRAMS, COUNTER-TERRORISM FINANCING, AND COUNTER-PROLIFERATION FINANCING OF MASS DESTRUCTION WEAPONS, ANTI-FRAUD STRATEGY IMPLEMENTATION, AND CONSUMER PROTECTION

First Section
Implementation of Anti-Money Laundering, Counter-Terrorism Financing, and Counter-Proliferation Financing of Mass Destruction Weapons Programs

Article 125
The implementation of anti-money laundering, counter-terrorism financing, and counter-proliferation financing of mass destruction weapons programs is carried out in accordance with the Financial Services Authority Regulation regarding the implementation of anti-money laundering, counter-terrorism financing, and counter-proliferation financing of mass destruction weapons programs in the financial services sector.

Second Section
Implementation of Anti-Fraud Strategy

Article 126
(1) The Company is required to formulate and implement an effective anti-fraud strategy.
(2) The formulation and implementation of the anti-fraud strategy as referred to in paragraph (1) consists of:
a. prevention; b. detection;
c. investigation, reporting, and sanctions; and
d. monitoring, evaluation, and follow-up.
(3) The implementation of the anti-fraud strategy must be carried out against parties involved in the Company's business activities, which at a minimum includes consumers, the Company's internal parties, and other parties. (4) The implementation of the anti-fraud strategy is carried out in accordance with regulations regarding the implementation of anti-fraud strategies for financial service institutions.

Third Section
Consumer Protection

Article 127
Consumer protection is carried out in accordance with the Financial Services Authority Regulation regarding consumer and community protection in the financial services sector.

CHAPTER XIV
REPORTING

First Section
Periodic Reports

Article 128
(1) The Company is required to prepare:
a. monthly reports; b. annual financial statements audited by a public accountant; and
c. annual Venture Capital Fund financial statements audited by a public accountant.
(2) The UUS is required to prepare monthly reports.
(3) The monthly reports as referred to in paragraph (1) letter a and paragraph (2) consist of:
a. the Company's or UUS's profile report; b. the Company's or UUS's financial report; and
c. the Venture Capital Fund report, for Companies or UUSs that have obtained a Venture Capital Fund license.
(4) Further provisions regarding the format, structure, and method of submission of monthly reports as referred to in paragraph (1) letter a and paragraph (2) are determined by the Financial Services Authority.

Article 129
(1) The Company is required to submit:
a. monthly reports as referred to in Article 128 paragraph (1) letter a to the Financial Services Authority no later than the 10th day of the following month; b. annual financial statements audited by a public accountant as referred to in Article 128 paragraph (1) letter b to the Financial Services Authority no later than April 30 of the following year; and/or
c. annual Venture Capital Fund financial statements audited by a public accountant as referred to in Article 128 paragraph (1) letter c to the Financial Services Authority no later than April 30 of the following year, for Companies that have obtained a Venture Capital Fund management license from the Financial Services Authority,
via online through the Financial Services Authority's data communication network system.
(2) The UUS is required to submit monthly reports as referred to in Article 128 paragraph (2) to the Financial Services Authority no later than the 10th day of the following month via online through the Financial Services Authority's data communication network system. (3) In addition to online submission, the Company is required to submit annual financial statements as referred to in paragraph (1) letter b in printed form to the Financial Services Authority no later than April 30 of the following year. (4) The Company is required to be accountable that every document submitted online as referred to in paragraph (1) and paragraph (2) is a correct document and corresponds to the original document. (5) In the event that the Financial Services Authority's data communication network system as referred to in paragraph (1) and paragraph (2) is not yet available or experiences disturbances, the submission of reports as referred to in paragraph (1) and paragraph (2) is carried out offline. (6) Offline submission as referred to in paragraph (5) is carried out through the Financial Services Authority's email address. (7) In the event of disturbances to the Financial Services Authority's email, offline submission as referred to in paragraph (6) is carried out through the Financial Services Authority's office. (8) If the deadline for report submission as referred to in paragraph (1) and paragraph (2) falls on a holiday, the deadline for report submission is extended to the first working day after the said deadline. (9) The Company appoints a Board of Directors member responsible for the preparation and presentation of the Company's and UUS's monthly reports. (10) The Financial Services Authority is authorized to set different submission deadlines from the provisions as referred to in paragraph (1) and paragraph (2) for specific conditions.

Article 130
(1) The Company is required to prepare annual financial statements as referred to in Article 128 paragraph (1) letter b and annual Venture Capital Fund financial statements as referred to in Article 128 paragraph (1) letter c based on applicable Indonesian financial accounting standards. (2) The Company and UUS are required to prepare reports as referred to in Article 128 paragraph (1) and paragraph (2) in Rupiah currency. (3) The Company is required to use public accountants as referred to in Article 128 paragraph (1) letter b and letter c who are registered with the Financial Services Authority.

Article 131
(1) The Company is required to submit annual Venture Capital Fund financial statements as referred to in Article 128 paragraph (1) letter c to the Venture Capital Fund Unit holders no later than April 30 of the following year. (2) The Company is required to include annual financial statements as referred to in Article 128 paragraph (1) letter b and annual Venture Capital Fund financial statements as referred to in Article 128 paragraph (1) letter c on the Company's website no later than May 31 of the following year. (3) If the submission deadline as referred to in paragraph (1) falls on a holiday, the submission deadline as referred to in paragraph (1) is extended to the next working day.

Second Section
Other Reports

Article 132
(1) The Financial Services Authority is authorized to order the Company and UUS to submit reports other than those referred to in Article 128 paragraph (1) and paragraph (2), information, and/or specific documents for supervision purposes. (2) The Company and UUS are required to comply with the Financial Services Authority's orders as referred to in paragraph (1).

Third Section
Administrative Sanctions

Article 133
(1) Companies and UUSs that violate the provisions as referred to in Article 128 paragraph (1), paragraph (2), Article 129 paragraph (1), paragraph (2), paragraph (3), paragraph (4), Article 130, Article 131 paragraph (1), paragraph (2), and/or Article 132 paragraph (2) are subject to administrative sanctions. (2) Administrative sanctions as referred to in paragraph (1) consist of:
a. written warnings; and b. administrative fines.
(3) In the event that the Company and UUS still do not fulfill the provisions after being subject to administrative sanctions as referred to in paragraph (2), the Financial Services Authority is authorized to:
a. downgrade the health level assessment results; and/or b. conduct a re-evaluation of the competence and propriety of the Company's principal parties.
(4) Administrative sanctions in the form of written warnings as referred to in paragraph (2) letter a are given in writing for a maximum of 3 (three) consecutive times, with each period lasting a maximum of 2 (two) months. (5) In the event that before the expiration of the period of the administrative sanction of written warning as referred to in paragraph (4), the Company and UUS have fulfilled the provisions as referred to in paragraph (1), the Financial Services Authority revokes the administrative sanction of warning. (6) In the event that a violation of the provisions as referred to in paragraph (1) occurs but the violation has been remedied, the Financial Services Authority issues a written warning sanction that expires automatically. (7) In the event that the period of the third warning as referred to in paragraph (4) expires and the Company and UUS still do not fulfill the provisions as referred to in paragraph (1), the Financial Services Authority imposes measures as referred to in paragraph (3). (8) Companies that violate the provisions as referred to in paragraph (1) are subject to additional administrative sanctions in the form of administrative fines of Rp500,000.00 (five hundred thousand Rupiah) for each day of delay and a maximum of Rp25,000,000.00 (twenty-five million Rupiah). (9) If the period of the administrative sanction of written warning as referred to in paragraph (2) letter a ends on a holiday, the administrative sanction of written warning remains in effect until the first working day thereafter.

CHAPTER XV
OTHER PROVISIONS

Article 134
The Financial Services Authority may, based on certain considerations, grant approvals or policies that differ from this Financial Services Authority Regulation.

CHAPTER XVI
TRANSITIONAL PROVISIONS

Article 135
Companies that have obtained business licenses from the Financial Services Authority before this Financial Services Authority Regulation takes effect must fulfill the provisions regarding the inclusion of business activities in the articles of association as referred to in Article 14 paragraph (1) and the correspondence of business categories as referred to in Article 14 paragraph (2) for a maximum of 6 (six) months since this Financial Services Authority Regulation was promulgated.

Article 136
For Companies in the form of venture capital corporations as referred to in Article 9 paragraph (1) letter a that have obtained business licenses before this Financial Services Authority Regulation takes effect, the provisions regarding the minimum participation limit as referred to in Article 17 paragraph (1) take effect 1 (one) year since this Financial Services Authority Regulation was promulgated.

Article 137
The provisions regarding the use of the term Venture Capital Fund as referred to in Article 28 do not apply to Venture Capital Funds that have been formed by Companies in the form of venture capital corporations as referred to in Article 9 paragraph (1) letter a that have obtained business licenses before this Financial Services Authority Regulation was promulgated.

Article 138
Business activity agreements as referred to in Article 96 in the form of financing activities that have been conducted by Companies and UUSs before this Financial Services Authority Regulation takes effect, and are referred to as productive business financing activity agreements, may continue until the end of the financing business activity agreements.

Article 139
The provisions regarding health level assessment as referred to in Article 112 are declared to take effect 1 (one) year since this Financial Services Authority Regulation was promulgated.

Article 140
For Companies and UUSs that have obtained business licenses from the Financial Services Authority before this Financial Services Authority Regulation was promulgated, the fulfillment of provisions as referred to in Article 115, Article 116, and Article 117 must be completed no later than December 31, 2025.

Article 141
For Companies that have obtained business licenses before this Financial Services Authority Regulation takes effect, the provisions regarding the obligation to have information systems, information technology, and websites as referred to in Article 120 paragraph (1) take effect 6 (six) months since this Financial Services Authority Regulation was promulgated.

Article 142
Fulfillment plans that have obtained a statement of no objection from the Financial Services Authority based on Financial Services Authority Regulation Number 35/POJK.05/2015 regarding the Conduct of Business of Venture Capital Companies remain in effect as long as they do not conflict with this Financial Services Authority Regulation.

Article 143
Administrative sanctions that have been imposed against Companies based on Financial Services Authority Regulation Number 35/POJK.05/2015 regarding the Conduct of Business of Venture Capital Companies are declared to remain in effect as long as they do not conflict with this Financial Services Authority Regulation.

Article 144
Companies that:
a. do not implement fulfillment plans that have obtained a statement of no objection as referred to in Article 142; and/or b. have not yet been able to overcome the causes of administrative sanctions as referred to in Article 143, are subject to further administrative sanctions in accordance with this Financial Services Authority Regulation.

CHAPTER XVII
CLOSING PROVISIONS

Article 145
Upon the taking effect of this Financial Services Authority Regulation, Financial Services Authority Regulation Number 35/POJK.05/2015 regarding the Conduct of Business of Venture Capital Companies (State Gazette of the Republic of Indonesia Year 2015 Number 317, Supplement to the State Gazette of the Republic of Indonesia Number 5787) is repealed and declared invalid.

Article 146
This Financial Services Authority Regulation takes effect on the date of promulgation.

This copy is in accordance with the original
Director of Law 1
Legal Department
Mufli Asmawidjaja

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

Determined in Jakarta on December 20, 2023
CHAIRMAN OF THE COMMISSIONERS BOARD
FINANCIAL SERVICES AUTHORITY
REPUBLIC OF INDONESIA,
MAHENDRA SIREGAR

Promulgated in Jakarta on December 22, 2023
MINISTER OF LAW AND HUMAN RIGHTS
REPUBLIC OF INDONESIA,
YASONNA H. LAOLY

STATE GAZETTE OF THE REPUBLIC OF INDONESIA YEAR 2023 NUMBER 43/OJK

signed

EXPLANATION
OF
FINANCIAL SERVICES AUTHORITY REGULATION
OF THE REPUBLIC OF INDONESIA
NUMBER 25 OF 2023
REGARDING
THE CONDUCT OF BUSINESS OF VENTURE CAPITAL COMPANIES AND SHARIA VENTURE CAPITAL COMPANIES

I. GENERAL
With the enactment of Law Number 4 of 2023 concerning the Development and Strengthening of the Financial Sector, which is one of the important milestones in the history of Indonesia's financial sector, including for the Indonesian venture capital industry. Law Number 4 of 2023 concerning the Development and Strengthening of the Financial Sector provides a legal basis for venture capital business activities, including the regulation of venture capital fund management in the form of joint investment contracts, the clarification of the legal entity status of joint investment contracts for venture capital funds, and venture capital activities, namely financing activities through equity participation and/or financing for a certain period for the purpose of business development for business partners or debtors.

Companies play an important role in financing for companies in the early or startup stages, as well as micro, small, and medium-sized enterprises, which cannot be reached through bank financing. On the one hand, companies in the early or startup stages, as well as micro, small, and medium-sized enterprises, are entities capable of expanding employment opportunities and providing broad economic services to the community, playing a role in the process of income distribution and increasing community income, driving economic growth, and playing a role in realizing national stability.

In order to optimize the role of Venture Capital Companies and Sharia Venture Capital Companies as channels for funds for companies in the early or startup stages, as well as micro, small, and medium-sized enterprises, it is necessary to refine the provisions on venture capital business activities. In this regard, the Financial Services Authority establishes a Financial Services Authority Regulation regarding the Conduct of Business of Venture Capital Companies and Sharia Venture Capital Companies.

II. ARTICLE BY ARTICLE

Article 1
Sufficiently clear.

Article 2
Sufficiently clear.

Article 3
Letter a
Sufficiently clear.

Letter b
Sufficiently clear.

Letter c
Sufficiently clear.

Letter d
What is meant by "financing based on profit-sharing principles" includes, among others, the use of mudharabah, musyarakah, mudharabah, musyarakah, and/or other profit-sharing agreements that are in accordance with Sharia Principles.

Article 4
What is meant by "sales financing" is financing in the form of providing goods through sales transactions in accordance with the agreed Sharia financing agreement between the parties.
The implementation of sales financing includes, among others, the use of murabahah, salam, istisna', and/or other sales agreements in accordance with Sharia Principles.

Article 5
Sufficiently clear.

Article 6
Sufficiently clear.

Article 7
What is meant by "adl" is placing something only in its proper place, giving something only to those entitled, and treating something according to its position.
What is meant by "tawazun" is the balance of material and spiritual aspects, private and public aspects, the financial sector and the real sector, business and social aspects, and the balance of utilization and sustainability aspects. What is meant by "maslahah" is all forms of goodness with worldly and hereafter dimensions, material and spiritual, individual and collective, and must meet 3 (three) elements, namely Sharia compliance/halal, beneficial, and bringing goodness (thoyib) in all aspects as a whole without causing harm. What is meant by "alamiyah" is all forms of activities that can be carried out by, with, and for all parties concerned without distinguishing ethnicity, religion, race, and class, in accordance with the spirit of universal mercy (rahmatan lil alamin). What is meant by "gharar" is a transaction where the object is unclear, not owned, its existence is unknown, or it cannot be delivered at the time of the transaction, unless otherwise regulated in Sharia. What is meant by "maysir" is a transaction that is speculative and not directly related to productivity in the real sector. What is meant by "riba" is the assurance of illegal income addition (bathil), among others, in transactions exchanging similar goods that do not have the same quality, quantity, and time of delivery (fadhl), or in lending transactions

which requires the recipient of facilities to return funds received in excess of the loan principal due to the passage of time (riba).

What is meant by “zhulm” is a transaction that causes injustice to other parties.

What is meant by “risywah” is the giving of bribes in the form of money, facilities, or other forms that violate the law as an effort to obtain facilities or ease in a transaction.

What is meant by “haram object” is a good or service that is prohibited in Sharia.

Article 8
It is clear enough.

Article 9
It is clear enough.

Article 10
Letter a
Fee-based activities include among others:
a. consulting services in the fields of administration, accounting, management, and/or marketing; and b. marketing of financial service products such as insurance and/or mutual fund products, which in their implementation the Company fulfills regulations governing the marketing of financial service products in the relevant industry.

Letter b
What is meant by “other activities” is business activities that can be carried out by the Company but cannot be classified in Venture Capital Business and Sharia Venture Capital Business. These other activities result in additional assets in the form of participation and/or financing receivables in the Company's financial position report.

Article 11
It is clear enough.

Article 12
It is clear enough.

Article 13
Paragraph (1)
It is clear enough.

Paragraph (2)
Letter a
What is meant by “new discovery” is a form, device, or process that is new based on a previously existing form, process, composition, or idea.

Letter b
What is meant by “early business stage” is the business cycle where the Business Partner, Debtor, and/or Client have just started the business and have not yet generated profit from their business activities.

Letter c
What is meant by “micro, small, and medium enterprises” is as referred to in the provisions of legislation regarding micro, small, and medium enterprises.

Letter d
What is meant by “business development stage” is the business cycle where the Business Partner, Debtor, and/or Client have started to generate profit but still require development to become more productive.

What is meant by “business decline stage” is the business cycle where the Business Partner, Debtor, and/or Client have passed the early stage and business development stage but then experience business slowdown so that the amount of profit continues to decrease and tends to incur losses.

Letter e
It is clear enough.

Letter f
It is clear enough.

Letter g
It is clear enough.

Letter h
It is clear enough.

Article 14
It is clear enough.

Article 15
Paragraph (1)
It is clear enough.

Paragraph (2)
What is meant by “appraiser” is a person who, with their expertise, carries out asset appraisal activities and provides services to the Company.

Paragraph (3)
It is clear enough.

Article 16
It is clear enough.

Article 17
Paragraph (1)
It is clear enough.

Paragraph (2)
Example: If the Company makes capital participation on January 15, 2024, then the Equity value used as the basis for calculation in these provisions is the Company's equity value based on the monthly financial report for the position in December 2023.

Paragraph (3)
It is clear enough.

Paragraph (4)
It is clear enough.

Paragraph (5)
What is meant by “controller” is a party that directly or indirectly:
a. has the ability to determine the board of directors and/or board of commissioners; and/or b. influences the actions of the board of directors and/or board of commissioners.

Paragraph (6)
It is clear enough.

Paragraph (7)
It is clear enough.

Paragraph (8)
Letter a
It is clear enough.

Letter b
It is clear enough.

Letter c
It is clear enough.

Letter d
It is clear enough.

Letter e
It is clear enough.

Letter f
It is clear enough.

Letter g
It is clear enough.

Letter h
It is clear enough.

Letter i
It is clear enough.

Letter j
Several factors used to determine the existence of financial interdependence between 2 (two) parties are as follows:

The value of transactions between both parties.
In the event there are material transactions between 1 (one) party and another party that directly affect the financial health of that party, it is established that the parties have financial interdependence. An example of a material transaction is when 50% (fifty percent) or more of the gross income or gross expenditure annually from one party comes from transactions with another party;
Transaction relationships between parties that can cause financial dependence as follows:
a. sales dependence on a specific party; b. dependence in the production process where the production or production results of one party significantly depend on another party; and/or
c. dependence on loans or funding sources from a specific party so that in the event of default from the funding source, there are no other alternative funding sources.
An example of a funding source to pay off one party's debt to another party is the same for each party and that party has no other funding sources to repay the debt.
The analysis of these transaction relationships focuses only on the transactional relationship between one party directly with another party; and/or
Cash flow from one party will be significantly disrupted due to disruption of cash flow from another party so that it significantly affects the ability of each party to pay obligations to the Bank. In addition, in the event one party defaults, this can correlate with the default of another party.

Paragraph (9)
It is clear enough.

Paragraph (10)
Example: The Company makes capital participation in PT ABC for a period of 10 (ten) years. Subsequently, in order to strengthen capitalization again, the Company and PT ABC can agree to extend the capital participation period with an additional time of 5 (five) years.

Paragraph (11)
It is clear enough.

Paragraph (12)
It is clear enough.

Paragraph (13)
It is clear enough.

Paragraph (14)
It is clear enough.

Paragraph (15)
Example: The Company makes capital participation in a Business Partner that is a related party with a total participation in that Business Partner amounting to 7% (seven percent) of the Company's Equity. In conducting its business, that Business Partner records positive performance resulting in an increase in its share value so that the capital participation from the Company to that Business Partner, which was originally 7% (seven percent) of the Company's Equity, automatically increases along with the increase in the value of shares per share to 12% (twelve percent) of the Company's Equity.

Article 18
Paragraph (1)
Letter a
Public offerings through the capital market can be carried out on the Indonesian capital market or the capital market of other countries.

Letter b
It is clear enough.

Letter c
It is clear enough.

Letter d
It is clear enough.

Letter e
It is clear enough.

Letter f
Other corporate actions include among others mergers or consolidations.

Paragraph (2)
It is clear enough.

Paragraph (3)
It is clear enough.

Article 19
It is clear enough.

Article 20
It is clear enough.

Article 21
Letter a
It is clear enough.

Letter b
It is clear enough.

Letter c
It is clear enough.

Letter d
Number 1
It is clear enough.

Number 2
The licensing requirements for investment manager representatives are carried out in accordance with the provisions of legislation in the field of capital markets.

Number 3
It is clear enough.

Number 4
What is meant by “within the last 5 (five) years before the submission of the Venture Fund” is the last 5 (five) years since the date of the application for the submission of the Venture Fund license to the Financial Services Authority.

Letter e
It is clear enough.

Letter f
It is clear enough.

Article 22
It is clear enough.

Article 23
It is clear enough.

Article 24
It is clear enough.

Article 25
It is clear enough.

Article 26
Paragraph (1)
It is clear enough.

Paragraph (2)
It is clear enough.

Paragraph (3)
Certain considerations include among others industry development, economic development, and government policy.

Paragraph (4)
It is clear enough.

Article 27
Paragraph (1)
It is clear enough.

Paragraph (2)
It is clear enough.

Paragraph (3)
See the explanation of Article 26 paragraph (3).

Paragraph (4)
It is clear enough.

Article 28
Paragraph (1)
Letter a
When the formation of the Venture Fund is carried out by a Sharia Business Unit (UUS), the use of the Venture Fund name must reflect the name of the Company along with Sharia elements.

Letter b
It is clear enough.

Paragraph (2)
Letter a
It is clear enough.

Letter b
The name of the Venture Fund containing information that is not necessarily true includes among others “Sure Profit Venture Fund” or “Anti-Loss Venture Fund”.

Article 29
It is clear enough.

Article 30
Paragraph (1)
It is clear enough.

Paragraph (2)
See the explanation of Article 26 paragraph (3).

Paragraph (3)
It is clear enough.

Article 31
It is clear enough.

Article 32
Paragraph (1)
Example:
PT XYZ Ventura which manages Venture Fund XYZ Tani Jaya places Venture Fund XYZ Tani Jaya in the form of capital participation. The placement of Venture Fund XYZ Tani Jaya in the form of capital participation is carried out for a maximum period of 10 (ten) years.

Paragraph (2)
It is clear enough.

Article 33
Derivative instruments include among others warrants and options.

Article 34
Paragraph (1)
Letter a
It is clear enough.

Letter b
It is clear enough.

Letter c
It is clear enough.

Letter d
What is meant by “multilateral organization” includes among others international financial institutions.

Paragraph (2)
See the explanation of Article 26 paragraph (3).

Paragraph (3)
It is clear enough.

Article 35
It is clear enough.

Article 36
It is clear enough.

Article 37
Letter a
It is clear enough.

Letter b
It is clear enough.

Letter c
Number 1
It is clear enough.

Number 2
Evidence of settlement of rights and obligations includes settlement agreements.

Number 3
It is clear enough.

Article 38
Paragraph (1)
It is clear enough.

Paragraph (2)
What is meant by “affiliation” is:
a. a relationship between 2 (two) or more companies where there is 1 (one) or more members of the board of directors, management, board of commissioners, or supervisors that are the same; b. a relationship between a company and a party, directly or indirectly, controlling or controlled by the company or that party in determining the management and/or policy of the company or that party;
c. a relationship between 2 (two) or more companies that are controlled, directly or indirectly, in determining the management and/or policy of the company by the same party; or
d. a relationship between a company and a major shareholder, namely a party that directly or indirectly owns at least 20% (twenty percent) of the shares with voting rights from that company.

Article 39
It is clear enough.

Article 40
Paragraph (1)
It is clear enough.

Paragraph (2)
See the explanation of Article 38 paragraph (2).

Paragraph (3)
It is clear enough.

Article 41
It is clear enough.

Article 42
Paragraph (1)
It is clear enough.

Paragraph (2)
Example calculation of gearing ratio:

Loans/funding amounting to Rp100,000,000,000.00 (one hundred billion rupiah)
Equity amounting to Rp40,000,000,000.00 (forty billion rupiah)
Subordinated loans/funding Rp30,000,000,000.00 (thirty billion rupiah)
Gearing ratio:
(Rp100,000,000,000.00) = 1.4 times
(Rp40,000,000,000.00 + Rp30,000,000,000.00)

Paragraph (3)
It is clear enough.

Article 43
It is clear enough.

Article 44
Paragraph (1)
It is clear enough.

Paragraph (2)
It is clear enough.

Paragraph (3)
It is clear enough.

Paragraph (4)
Letter a
Creative economy includes among others fashion, culinary, crafts, film, applications, music, electronic-based trade (e-commerce).

Letter b
It is clear enough.

Letter c
It is clear enough.

Letter d
It is clear enough.

Letter e
It is clear enough.

Letter f
It is clear enough.

Letter g
It is clear enough.

Letter h
It is clear enough.

Letter i
It is clear enough.

Paragraph (5)
It is clear enough.

Paragraph (6)
It is clear enough.

Article 45
Paragraph (1)
It is clear enough.

Paragraph (2)
It is clear enough.

Paragraph (3)
It is clear enough.

Paragraph (4)
Letter a
It is clear enough.

Letter b
It is clear enough.

Letter c
See the explanation of Article 17 paragraph (8) letter j.

Letter d
It is clear enough.

Letter e
It is clear enough.

Paragraph (5)
It is clear enough.

Paragraph (6)
It is clear enough.

Article 46
It is clear enough.

Article 47
It is clear enough.

Article 48
It is clear enough.

Article 49
Paragraph (1)
It is clear enough.

Paragraph (2)
Security standards include among others fireproof safes, termite-resistant, risk of loss or destruction of collateral goods, and rooms with fire prevention systems.

Paragraph (3)
It is clear enough.

Article 50
It is clear enough.

Article 51
It is clear enough.

Article 52
It is clear enough.

Article 53
It is clear enough.

Article 54
It is clear enough.

Article 55
It is clear enough.

Article 56
Paragraph (1)
It is clear enough.

Paragraph (2)
Regulatory provisions governing each collateral include among others the Law on Fiduciary Security and the Law on Mortgage Rights.

Paragraph (3)
It is clear enough.

Paragraph (4)
It is clear enough.

Article 57
Paragraph (1)
What is meant by “specific period” is a period agreed upon by the Debtor/Client with the Company regarding the settlement of obligations in the agreement.

Paragraph (2)
See the explanation of Article 56 paragraph (2).

Paragraph (3)
It is clear enough.

Article 58
It is clear enough.

Article 59
Copies of financing agreements can be in printed and/or electronic copies.

Article 60
It is clear enough.

Article 61
It is clear enough.

Article 62
It is clear enough.

Article 63
Paragraph (1)
It is clear enough.

Paragraph (2)
It is clear enough.

Paragraph (3)
It is clear enough.

Paragraph (4)
Letter a
It is clear enough.

Letter b
It is clear enough.

Letter c
It is clear enough.

Letter d
It is clear enough.

Letter e
It is clear enough.

Letter f
What is meant by “other actions” includes among others actions other than those regulated in letters a to e which are deemed capable of resolving violations.

Paragraph (5)
It is clear enough.

Paragraph (6)
It is clear enough.

Paragraph (7)
It is clear enough.

Paragraph (8)
It is clear enough.

Paragraph (9)
It is clear enough.

Paragraph (10)
It is clear enough.

Paragraph (11)
It is clear enough.

Paragraph (12)
It is clear enough.

Paragraph (13)
It is clear enough.

Paragraph (14)
It is clear enough.

Paragraph (15)
It is clear enough.

Paragraph (16)
It is clear enough.

Paragraph (17)
It is clear enough.

Article 64
It is clear enough.

Article 65
Letter a
It is clear enough.

What is meant by “business development stage” is the business cycle where the Business Partner, Debtor, and/or Client have started to generate profit but still require development to become more productive.

Article 66
Paragraph (1)
Business capital is own capital and borrowed capital to carry out business activities.

Paragraph (2)
It is clear enough.

Paragraph (3)
It is clear enough.

Article 67
Article 69
It is clear enough.

Article 70
It is clear enough.

It is clear enough.

Article 68

Article 71
It is clear enough.

Article 72
Paragraph (1)
It is clear enough.

Paragraph (2)
Example calculation of gearing ratio:
a. loans amounting to Rp100,000,000,000.00 (one hundred billion rupiah); b. subordinated loans amounting to Rp30,000,000,000.00 (thirty billion rupiah);
c. Equity amounting to Rp40,000,000,000.00 (forty billion rupiah); and
d. Paid-up Capital Rp20,000,000,000.00 (twenty billion rupiah) Gearing ratio = (100+30)/(40+10) = 2.6 times.

Paragraph (3)
It is clear enough.

Article 73
Paragraph (1)
The assessment of financing receivable quality is carried out on the balance of financing receivables, not based on the amount of principal and/or interest installments that have fallen due. Steps that the Company can take to keep financing receivables in good condition include among others the application of adequate standard operating procedures and operations and periodic monitoring of receivable quality.

Paragraph (2)
It is clear enough.

Paragraph (3)
It is clear enough.

Paragraph (4)
It is clear enough.

Paragraph (5)
It is clear enough.

Paragraph (6)
It is clear enough.

Article 74
It is clear enough.

Article 75
Paragraph (1)
It is clear enough.

Paragraph (2)
It is clear enough.

Paragraph (3)
It is clear enough.

Paragraph (4)
Letter a
It is clear enough.

Letter b
It is clear enough.

Letter c
See the explanation of Article 17 paragraph (8) letter j.

Letter d
It is clear enough.

Letter e
It is clear enough.

Paragraph (5)
It is clear enough.

Paragraph (6)
It is clear enough.

Article 76
It is clear enough.

Article 77
It is clear enough.

Article 78
It is clear enough.

Article 79
Paragraph (1)
It is clear enough.

Paragraph (2)
See the explanation of Article 49 paragraph (2).

Paragraph (3)
It is clear enough.

Article 80
It is clear enough.

Article 81
It is clear enough.

Article 82
It is clear enough.

Article 83
It is clear enough.

Article 84
It is clear enough.

Article 85
It is clear enough.

Article 86
Paragraph (1)
It is clear enough.

Paragraph (2)
See the explanation of Article 56 paragraph (2).

Paragraph (3)
It is clear enough.

Paragraph (4)
It is clear enough.

Article 87
See the explanation of Article 56 paragraph (2).

Article 88
It is clear enough.

Article 89
See the explanation of Article 59.

Article 90
It is clear enough.

Article 91
It is clear enough.

Article 92
It is clear enough.

Article 93
Paragraph (1)
It is clear enough.

Paragraph (2)
It is clear enough.

Paragraph (3)
It is clear enough.

Paragraph (4)
Letter a
It is clear enough.

Letter b
It is clear enough.

Letter c
It is clear enough.

Letter d
It is clear enough.

Letter e
It is clear enough.

Letter f
See the explanation of Article 63 paragraph (4) letter f.

Paragraph (5)
It is clear enough.

Paragraph (6)
It is clear enough.

Paragraph (7)
It is clear enough.

Paragraph (8)
It is clear enough.

Paragraph (9)
It is clear enough.

Paragraph (10)
It is clear enough.

Paragraph (11)
It is clear enough.

Paragraph (12)
It is clear enough.

Paragraph (13)
It is clear enough.

Paragraph (14)
It is clear enough.

Paragraph (15)
It is clear enough.

Paragraph (16)
It is clear enough.

Paragraph (17)
It is clear enough.

Article 94
It is clear enough.

Article 95
Paragraph (1)
“In writing” includes those drafted digitally or electronically while still meeting the provisions of legislation.

Paragraph (2)
It is clear enough.

Article 96
It is clear enough.

Article 97
It is clear enough.

Article 98
Paragraph (1)
Letter a
It is clear enough.

Letter b
Loans include those carried out based on Sharia Principles.

Letter c
It is clear enough.

Letter d
What is meant by “subordinated loans/funding” includes those carried out based on Sharia Principles.

Letter e
It is clear enough.

Letter f
It is clear enough.

Paragraph (2)
Letter a
Funding originating from the government can among others originate from revolving fund management institutions or other government programs.

Letter b
It is clear enough.

Letter c
It is clear enough.

Letter d
It is clear enough.

Letter e
It is clear enough.

Letter f
Other parties include among others business entities other than state-owned enterprises or regional-owned enterprises.

Paragraph (3)
It is clear enough.

Paragraph (4)
It is clear enough.

Paragraph (5)
It is clear enough.

Paragraph (6)
It is clear enough.

Paragraph (7)
It is clear enough.

Paragraph (8)
It is clear enough.

Article 99
It is clear enough.

Article 100
It is clear enough.

Article 101
It is clear enough.

Article 102
It is clear enough.

Article 103
It is clear enough.

Article 104
It is clear enough.

Article 105
It is clear enough.

Article 106
It is clear enough.

Article 107
It is clear enough.

Article 108
It is clear enough.

Article 109
It is clear enough.

Article 110
The fulfillment of the minimum health assessment composite rating 2 (two) is carried out when receiving funding.

Article 111
It is clear enough.

Article 112
It is clear enough.

Article 113
It is clear enough.

Article 114
Paragraph (1)
It is clear enough.

Paragraph (2)
Letter a
What is meant by “normal supervision” is supervision of a Company that meets the criteria as a Company assessed as not having potential difficulties endangering the continuity of business or as a Company assessed as not experiencing difficulties endangering the continuity of business.

Letter b
What is meant by “intensive supervision” is an increase in the supervision process against a Company that was previously under normal supervision with the aim of returning the Company's condition to become normal supervision status. Actions to return the Company's condition are carried out by establishing supervision actions appropriate to the Company's problems.

Letter c
What is meant by “special supervision” is an increase in the supervision process against a Company that was previously under normal supervision or intensive supervision with the aim of returning the Company's condition to become normal supervision status. Actions to return the Company's condition are carried out by establishing supervision actions appropriate to the Company's problems.

Paragraph (3)
It is clear enough.

Paragraph (4)
It is clear enough.

Paragraph (5)
It is clear enough.

Paragraph (6)
It is clear enough.

Paragraph (7)
It is clear enough.

Article 115
It is clear enough.

Article 116
It is clear enough.

Article 117
It is clear enough.

Article 118
It is clear enough.

Article 119
It is clear enough.

Article 120
It is clear enough.

Article 121
It is clear enough.

Article 122
It is clear enough.

Article 123
It is clear enough.

Article 124
It is clear enough.

Article 125
It is clear enough.

Article 126
It is clear enough.

Article 127
It is clear enough.

Article 128
It is clear enough.

Article 129
Paragraph (1)
Letter a
Example for monthly reports for the January period are submitted no later than February 10.

Letter b
Example annual financial reports ending on December 31, 2023 are submitted no later than April 30, 2024.

Letter c
It is clear enough.

Paragraph (2)
See the explanation of paragraph (1) letter a.

Paragraph (3)
It is clear enough.

Paragraph (4)
It is clear enough.

Paragraph (5)
It is clear enough.

Paragraph (6)
It is clear enough.

Paragraph (7)
It is clear enough.

Paragraph (8)
It is clear enough.

Paragraph (9)
It is clear enough.

Paragraph (10)
Example of specific conditions if there are emergency conditions, the Financial Services Authority can adjust the deadline for submitting monthly reports and annual financial reports.

Article 130
It is clear enough.

Article 131
It is clear enough.

Article 132
It is clear enough.

Article 133
It is clear enough.

Article 134
Example of conditions requiring specific consideration is an extraordinary event which is subsequently abbreviated as KLB that can cause a large increase in illness and death, which also impacts the economy and society, thus requiring attention and handling by all relevant parties and regulated in other provisions regarding consideration in facing possible KLB.

Article 135
It is clear enough.

Article 136
It is clear enough.

Article 137
It is clear enough.

Article 138
It is clear enough.

Article 139
It is clear enough.

Article 140
It is clear enough.

Article 141
It is clear enough.

Article 142
It is clear enough.

Article 143
It is clear enough.

Article 144
It is clear enough.

Article 145
It is clear enough.

Article 146
It is clear enough.

SUPPLEMENT TO THE STATE GAZETTE OF THE REPUBLIC OF INDONESIA NUMBER 65/OJK

Regulation of the Financial Services Authority of the Republic of Indonesia Number 25 of 2023 Concerning the Conduct of Business of Venture Capital Companies and Sharia Venture Capital Companies

Part Two

Financing Cooperation

Part Three

Application of Prudential Principles

Paragraph 1

Scope of Application of Prudential Principles

Paragraph 2

Gearing Ratio

Paragraph 3

Quality of Financing Receivables

Paragraph 4

Provisions for Write-off of Financing Receivables

Paragraph 5

Maximum Financing Limits (BMPP)

Part Four

Preservation and Return of Collateral Ownership Evidence

Part Five

Debt Collection

Lineage: In force