Regulation of the Financial Services Authority of the Republic of Indonesia Number 10/POJK.05/2019 Concerning the Conduct of Business of Sharia Financing Companies and Sharia Business Units of Financing Companies

FINANCIAL SERVICES AUTHORITY
REPUBLIC OF INDONESIA
COPY
FINANCIAL SERVICES AUTHORITY REGULATION
REPUBLIC OF INDONESIA
NUMBER 10/POJK.05/2019
CONCERNING
THE CONDUCT OF BUSINESS OF SHARIA FINANCING COMPANIES AND SHARIA BUSINESS UNITS OF FINANCING COMPANIES BY THE GRACE OF THE ALMIGHTY GOD, THE COMMISSIONERS OF THE FINANCIAL SERVICES AUTHORITY, Considering:
a. that in order to carry out regulatory and supervisory duties in the financing institution sector as referred to in Article 8 and Article 9 of Law Number 21 of 2011 concerning the Financial Services Authority, the Financial Services Authority has the authority to establish legislation regarding financing companies; b. that in order to increase the role of Sharia financing companies and Sharia business units of financing companies in the national economy, improve prudential regulation, and enhance consumer protection, it is necessary to refine the provisions regarding the conduct of business of Sharia financing companies and Sharia business units of financing companies;
c. that based on the considerations referred to in letters a and b, it is necessary to establish a Financial Services Authority Regulation concerning the Conduct of Business of Sharia Financing Companies and Sharia Business Units of Financing Companies;
Recalling: 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); DECIDING:
Establishing: FINANCIAL SERVICES AUTHORITY REGULATION CONCERNING THE CONDUCT OF BUSINESS OF SHARIA FINANCING COMPANIES AND SHARIA BUSINESS UNITS OF FINANCING COMPANIES.

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

1. Sharia Company means a Sharia financing company and a Sharia business unit.
2. Financing Company means a business entity that conducts financing activities for goods and/or services.
3. Sharia Financing Company means a Financing Company whose entire business activities involve Sharia financing.
4. Sharia Financing means the disbursement of financing conducted based on Sharia principles by a Sharia Company.
5. Sharia Business Unit, hereinafter abbreviated as UUS, is a work unit of the head office of a Financing Company that carries out Sharia Financing and/or functions as the head office of offices that carry out Sharia Financing.
6. Sharia Principle means Islamic legal provisions based on fatwas and/or Sharia compliance statements from the National Sharia Council of the Indonesian Ulema Council.
7. Sharia Financing Agreement means a written agreement between a Sharia Company and other parties containing rights and obligations for each party in accordance with the Sharia Principles.
8. Sales Financing means financing in the form of providing goods through a sales transaction in accordance with the Sharia Financing Agreement agreed upon by the parties.
9. Investment Financing means financing in the form of providing capital for a specific period for productive business activities with profit sharing in accordance with the Sharia Financing Agreement agreed upon by the parties.
10. Service Financing means the provision of services, whether in the form of providing benefits over a good, lending, and/or providing services with and/or without service fees in accordance with the Sharia Financing Agreement agreed upon by the parties.
11. Murabahah is the sale of a good by confirming the purchase price or acquisition cost to the buyer, and the buyer pays with a higher price or margin as profit in accordance with the agreement of the parties.
12. Salam is the sale of a good by order according to certain conditions and full payment of the price of the good in advance.
13. Istishna’ is the sale of a good by ordering the manufacture of the good according to specific criteria and requirements, and payment of the price of the good in accordance with the agreement of the parties.
14. Mudharabah is a business cooperation agreement between two parties where the first party provides all capital (shahib mal), while the second party acts as the fund manager (mudharib), and business profits are shared among them in accordance with the agreement of the parties.
15. Musyarakah is financing based on a cooperation agreement between two or more parties for a specific business, where each party provides capital contributions with the provision that profits and risks will be borne together in accordance with the agreement of the parties.
16. Mudharabah Musytarakah is a form of Mudharabah where the fund manager (mudharib) also contributes capital in the cooperation where profits and risks will be borne together in accordance with the agreement of the parties.
17. Musyarakah Mutanaqisah is a Musyarakah or syirkah where the ownership of assets (goods) or capital of one party (syarik) decreases due to the gradual purchase of ownership portions (hishshah) by the other party.
18. Ijarah is the transfer of the right to use (benefit) of a good for a specific period with rental payment, without being accompanied by the transfer of ownership of the good itself.
19. Ijarah Muntahiyah Bittamlik is Ijarah accompanied by a promise of transfer of ownership (wa’d) after the Ijarah period ends.
20. Hawalah is the transfer of debt from one party who owes to another party who is obligated to bear the payment.
21. Hawalah bil Ujrah is Hawalah with the imposition of service fees.
22. Wakalah is the granting of authority from the principal (muwakkil) to the agent (wakil) in matters that can be delegated, where the agent (wakil) does not bear risk for what is delegated, except due to negligence or breach of contract.
23. Wakalah bil Ujrah is Wakalah with the imposition of service fees.
24. Kafalah is a guarantee provided by the guarantor (kafiil) to a third party to fulfill the obligation of the second party or the guaranteed party (makfuul ‘anhu, ashil).
25. Kafalah bil ujrah is Kafalah with the imposition of service fees.
26. Ju’alah is a promise or commitment (iltizam) to provide a specific compensation (reward/’iwadh/ju’l) for achieving a determined result (natijah) from a job.
27. Qardh is interest-free lending with the obligation of the borrower to return the principal loan amount in a lump sum or installments within a specific period.
28. Consumer means a business entity or individual who enters into a Sharia Financing Agreement with a Sharia Company related to the business activities of the Sharia Company.
29. Down Payment for Sharia Motor Vehicle Financing means advance payment or down payment in cash, the source of funds coming from the Consumer for the procurement of motor vehicles using the Sales Financing mechanism.
30. Net Productive Asset Balance (Outstanding Principal) is the total receivables, investments, service receivables, and/or inventory assets for Sharia Financing minus:
    a. unearned revenue; and b. other revenues and expenses related to financing transactions that are amortized.
31. Net Non-Performing Productive Asset means productive assets with poor, doubtful, and default quality for Sharia Financing, after being reduced by provisions for write-off of productive assets for productive assets consisting of poor, doubtful, and default quality productive assets.
32. Net Non-Performing Productive Asset Ratio is the ratio between Net Non-Performing Productive Assets and total productive assets.
33. Financial Health Level is the result of assessing the capital adequacy, quality of productive assets, liquidity, and performance of the Sharia Company.
34. Paid-up Capital is the paid-up capital for Sharia Financing Companies in the form of limited liability companies or principal savings and mandatory savings for Sharia Financing Companies in the form of cooperative legal entities.
35. Equity is equity based on applicable financial accounting standards in Indonesia for Sharia Financing Companies or the difference between the amount of assets and the sum of liabilities and temporary funding for UUS.
36. Board of Directors is the 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 articles of association for Financing Companies in the form of limited liability companies or managers as referred to in legislation in the field of cooperatives for Financing Companies in the form of cooperative legal entities.
37. Board of Commissioners is the company organ tasked with conducting general and/or specific supervision in accordance with the articles of association and providing advice to the Board of Directors for Financing Companies in the form of limited liability companies or supervisory boards as referred to in legislation in the field of cooperatives for Financing Companies in the form of cooperative legal entities.
38. Maximum Limit for Providing Sharia Financing, hereinafter abbreviated as BMPPS, is a specific limit in the disbursement of Sharia Financing permitted under this Financial Services Authority Regulation.
39. Professional Certification Body is an implementing body for professional certification activities that obtains a license from the state agency authorized to grant licenses to professional certification bodies in Indonesia.

CHAPTER II
SHARIA FINANCING ACTIVITIES
First Section
Types of Business Activities and Methods of Sharia Financing
Article 2
The conduct of Sharia Financing activities must fulfill the principles of justice (‘adl), balance (tawazun), public interest (maslahah), and universalism (alamiyah) and must not contain gharar, maysir, riba, zhulm, risywah, and haram objects.
Article 3
(1) Sharia Companies must fulfill Sharia Principles in carrying out business activities and in the use of contracts.
(2) The fulfillment of Sharia Principles as referred to in paragraph (1) in the use of contracts must be supported by:
a. fatwas of the National Sharia Council of the Indonesian Ulema Council or Sharia compliance statements from the National Sharia Council of the Indonesian Ulema Council that serve as the basis for the use of contracts; and b. opinions from the Sharia supervisory board of the Sharia Company regarding the use of specific contracts for Sharia Financing business activities. (3) Sharia Companies must ensure that the Sharia supervisory board conducts an evaluation of the fulfillment of Sharia Principles at least covering:
a. funding activities and Sharia Financing; b. evaluation of standard operating procedures;
c. marketing practices of Sharia Financing conducted by the Sharia Company; and
d. the application of accounting.
Article 4
Sharia Financing includes:
a. Sales Financing; b. Investment Financing; and/or
c. Service Financing.
Article 5
(1) Sales Financing as referred to in Article 4 letter a is conducted using contracts:
a. Murabahah; b. Salam; and/or
c. Istishna’.
(2) Investment Financing as referred to in Article 4 letter b is conducted using contracts:
a. Mudharabah; b. Musyarakah;
c. Mudharabah Musytarakah; and/or
d. Musyarakah Mutanaqishoh.
(3) Service Financing as referred to in Article 4 letter c is conducted using contracts:
a. Ijarah; b. Ijarah Muntahiyah Bittamlik;
c. Hawalah or Hawalah bil Ujrah;
d. Wakalah or Wakalah bil Ujrah; e. Kafalah or Kafalah bil Ujrah; f. Ju’alah; and/or g. Qardh.
(4) The use of Kafalah or Kafalah bil Ujrah contracts as referred to in paragraph (3) letter e can only be conducted by Sharia Companies through a combination of several contracts.
Article 6
Sharia Financing business activities can be conducted using:
a. contracts as referred to in Article 5 paragraphs (1) to (3); or b. contracts other than those referred to in Article 5 paragraphs (1) to (3).
Article 7
Sharia Companies must first report to the Financial Services Authority regarding:
a. every use of contracts as referred to in Article 6 letter a; and/or b. every change in features of Sharia Financing business activities conducted using contracts as referred to in Article 6 letter a that have previously been recorded by the Financial Services Authority.
Article 8
Sharia Companies must first obtain approval from the Financial Services Authority regarding:
a. every use of contracts as referred to in Article 6 letter b; and/or b. every change in features of Sharia Financing business activities conducted using contracts as referred to in Article 6 letter b that have previously been approved by the Financial Services Authority.
Article 9
(1) Sharia Companies may discontinue the use of contracts as referred to in Article 6 in conducting Sharia Financing business activities.
(2) The discontinuation of the use of specific contracts as referred to in paragraph (1) is conducted absolutely.
(3) The discontinuation of the use of specific contracts as referred to in paragraph (1) must be reported to the Financial Services Authority within a maximum period of 15 (fifteen) working days from the date the discontinuation of the specific contract is declared by the Sharia Company.
Article 10
(1) The Financial Services Authority may order Sharia Companies to discontinue the use of specific contracts as referred to in Article 6 for conducting Sharia Financing business activities. (2) The discontinuation of the use of specific contracts as referred to in paragraph (1) is conducted by the Financial Services Authority by considering several aspects including:
a. not fulfilling Sharia Principles as referred to in Article 3 paragraph (1); b. no evaluation of the fulfillment of Sharia Principles by the Sharia supervisory board of the Sharia Company as referred to in Article 3 paragraph (3);
c. contrary to provisions of legislation;
d. potentially causing financial losses to the Sharia Company; e. indicated to harm Consumer interests; f. inadequate risk management; and/or g. contrary to practices generally applied in the implementation of Sharia Financing. (3) The discontinuation of the use of specific contracts as referred to in paragraph (1) can be conducted absolutely or partially. (4) Sharia Companies may submit a request for the reinstatement of the use of contracts that have been discontinued absolutely and/or partially if the causes for the discontinuation of the use of contracts have disappeared or are no longer material. (5) Sharia Companies must implement the order to discontinue the use of specific contracts as referred to in paragraph (1).
Article 11
Sharia Financing Companies and Financing Companies that have UUS must clearly state the Sharia Financing activities as referred to in Article 4 in their articles of association.

Second Section
Product Committee and Development of Sharia Business Activities
Article 12
(1) Sharia Companies must form a product committee and development of Sharia business activities.
(2) The product committee and development of Sharia business activities as referred to in paragraph (1) must perform at least the following tasks and functions:
a. conducting studies and analyses for the development of new products or business activities to be conducted or marketed; b. conducting evaluations and refinements of every product or business activity;
c. providing recommendations, suggestions, and inputs as well as evaluations regarding marketing aspects and the fulfillment of Sharia principles and risk mitigation; and
d. formulating and proposing monthly and annual performance targets for business activities based on Sharia Principles.
(3) The product committee and development of Sharia business activities as referred to in paragraph (1) is chaired by:
a. the Chief Executive Director or equivalent for Sharia Financing Companies; or b. the head of the UUS for UUS.
(4) The product committee and development of Sharia business activities as referred to in paragraph (1) must hold meetings at least 1 (one) time in every 6 (six) months. (5) The implementation of committee tasks as referred to in paragraph (2) must be reported in governance reporting as regulated in Financial Services Authority Regulations regarding good governance for Financing Companies.

CHAPTER III
INFORMATION SYSTEMS AND TECHNOLOGY
Article 13
(1) Sharia Companies must have integrated information systems and technology.
(2) The obligation as referred to in paragraph (1) applies to Sharia Companies that have more than 5 (five) branch offices.
Article 14
(1) Sharia Companies may conduct their business activities by utilizing information technology.
(2) To conduct business activities by utilizing information technology as referred to in paragraph (1), Sharia Companies must fulfill the following requirements:
a. having standard operating procedures related to business activities utilizing information technology; b. having human resources with expertise and/or background in information technology;
c. having data centers and disaster recovery centers located in Indonesia; and
d. having reliable and secure information technology systems.

CHAPTER IV
DOWN PAYMENT FOR SHARIA MOTOR VEHICLE FINANCING
Article 15
(1) Sharia Companies that have a Financial Health Level with a minimum healthy condition and have a Net Non-Performing Productive Asset Ratio for Sharia Motor Vehicle Financing lower than or equal to 1% (one percent) may apply the following down payment amounts for Sharia Motor Vehicle Financing to Consumers:
a. for two-wheeled or three-wheeled motor vehicles, at least 0% (zero percent) of the selling price of the respective vehicle; b. for four-wheeled or more motor vehicles used for productive purposes, at least 0% (zero percent) of the selling price of the respective vehicle; or
c. for four-wheeled or more motor vehicles used for non-productive purposes, at least 0% (zero percent) of the selling price of the respective vehicle.
(2) Sharia Companies that have a Financial Health Level with a minimum healthy condition and have a Net Non-Performing Productive Asset Ratio for Sharia Motor Vehicle Financing higher than 1% (one percent) and lower than or equal to 3% (three percent) must apply the following down payment amounts for Sharia Motor Vehicle Financing to Consumers:
a. for two-wheeled or three-wheeled motor vehicles, at least 5% (five percent) of the selling price of the respective vehicle; b. for four-wheeled or more motor vehicles used for productive purposes, at least 5% (five percent) of the selling price of the respective vehicle; or
c. for four-wheeled or more motor vehicles used for non-productive purposes, at least 10% (ten percent) of the selling price of the respective vehicle.
(3) Sharia Companies that have a Financial Health Level with a minimum healthy condition and have a Net Non-Performing Productive Asset Ratio for Sharia Motor Vehicle Financing higher than 3% (three percent) and lower than or equal to 5% (five percent) must apply the following down payment amounts for Sharia Motor Vehicle Financing to Consumers:
a. for two-wheeled or three-wheeled motor vehicles, at least 10% (ten percent) of the selling price of the respective vehicle; b. for four-wheeled or more motor vehicles used for productive purposes, at least 10% (ten percent) of the selling price of the respective vehicle; or
c. for four-wheeled or more motor vehicles used for non-productive purposes, at least 15% (fifteen percent) of the selling price of the respective vehicle.
(4) Sharia Companies that do not meet the Financial Health Level with a minimum healthy condition and have a Net Non-Performing Productive Asset Ratio for Sharia Motor Vehicle Financing lower than or equal to 5% (five percent) must apply the following down payment amounts for Sharia Motor Vehicle Financing to Consumers:
a. for two-wheeled or three-wheeled motor vehicles, at least 15% (fifteen percent) of the selling price of the respective vehicle; b. for four-wheeled or more motor vehicles used for productive purposes, at least 20% (twenty percent) of the selling price of the respective vehicle; or
c. for four-wheeled or more motor vehicles used for non-productive purposes, at least 25% (twenty-five percent) of the selling price of the respective vehicle.
(5) Sharia Companies that have a Net Non-Performing Productive Asset Ratio for Sharia Motor Vehicle Financing higher than 5% (five percent) must apply the following down payment amounts for Sharia Motor Vehicle Financing to Consumers:
a. for two-wheeled or three-wheeled motor vehicles, at least 15% (fifteen percent) of the selling price of the respective vehicle; b. for four-wheeled or more motor vehicles used for productive purposes, at least 20% (twenty percent) of the selling price of the respective vehicle; or
c. for four-wheeled or more motor vehicles used for non-productive purposes, at least 25% (twenty-five percent) of the selling price of the respective vehicle.
(6) Four-wheeled or more motor vehicles used for productive purposes as referred to in paragraph (1) letter b, paragraph (2) letter b, paragraph (3) letter b, paragraph (4) letter b, and paragraph (5) letter b must meet at least the following criteria:
a. being a passenger or cargo transport vehicle that has a license issued by the competent authority to conduct specific business activities; or b. being applied for by an individual or legal entity that has a specific business license from the competent authority and is used for business activities relevant to the business license held. (7) Sharia Motor Vehicle Financing provided by Sharia Companies to Consumers in motor vehicle ownership programs with other corporations is exempt from the obligation to apply the down payment amounts for Sharia Motor Vehicle Financing to Consumers as referred to in paragraphs (1) to (5). (8) The motor vehicle ownership program as referred to in paragraph (7) must be stipulated in a cooperation agreement between the Sharia Company and the other corporation that can provide certainty of the collectability of the productive assets of the Sharia Financing that has been provided. (9) The certainty of the collectability of the productive assets of the Sharia Financing that has been provided as referred to in paragraph (8) can be in the form of:
a. installment payments through a salary deduction mechanism from employees of the respective corporation; and b. guarantees on the productive assets of the Sharia Financing.
Article 16
(1) The application of the down payment amounts for Sharia Motor Vehicle Financing as referred to in Article 15 paragraphs (1) to (5) is calculated based on monthly reports as of June 30 and December 31. (2) The application of the down payment amounts for Sharia Motor Vehicle Financing as referred to in Article 15 paragraphs (1) to (5) shall take effect

on August 1 or February 1 for a period of 6 (six) months thereafter.
(3) The calculation of the amount of Down Payment for Islamic Motor Vehicle Financing as referred to in Article 15 paragraphs (1) to (5) is conducted against the selling price of the vehicle after deducting price discounts and other deductions. (4) The calculation of the amount of Down Payment for Islamic Motor Vehicle Financing as referred to in Article 15 paragraphs (1) to (5) does not include the first installment, survey fees, provisos, Sharia insurance, Sharia guarantee, fiduciary, notary, and/or other costs. (5) Incentive costs provided by the Sharia Company to third parties related to the acquisition of Islamic Financing cannot be calculated in the calculation of the amount of Down Payment for Islamic Motor Vehicle Financing as referred to in Article 15 paragraphs (1) to (5).

CHAPTER V
LIMITS ON THIRD-PARTY INCENTIVES

Article 17
(1) The Sharia Company is prohibited from providing acquisition incentive costs for Islamic Financing to third parties exceeding 17.5% (seventeen point five percent) of the value of revenue to be received related to the Islamic Financing for each Islamic Financing Agreement. (2) The revenue to be received related to the Islamic Financing as referred to in paragraph (1) consists of:
a. profit-sharing/margin/service fee revenue before considering the cost of fund; b. revenue from discounts on Sharia insurance and/or Sharia guarantee;
c. administrative revenue; and
d. proviso revenue.

CHAPTER VI
MAXIMUM LIMITS FOR PROVIDING ISLAMIC FINANCING

Article 18
(1) The Sharia Company is required to meet the Maximum Financing Limits for Related Parties (BMPPS) to all related parties at a maximum of 50% (fifty percent) of the Sharia Company's Equity. (2) The basis for calculating Equity in calculating BMPPS as referred to in paragraph (1) is the Equity in the Sharia Company's latest monthly report before the disbursement of Islamic Financing is carried out. (3) If the Islamic Financing Company obtains a business license for less than 1 (one) month or the UUS obtains a UUS license for less than 1 (one) month, the basis for calculating Equity in calculating BMPPS as referred to in paragraph (1) is the Equity in the financial report submitted at the time of the license application. (4) Related parties as referred to in paragraph (1) include:
a. individuals or business entities that are controllers of the Islamic Financing Company and Financing Companies that have a UUS; b. business entities where the Islamic Financing Company and Financing Companies that have a UUS act as controllers;
c. individuals or business entities that act as controllers of business entities as referred to in letter b;
d. business entities whose control is exercised by:

1. individuals and/or business entities as referred to in letter a; or
2. individuals and/or business entities as referred to in letter c;
   e. Board of Commissioners or Board of Directors, or equivalent boards of commissioners or directors of Financing Companies that have a UUS; f. parties having family relationships up to the second degree, both horizontal and vertical:
3. from individuals who are controllers of the Islamic Financing Company and Financing Companies that have a UUS as referred to in letter a; and/or
4. from the Board of Commissioners or Board of Directors, or equivalent boards of commissioners or directors of Financing Companies that have a UUS as referred to in letter e;
   g. boards of commissioners or directors in business entities as referred to in letters a through d; h. business entities whose boards of commissioners and/or directors are:
5. the Board of Commissioners or Board of Directors, or equivalent boards of commissioners or directors of Financing Companies that have a UUS; or
6. boards of commissioners or directors in business entities as referred to in letters a through d;
   i. business entities where:
7. the Board of Commissioners or Board of Directors, or equivalent boards of commissioners or directors of Financing Companies that have a UUS as referred to in letter e act as controllers; or
8. boards of commissioners or directors of parties as referred to in letters a through d act as controllers; and
   j. business entities that have financial interdependence with the Sharia Company and/or parties as referred to in letters a through i.
   (5) The Sharia Company is required to have and account for a detailed list of related parties as referred to in paragraph (4).

Article 19
(1) The Sharia Company is required to meet the Maximum Financing Limits for Related Parties (BMPPS) to 1 (one) Consumer who is not a related party as referred to in Article 18 paragraph (4) at a maximum of 20% (twenty percent) of the Sharia Company's Equity. (2) The Sharia Company is required to meet the Maximum Financing Limits for Related Parties (BMPPS) to 1 (one) group of Consumers who are not related parties as referred to in Article 18 paragraph (4) at a maximum of 50% (fifty percent) of the Sharia Company's Equity. (3) The basis for calculating Equity in calculating BMPPS as referred to in paragraphs (1) and (2) is the Equity in the Sharia Company's latest monthly report before the disbursement of Islamic Financing is carried out. (4) If the Islamic Financing Company obtains a business license for less than 1 (one) month or the UUS obtains a UUS license for less than 1 (one) month, the basis for calculating Equity in calculating BMPP as referred to in paragraphs (1) and (2) is the Equity in the financial report submitted at the time of the license application. (5) Consumers are classified as members of a group of Consumers as referred to in paragraph (2) if the Consumers have a control relationship with other Consumers either through ownership, management, and/or financial relationships, which include:
a. Consumers are controllers of other Consumers; b. 1 (one) same party is a controller of several Consumers (common ownership);
c. Consumers have financial interdependence with other Consumers;
d. Consumers issue guarantees to take over and/or settle part or all of the obligations of other Consumers in the event that such other Consumers fail to fulfill their obligations (default) to the Sharia Company; and/or e. the boards of commissioners and/or directors of Consumers become boards of commissioners and/or directors on other Consumers.

Article 20
The provisions on BMPPS as referred to in Article 18 paragraph (1), and Article 19 paragraphs (1) and (2) are exempted for Islamic Financing for the procurement of goods and/or services in government programs.

CHAPTER VII
MITIGATION OF ISLAMIC FINANCING RISKS

Article 21
(1) The Sharia Company is required to conduct mitigation of Islamic Financing risks.
(2) Mitigation of Islamic Financing risks as referred to in paragraph (1) can be done by:
a. transferring Islamic Financing risks through Sharia guarantee mechanisms in accordance with applicable regulations; b. transferring risks over collateral from Islamic Financing activities through Sharia insurance mechanisms; and/or
c. imposing fiduciary guarantees, liens, or mortgages on collateral from Islamic Financing activities.

Article 22
(1) Sharia Companies that conduct risk mitigation through risk transfer as referred to in Article 21 paragraph (2) letter a are required to use Sharia guarantee institutions that meet the following provisions:
a. have obtained a business license from the Financial Services Authority; and b. are not subject to administrative sanctions in the form of suspension of business activities by the Financial Services Authority. (2) The term of Sharia guarantee as referred to in Article 21 paragraph (2) letter a is at least equal to the term of Islamic Financing.

Article 23
(1) Sharia Companies that conduct risk mitigation through risk transfer as referred to in Article 21 paragraph (2) letter b are required to use Sharia insurance companies or Sharia units in insurance companies that meet the following provisions:
a. have obtained a business license from the Financial Services Authority; and b. are not subject to administrative sanctions in the form of restriction of business activities by the Financial Services Authority. (2) The term of Sharia insurance coverage as referred to in Article 21 paragraph (2) letter b is at least equal to the term of Islamic Financing.

Article 24
(1) Sharia Companies that conduct risk mitigation through Sharia guarantee as referred to in Article 21 paragraph (2) letter a and/or Sharia insurance as referred to in Article 21 paragraph (2) letter b are required to calculate the results of Sharia guarantee claims and/or Sharia insurance claims over collateral in the settlement of Islamic Financing. (2) In the event that there is an excess of Sharia insurance claim results against the Consumer's obligations, the Sharia Company is required to return the excess funds from the Sharia insurance claims to the Consumer within a period in accordance with the Islamic Financing Agreement.

Article 25
(1) Sharia Companies that conduct risk mitigation through the imposition of fiduciary guarantees as referred to in Article 21 paragraph (2) letter c are required to register the fiduciary guarantee in question at the fiduciary registration office, in accordance with applicable regulations regarding fiduciary guarantees. (2) The obligation to register fiduciary guarantees as referred to in paragraph (1) also applies to Sharia Companies that conduct Sale and Purchase Financing with the imposition of fiduciary guarantees where the financing uses a cooperation mechanism in the form of channeling financing or joint financing.

Article 26
Sharia Companies that conduct Islamic Financing with the imposition of fiduciary guarantees are required to register the fiduciary guarantee as referred to in Article 25 at the fiduciary registration office at the latest 1 (one) month from the date of the Islamic Financing Agreement.

Article 27
Sharia Companies that conduct risk mitigation through the imposition of liens or mortgages as referred to in Article 21 paragraph (2) letter c are required to meet provisions regarding the imposition of collateral with liens and mortgages in accordance with applicable regulations regarding liens and mortgages.

CHAPTER VIII
TRANSPARENCY OF BUSINESS ACTIVITIES

Part One
Islamic Financing Agreements

Article 28
(1) All Islamic Financing Agreements between Islamic Financing Companies or Financing Companies that have a UUS with Consumers must be made in writing.
(2) Islamic Financing Agreements between Islamic Financing Companies or Financing Companies that have a UUS with Consumers must meet agreement drafting provisions as regulated in Financial Services Authority Regulations regarding consumer protection in the financial services sector.

Article 29
Islamic Financing Agreements as regulated in Article 28 must meet the following provisions:
a. are implemented without elements of coercion among the parties to the contract or transaction; and b. the objects contained in the Islamic Financing Agreement are in accordance with Sharia Principles and applicable regulations.

Article 30
Islamic Financing Agreements agreed upon by the parties cannot be cancelled, except:
a. the parties agree to terminate it; and/or b. the legal conditions as referred to in Article 29 are not met.

Article 31
(1) Islamic Financing Agreements in Islamic Financing must at least contain:
a. the title of the Islamic Financing Agreement describing the type of Sharia contract used; b. the number and date of the Islamic Financing Agreement;
c. the identity of the parties, including other parties conducting Islamic Financing cooperation with the Sharia Company (if any);
d. the object of the Islamic Financing Agreement (capital, goods, and/or services); e. the purpose of the Islamic Financing; f. the value of the object of the Islamic Financing Agreement (capital, goods, and/or services); g. the mechanism and method of payment and its amount; h. the term of the Islamic Financing;
i. the profit-sharing ratio (nisbah), margin, and/or service fee of the Islamic Financing;
j. collateral including storage of proof of ownership over the collateral (if any); k. details of costs related to Islamic Financing consisting of:

1. survey fees (if any);
2. Sharia insurance fees (if any);
3. Sharia guarantee fees (if any);
4. collateral imposition fees (if any);
5. proviso fees (if any);
6. notary fees (if any); and/or
7. other fees (if any);
   l. clear clauses on the imposition of fiduciary guarantees, liens, or mortgages, if there is collateral imposition in Islamic Financing activities;
   m. mechanisms in the event of disputes and the choice of dispute resolution venue; n. provisions on giving warnings in the event of Consumer default; o. provisions on collateral execution in the event of Consumer default; p. provisions on collateral sales in the event of Consumer default (if any); q. provisions regarding the mechanism for settling productive assets and returning excess funds from collateral sales or Sharia insurance claims, accompanied by the time limit, in the event the Sharia Company conducts risk mitigation through the methods referred to in Article 21 paragraph (2) letters b and c; r. illustrations of the distribution of productive asset principal, profit-sharing ratio (nisbah), margin, and/or service fee of Islamic Financing; s. provisions regarding the rights and obligations of the parties; and t. provisions regarding penalties (ta’zir) and/or compensation (ta`widh). (2) In the event that the Sharia Company conducts Sale and Purchase Financing for motor vehicles, the Islamic Financing Agreement must state the down payment amount.

Article 32
The Sharia Company is required to submit a copy of the Islamic Financing Agreement to the Consumer at the latest 3 (three) months from the date of the Islamic Financing Agreement.

Article 33
The Sharia Company is required to post announcements at the head office, branch offices, and offices other than branch offices informing prospective Consumers and Consumers to read and understand the contents of the contract regulated in the Islamic Financing Agreement.

Part Two
Transparency of Profit-Sharing Ratios (Nisbah), Margins, Service Fees, Penalties (Ta’zir), and/or Compensation (Ta`widh)

Article 34
The Sharia Company is required to state information regarding the level of profit-sharing ratios (nisbah), margins, and/or service fees of Islamic Financing clearly at every head office, branch office, office other than branch office, and the website of the Sharia Company.

Article 35
(1) The Sharia Company is required to explain illustrations of the calculation of financing principal, profit-sharing ratios (nisbah), margins, and/or service fees during the term of Islamic Financing, as well as illustrations of the imposition of penalties (ta’zir) and/or compensation (tawidh) to Consumers, in the event of Consumer default, before the signing of the Islamic Financing Agreement. (2) The explanation of illustrations to Consumers as referred to in paragraph (1) must be recorded in a document signed by the Consumer. (3) The calculation of financing principal, profit-sharing ratios (nisbah), margins, and/or service fees during the term of Islamic Financing, as well as illustrations of the imposition of penalties (ta’zir) and/or compensation (tawidh) as referred to in paragraph (1) are prohibited from contradicting Sharia Principles. (4) The Sharia Company is required to separately administer funds originating from penalties (ta’zir). (5) The Sharia Company is required to use funds originating from penalties (ta’zir) in accordance with Sharia Principles.

CHAPTER IX
ISLAMIC FINANCING COOPERATION

Article 36
(1) In conducting Islamic Financing as referred to in Article 4, Sharia Companies may cooperate with other parties through channeling financing or joint financing. (2) Cooperation of Sharia Companies with other parties through channeling financing or joint financing as referred to in paragraph (1) must be conducted in accordance with applicable regulations governing each party and is prohibited from contradicting Sharia Principles. (3) Sharia Companies are prohibited from conducting Islamic Financing cooperation with other parties through channeling financing with recourse and joint financing with recourse schemes. (4) Other parties as referred to in paragraph (1) include:
a. banks; b. secondary housing financing companies;
c. microfinance institutions;
d. Sharia Companies; e. companies providing internet-based lending services; f. venture capital companies; and/or g. other institutions permitted by applicable regulations to conduct Islamic Financing cooperation through channeling financing and joint financing schemes. (5) In conducting cooperation as referred to in paragraph (2), Sharia Companies are required to cooperate with banks, microfinance institutions, Sharia Companies, companies providing internet-based lending services, and venture capital companies that have obtained business licenses, UUS licenses, or are registered with the Financial Services Authority.

Article 37
(1) Channeling financing as referred to in Article 36 paragraph (1) must be conducted using the Wakalah bil Ujrah contract.
(2) In conducting channeling financing as referred to in Article 36 paragraph (1), Sharia Companies may act as:
a. the party disbursing (manager/agent) through Islamic Financing activities; and/or b. the provider of funds/capital/goods, i.e., the party delegating to other parties. (3) In the event that the Sharia Company acts as the party disbursing (manager/agent) as referred to in paragraph (2) letter a, the Sharia Company only acts as a manager and obtains fees from the management of those funds. (4) Sharia Companies may only conduct channeling financing as referred to in Article 36 paragraph (1) if the risks arising from this activity are borne by the owner of the funds/capital/goods.

Article 38
(1) Sharia Companies may only conduct joint financing as referred to in Article 36 paragraph (1) using contracts that do not contradict Sharia Principles.
(2) The use of contracts as referred to in paragraph (1) must be in accordance with contracts permitted in Islamic Financing activities.
(3) Sharia Companies may only conduct joint financing as referred to in Article 36 paragraph (1) if the financing funds originate from the Sharia Company and other parties. (4) Risks arising from joint financing as referred to in paragraph (3) become the burden of each party proportionally according to the amount of funds disbursed.

Article 39
In conducting financing cooperation through channeling financing and/or joint financing, Sharia Companies are required to have adequate information and technology systems to ensure the consistency of Consumer data owned by the Sharia Company and other parties as referred to in Article 36 paragraph (4).

CHAPTER X
MAINTENANCE AND RETURN OF PROOF OF OWNERSHIP OVER COLLATERAL

Article 40
(1) In the event that the Sharia Company disburses Islamic Financing where the funds do not originate from channeling financing and/or joint financing cooperation, the Sharia Company is required to store and maintain documents proving ownership over collateral at the head office and/or branch offices of the Sharia Company until the Islamic Financing Agreement ends. (2) The Sharia Company is required to have written guidelines for storing and maintaining proof of ownership over collateral. (3) The Sharia Company is required to mitigate risks regarding the storage and maintenance of proof of ownership over collateral. (4) In the event that the Financial Services Authority assesses that the Sharia Company does not have a storage place for proof of ownership over collateral that meets security standards, the proof of ownership over collateral must be deposited at a custodian.

Article 41
(1) Sharia Companies that disburse Islamic Financing through channeling financing and/or joint financing are required to ensure that the storage and maintenance of proof of ownership over collateral is done by:
a. the owner of the funds; b. deposited at a custodian; and/or
c. the Sharia Company with the approval of the owner of the funds.
(2) Provisions as referred to in Article 40 paragraphs (2) to (4) apply mutatis mutandis to Sharia Companies that store proof of ownership over collateral done by the Sharia Company based on the approval of the owner of the funds as referred to in paragraph (1) letter c.

Article 42
(1) Sharia Companies are prohibited from pawning and/or pledging the physical proof of ownership over collateral to other parties.
(2) Sharia Companies are prohibited from pledging the value of productive assets of 1 (one) Consumer to more than 1 (one) party providing loans to the Sharia Company.

Article 43
(1) The Sharia Company is required to notify Consumers regarding the return of proof of ownership over collateral at the latest 1 (one) month from the date of settlement of Islamic Financing. (2) Based on the notification as referred to in paragraph (1), the Sharia Company is required to return the proof of ownership and/or documents related to the collateral at the latest 1 (one) month from the existence of a request from the Consumer.

CHAPTER XI
DEBT COLLECTION

Article 44
(1) In the event of Consumer default, the Sharia Company is required to conduct debt collection, at least by providing a warning letter in accordance with the time limit in the Islamic Financing Agreement. (2) The warning letter as referred to in paragraph (1) must at least contain information regarding:
a. the number of days of payment delay; b. Outstanding Principal owed;
c. profit-sharing ratio (nisbah), margin, and/or service fee of Islamic Financing owed;
d. penalties (ta’zir) owed; and e. compensation (ta`widh) owed.

Article 45
(1) Sharia Companies may cooperate with other parties to perform collection functions towards Consumers.
(2) Sharia Companies must formalize 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 meet the following provisions:
a. the other party is a legal entity; b. the other party has a permit from the competent authority; and
c. the other party has human resources that have obtained certification in the field of collection from a Professional Certification Body in the field of Sharia Financing.
(4) Sharia Companies are fully responsible for all impacts arising from cooperation with other parties as referred to in paragraph (1).
(5) Sharia Companies must conduct periodic evaluations of cooperation with other parties as referred to in paragraph (1).

Article 46
(1) Sharia Companies must have internal guidelines regarding collateral execution.
(2) The Financial Services Authority is authorized to request Sharia Companies to adjust internal guidelines regarding collateral execution.
(3) Sharia Companies must adjust internal guidelines regarding collateral execution based on the request of the Financial Services Authority as referred to in paragraph (2).

Article 47
(1) Collateral execution by Sharia Companies must meet the following provisions:
a. the Consumer is proven to be in breach of contract; b. the Consumer has been issued a warning letter; and
c. the Sharia Company holds a fiduciary certificate, a mortgage right certificate, and/or a mortgage certificate.
(2) Collateral execution as referred to in paragraph (1) must be carried out in accordance with the provisions of laws and regulations governing each type of collateral. (3) Collateral execution as referred to in paragraph (1) must be recorded in a collateral execution minutes. (4) In the event of collateral execution, Sharia Companies must explain to the Consumer information regarding:
a. Outstanding Principal balance due; b. nisbah, margin, and/or remuneration for Sharia Financing due;
c. penalties (ta’zir) due;
d. compensation (ta`widh) due; and e. the mechanism for selling collateral in the event the Consumer does not fulfill their obligations.

Article 48
(1) In the event that after collateral execution and the Consumer is unable to fulfill obligations within a certain period, Sharia Companies may only perform:
a. the sale of collateral through public auction and taking the settlement of their claims from the sale proceeds; and/or b. the sale of collateral under hand which is conducted based on price agreement between the Sharia Company and the Consumer before the collateral is sold. (2) The implementation of the sale as referred to in paragraph (1) letter b is carried out after 1 (one) month has passed since written notification by the Sharia Company to the Consumer and announced in at least 2 (two) newspapers circulating in the respective region.

Article 49
Sharia Companies must return any excess funds from the proceeds of the sale of collateral through public auction as referred to in Article 48 paragraph (1) letter a or the sale of collateral under hand as referred to in Article 48 paragraph (1) letter b to the Consumer within the time period specified in the Sharia Financing Agreement.

CHAPTER XII
FRAUD CONTROL AND ANTI-FRAUD STRATEGY
First Section
Fraud Control

Article 50
(1) Sharia Companies must implement fraud control.
(2) Fraud control as referred to in paragraph (1) includes the following aspects:
a. active management supervision; b. organizational structure and accountability;
c. control and monitoring; and
d. education and training.

Article 51
Active management supervision as referred to in Article 50 paragraph (2) letter a must at least include:
a. comprehensive fraud control carried out by the Board of Directors and commissioners of Financing Companies that have Sharia Business Units (UUS) in performing their duties, authorities, and responsibilities; b. the authority, duties, and responsibilities of the Board of Directors and commissioners of Financing Companies that have UUS in performing fraud control, which generally cover:

1. the development of culture and concern for anti-fraud at all levels of the organization, at least by:
   a) declaring anti-fraud regulations; and b) adequate communication to all levels of the company organization regarding behavior that constitutes fraud;
2. the formulation and supervision of the implementation of codes of ethics in fraud prevention for all levels of the organization;
3. the formulation and supervision of the implementation of anti-fraud strategies;
4. the development of human resource (HR) quality, particularly related to increasing awareness and fraud control;
5. monitoring and evaluation of fraud incidents and the determination of follow-up actions; and
6. the development of effective communication channels within the Sharia Company so that all levels of the Sharia Company organization understand and comply with applicable policies and procedures, including policies in fraud control; and
   c. the Board of Commissioners of Sharia Financing Companies and the Board of Commissioners of Financing Companies that have UUS are responsible for periodically monitoring fraud control.

Article 52
(1) In the application of the organizational structure and accountability aspect as referred to in Article 50 paragraph (2) letter b, Sharia Companies must form a unit or function tasked with handling fraud control within the Sharia Company organization. (2) The formation of the unit or function as referred to in paragraph (1) must at least meet the following criteria:
a. the organizational structure is adjusted to the characteristics and complexity of the Sharia Company's business activities; b. the determination of clear job descriptions and responsibilities;
c. the accountability of the unit or function is directly to the President Director or equivalent of Sharia Financing Companies and Financing Companies that have UUS, as well as direct communication and reporting relationships to the Board of Commissioners of Sharia Financing Companies and the Board of Commissioners of Financing Companies that have UUS; and
d. the execution of duties in the unit or function is carried out by human resources (HR) that have competence, integrity, and independence, as well as supported by clear accountability.

Article 53
(1) Sharia Companies must conduct fraud control and monitoring as referred to in Article 50 paragraph (2) letter c to increase the effectiveness of the internal control system. (2) Steps in fraud control and monitoring as referred to in paragraph (1) must at least be as follows:
a. the determination of policies and procedures for control specifically aimed at fraud control; b. control through review, both by management (top level review) and operational review (functional review) by internal audit regarding the implementation of anti-fraud strategies;
c. control in the field of human resources (HR) aimed at increasing the effectiveness of task execution and fraud control;
d. the determination of separation of functions in the implementation of Sharia Company activities at all levels of the organization, for example, the separation of functions between the departments that process acceptance, claims, and finance, with the aim that each party involved in these activities does not have the opportunity to commit and conceal fraud; e. information system control that supports processing, storage, and electronic data security to prevent the potential occurrence of fraud; and f. other controls in fraud control such as physical asset and documentation control.

Article 54
(1) In the application of the education and training aspect as referred to in Article 50 paragraph (2) letter d, Sharia Companies must have an education and training plan for employees involved in the implementation of anti-fraud strategies. (2) The education and training plan as referred to in paragraph (1) must at least include:
a. education and training adjusted to the needs of the Sharia Company and the complexity of the Sharia Company's business organization; and b. the stages and timing of implementation at least 1 (one) time in 1 (one) year.

Second Section
Anti-Fraud Strategy

Article 55
(1) Sharia Companies must implement anti-fraud strategies that include:
a. prevention; b. detection;
c. investigation, reporting, and sanctions; and
d. monitoring, evaluation, and follow-up.
(2) The implementation of anti-fraud strategies is carried out towards parties involved in Sharia Financing business activities, at least including:
a. Consumers; b. internal Sharia Companies; and
c. other parties cooperating with Sharia Companies.

Article 56
(1) The implementation of anti-fraud strategies as referred to in Article 55 paragraph (1) must be formulated in guidelines which serve as a reference for Sharia Companies to implement anti-fraud strategies. (2) In formulating anti-fraud strategy guidelines as referred to in paragraph (1), Sharia Companies must pay attention to at least the following matters:
a. internal and external environmental conditions; b. the complexity of business activities;
c. the potential, type, and risk of fraud; and
d. the adequacy of resources required.

Article 57
Prevention steps in reducing the possibility of fraud risk as referred to in Article 55 paragraph (1) letter a must at least include:
a. anti-fraud awareness at least includes:

1. the formulation and socialization of anti-fraud statements;
2. employee awareness programs; and
3. customer awareness programs;
   b. vulnerability identification at least includes:
4. conducting processes to identify, analyze, and assess every activity of Sharia Companies that has the potential to harm Sharia Companies;
5. documenting and informing the results of identification to interested parties; and
6. updating information, especially regarding activities assessed as having a high risk of fraud occurrence; and
   c. know your employee at least includes:
7. effective recruitment systems and procedures;
8. selection systems equipped with appropriate qualifications considering risks, and established objectively and transparently; and
9. policies for recognizing employees (know your employee).

Article 58
Detection as referred to in Article 55 paragraph (1) letter b is an activity in identifying and finding fraud incidents, which must at least include:
a. policies and whistleblowing mechanisms formulated clearly, easily understood, and can be implemented effectively, at least including:

1. protection for whistleblowers and ensuring the confidentiality of the reporter's identity and fraud reports submitted;
2. formulating internal regulations regarding fraud complaints referring to laws and regulations; and
3. formulating fraud reporting systems which must at least contain:
   a) reporting procedures; b) facilities; c) parties responsible for handling reports; and d) follow-up mechanisms for reported fraud incidents; b. policies and surprise audit mechanisms carried out at least on high-risk or vulnerable business units against fraud occurrence;
   c. policies and surveillance system mechanisms which are activities to monitor and test the effectiveness of anti-fraud policies carried out without the knowledge or awareness of the tested or examined parties; and
   d. surveillance system policies are carried out by independent parties and/or internal parties of Sharia Companies.

Article 59
Investigation, reporting, and sanction steps by Sharia Companies as referred to in Article 55 paragraph (1) letter c must have at least the following:
a. Sharia Company investigation standards include:

1. the determination of parties authorized to conduct investigations considering the required independence and competence; and
2. the implementation mechanism of investigations in following up detection results while maintaining the confidentiality of information obtained;
   b. mechanisms for reporting fraud incidents to internal Sharia Companies or to the Financial Services Authority; and
   c. the application of sanction policies to provide a deterrent effect for perpetrators of fraud by Sharia Companies must be applied transparently and consistently, at least including:
3. sanction imposition mechanisms; and
4. parties authorized to impose sanctions.

Article 60
Monitoring, evaluation, and follow-up activities of fraud incidents as referred to in Article 55 paragraph (1) letter d consist of:
a. monitoring follow-up actions on fraud incidents considering internal Sharia Company regulations and laws and regulations; b. maintaining fraud incident data (fraud profiling) to support the implementation of evaluations; and
c. follow-up mechanisms to prevent fraud incidents from recurring, at least including steps for:

1. correcting weaknesses; and
2. strengthening the internal control system of Sharia Companies.

Third Section
Reporting

Article 61
(1) Sharia Companies must submit anti-fraud strategy reports to the Financial Services Authority as follows:
a. reports on the implementation of anti-fraud strategies as part of the implementation report of good corporate governance for Sharia Companies; and b. reports on every fraud incident estimated to have a significant negative impact on Sharia Companies. (2) Reports on every fraud incident as referred to in paragraph (1) letter b must at least contain:
a. the name of the perpetrator; b. the form or type of deviation;
c. the location of the incident;
d. brief information regarding the modus operandi; and e. indications of losses.
(3) Reports on every fraud incident as referred to in paragraph (1) letter b are submitted by the Board of Commissioners and the Board of Commissioners of Financing Companies that have UUS, who receive reports on the accountability of the unit or function for fraud control, at the latest 3 (three) working days after the fraud is known.

CHAPTER XIII
CERTIFICATION AND CONTINUING REQUIREMENTS FOR KEY PARTIES

Article 62
(1) Employees of Sharia Companies holding managerial positions from the level of branch head to one level below the Board of Directors and the leadership of UUS must have basic level certificates in the field of financing and/or Sharia Financing from a Professional Certification Body in the field of Sharia Financing registered with the Financial Services Authority. (2) The Board of Directors of Sharia Financing Companies must have expertise certificates in the field of financing and/or Sharia financing from a Professional Certification Body in the field of Sharia Financing registered with the Financial Services Authority. (3) The Board of Commissioners of Sharia Financing Companies must have basic level certificates in the field of financing and/or Sharia financing from a Professional Certification Body in the field of Sharia Financing registered with the Financial Services Authority. (4) The Board of Directors and officials 1 (one) level below the Board of Directors of Sharia Financing Companies who oversee risk management functions must have expertise certificates in the field of risk management from a Professional Certification Body in the field of risk management registered with the Financial Services Authority. (5) Employees and/or outsourced personnel of Sharia Companies handling collection and collateral execution functions must have professional certificates in the field of collection from a Professional Certification Body in the field of Financing registered with the Financial Services Authority.

Article 63
(1) Members of the Board of Directors, members of the Board of Commissioners, and/or members of the Sharia Supervisory Board of Sharia Companies who have passed the competency and propriety assessment must meet continuing requirements at least 1 (one) time within a period of 1 (one) year. (2) The obligation of continuing requirements as referred to in paragraph (1) starts to be calculated in the following calendar year after the members of the Board of Directors, members of the Board of Commissioners, or members of the Sharia Supervisory Board of Sharia Companies are approved by the Financial Services Authority as members of the Board of Directors, members of the Board of Commissioners, or members of the Sharia Supervisory Board of Sharia Financing Companies. (3) Fulfillment of continuing requirements as referred to in paragraph (1) must be done by:
a. attending seminars, workshops, or similar activities; b. attending courses, training, or similar educational programs;
c. writing papers, articles, or other published works; and/or
d. becoming speakers in activities as referred to in letter a, becoming teachers, or becoming instructors in activities as referred to in letter b.
(4) The material of activities as referred to in paragraph (3) must be in the field of the financial industry.
(5) Activities as referred to in paragraph (1) and paragraph (3) letters a, b, and d, must be organized by:
a. financial services regulatory bodies inside and outside the country; b. financial services associations inside and outside the country;
c. universities inside and outside the country; or
d. training institutions that have permits from competent authorities.

Article 64
Certificates or other evidence showing that members of the Board of Directors and members of the Board of Commissioners of key parties have met the continuing requirements as referred to in Article 63 paragraph (1) must be submitted to the Financial Services Authority at the latest 1 (one) month after the annual period ends.

CHAPTER XIV
INVESTMENT PARTICIPATION

Article 65
(1) Sharia Financing Companies may only perform direct investments in:
a. companies in the financial services sector in Indonesia; and/or b. companies related to the activities of Sharia Financing Companies.
(2) The total amount of direct investments by Sharia Financing Companies as referred to in paragraph (1) is prohibited from exceeding 20% (twenty percent) of the Equity of Sharia Financing Companies. (3) The total amount of direct investments by Sharia Financing Companies to entities within 1 (one) group is prohibited from exceeding 10% (ten percent) of the Equity of Sharia Financing Companies. (4) Sharia Financing Companies must meet the provisions on the amount of direct investments as referred to in paragraph (2) and paragraph (3) at the time of making the investment.

CHAPTER XV
FUNDING

Article 66
(1) Sharia Companies may only obtain funding in the form of:
a. increased Paid-in Capital not through public stock offerings or increased working capital for UUS; b. funding from government agencies, banks, non-bank financial industries, institutions, and/or other business entities;
c. subordinated funding;
d. issuance of Sharia securities through public offerings; e. issuance of sukuk not through public offerings; f. securitization of productive assets in accordance with Sharia Principles and laws and regulations; and/or g. funding to UUS from its parent Financing Company. (2) For UUS, funding as referred to in paragraph (1) letters a to f is conducted through the parent Financing Company. (3) Sharia Companies must use funds obtained from funding sources in accordance with the purposes established in the agreement. (4) Sharia Companies must conduct funding activities as referred to in paragraph (1) based on laws and regulations and must not conflict with Sharia Principles.

Article 67
(1) Funding as referred to in Article 66 paragraph (1) letters b to d and letter g must be conducted using contracts:
a. Mudharabah; b. Mudharabah Musytarakah;
c. Musyarakah;
d. Ijarah; e. Qardh; and/or f. other funding contracts in accordance with Sharia Principles.
(2) In the event that Sharia Companies receive funding from institutions and/or other business entities as referred to in Article 66 paragraph (1) letter b, Sharia Companies must receive funding that meets the following provisions:
a. the amount of funding is at least IDR 500,000,000.00 (five hundred million rupiah) for each provider of funding; b. the repayment period of funding is at least 1 (one) year; and
c. it is formulated in the form of a notarial deed agreement between Sharia Companies and the provider of funding; and
d. it cannot be automatically extended (automatic roll over).

Article 68
Subordinated funding received by Sharia Companies as referred to in Article 66 paragraph (1) letter c must meet the following provisions:
a. with a minimum duration of 5 (five) years; b. in the event of liquidation, the claim rights apply last among all existing funding or financial obligations; and
c. formulated in the form of a notarial deed agreement between Sharia Companies and the provider of funding.

Article 69
Sharia Companies that will issue Sharia securities through public offerings as referred to in Article 66 paragraph (1) letter d must meet the following requirements:
a. the plan to issue Sharia securities through public offerings has been included in the Sharia Company's business plan; b. having a financial health level with a minimum healthy condition;
c. having a minimum risk level of low-medium; and
d. meeting the gearing ratio provisions.

Article 70
(1) Sharia Companies that will issue Sharia securities through public offerings as referred to in Article 66 paragraph (1) letter d must report the plan to issue Sharia securities at the latest 3 (three) months before the General Meeting of Shareholders that approves the public offering or limited offering according to Format 1 as contained in the Appendix which is an integral part of this Financial Services Authority Regulation, by attaching documents in the form of:
a. details of the plan for the use of funds to be obtained from the public offering; b. the history of previous Sharia securities issuances (if any) which must at least contain information regarding:

1. the size of the Sharia securities issuance;
2. ratings for debt-type Sharia securities;
3. the duration for debt-type Sharia securities; and
4. the profile of holders of debt-type securities;
   c. financial statement projections;
   d. information regarding events and important transactions after the date of the financial statements audited by a public accounting firm; e. statements from the Board of Directors and commissioners of Financing Companies that have UUS according to Format 2 as contained in the Appendix which is an integral part of this Financial Services Authority Regulation; and f. management statements in the field of accounting. (2) The Financial Services Authority issues a recording letter regarding the report of the plan to issue Sharia securities through public offerings as referred to in paragraph (1) within a maximum period of 20 (twenty) working days since the report is received completely.

Article 71
The provisions on the issuance of Sharia securities through public offerings as referred to in Article 66 paragraph (1) letter d follow the provisions of laws and regulations in the field of capital markets.

Article 72
Sharia Companies that will issue sukuk not through public offerings as referred to in Article 66 paragraph (1) letter e must meet the following requirements:
a. the plan to issue sukuk not through public offerings has been included in the Sharia Company's business plan; b. having a financial health level with a minimum healthy condition;
c. having a minimum risk level of low-medium;
d. meeting the gearing ratio provisions; and e. having Equity greater than IDR 200,000,000,000.00 (two hundred billion rupiah).

Article 73
(1) Sharia Companies intending to issue sukuk not through a public offering as referred to in Article 66 paragraph (1) letter e must report the plan for the issuance of sukuk not through a public offering at the latest 6 (six) months before the issuance in accordance with Format 3 as stated in the Annex which is an inseparable part of this Financial Services Authority Regulation, accompanied by documents:
a. a sample of the sukuk issued not through a public offering; b. details of the plan for the use of funds to be obtained;
c. a plan for the information memorandum to be offered, which must contain at least information regarding:

1. the plan for the sukuk offering period;
2. the name of the sukuk;
3. the principal funding amount;
4. the funding period;
5. the ratio, margin, and/or remuneration (if any);
6. collateral (if any); and
7. taxation;
   d. the history of previous sukuk issuances (if any) which must contain at least information regarding:
8. the size of the sukuk issuance;
9. the sukuk rating;
10. the sukuk issuance period; and
11. the buyer profile;
    e. prospective financial reports; f. information regarding significant events and transactions after the date of the financial report audited by a public accounting firm; g. a statement from the Board of Directors and directors of the Financing Company that has a Sharia Business Unit (UUS) in accordance with Format 4 as stated in the Annex which is an inseparable part of this Financial Services Authority Regulation; h. a plan for the sukuk rating agency and monitoring agent to be used; and
    i. a management statement in the field of accounting.
    (2) The Financial Services Authority issues a recording letter regarding the report of the plan for the issuance of sukuk not through a public offering as referred to in paragraph (1) within a maximum period of 20 (twenty) working days since the report was received.

Article 74
In the event that a Sharia Company issues sukuk not through a public offering as referred to in Article 66 paragraph (1) letter e, the Sharia Company must issue sukuk that meet the following provisions:
a. registered at 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 rating result of investment grade, 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 75
(1) Sharia Companies must submit reports on the realization of the use of funds from the issuance of sukuk not through a public offering as referred to in Article 66 paragraph (1) letter e periodically every 3 (three) months with report dates of March 31, June 30, September 30, and December 31. (2) The form and content of the report on the realization of the use of funds as referred to in paragraph (1) must be prepared in accordance with Format 5 as stated in the Annex which is an inseparable part of this Financial Services Authority Regulation.

Article 76
(1) Sharia Companies must meet gearing ratio provisions of a minimum of 0 (zero) times and a maximum of 10 (ten) times.
(2) The gearing ratio as referred to in paragraph (1) for Sharia Companies must be obtained from the comparison between the sum of:
a. funding as referred to in Article 66 paragraph (1) letter b; b. subordinated funding as referred to in Article 66 paragraph (1) letter c;
c. sukuk issued through a public offering;
d. sukuk issued not through a public offering as referred to in Article 66 paragraph (1) letter e; and e. funding to the Sharia Business Unit (UUS) from its parent Financing Company, with the difference between the sum of Equity and subordinated funding as referred to in Article 66 paragraph (1) letter c with participation. (3) Subordinated funding that can be counted as the divisor in the calculation of the gearing ratio as referred to in paragraph (2) is set at a maximum of 50% (fifty percent) of Paid-up Capital or working capital for the Sharia Business Unit (UUS).

Article 77
(1) Sharia Companies that receive funding in the form of:
a. funding as referred to in Article 66 paragraph (1) letter b; b. subordinated funding as referred to in Article 66 paragraph (1) letter c;
c. sukuk through a public offering; and
d. sukuk issued not through a public offering as referred to in Article 66 paragraph (1) letter e, in foreign currency must conduct a full hedge.
(2) Full hedge as referred to in paragraph (1) must be implemented for the principal of funding/financing, investment results/profit sharing, margin, remuneration, and/or payment period.

Article 78
Sharia Companies that will receive funding in the form of foreign currency as referred to in Article 77 paragraph (1) must meet the Financial Health Level with a minimum healthy condition.

CHAPTER XVI
PROHIBITIONS

Article 79
Sharia Companies are prohibited from:
a. directly collecting funds from the public in the form of current accounts, savings, deposits, and/or other forms equivalent to public fund collection; b. providing guarantees in any form for the fulfillment of third-party obligations;
c. providing funding or Sharia Financing using guarantees based on pledge law;
d. issuing promissory notes, except as a guarantee for funding to parties providing funding; and/or e. taking actions that cause or force other financial institutions under the supervision of the Financial Services Authority to violate statutory regulations; and/or f. taking actions that cause or force other financial institutions under the supervision of the Financial Services Authority to avoid statutory regulations.

Article 80
Sharia Companies are prohibited from using incorrect information in conducting their business activities that can harm the interests of Consumers, creditors, and stakeholders including the Financial Services Authority.

CHAPTER XVII
PRODUCTIVE ASSET RATIOS

Article 81
(1) Sharia Companies must have a ratio of Net Productive Asset Balance (Outstanding Principal) to total assets (financing to asset ratio) of at least 40% (forty percent) of total assets. (2) The Net Productive Asset Balance (Outstanding Principal) as referred to in paragraph (1) must be obtained by subtracting the Productive Asset Balance (Outstanding Principal) with the provision for write-off of productive assets that has been formed by the Sharia Company. (3) Sharia Companies must meet the provisions as referred to in paragraph (1) at the latest 3 (three) years since obtaining a business license or UUS license. (4) In the event that a Sharia Company increases Paid-up Capital or working capital to meet minimum Equity provisions, capital ratio, gearing ratio, and the comparison of Equity with Paid-up Capital or working capital, the Sharia Company is exempted from meeting the provisions as referred to in paragraph (1) for a maximum period of 1 (one) year since the date of the increase in Paid-up Capital or working capital is approved by the Financial Services Authority. (5) The productive asset ratio to total assets provisions as referred to in paragraph (1) do not apply to UUS in resolution.

Article 82
(1) Sharia Companies must set a target for the ratio of Net Productive Asset Balance (Outstanding Principal) to total funding received in the business plan.
(2) The target ratio of Net Productive Asset Balance (Outstanding Principal) to total funding received as referred to in paragraph (1) must be set realistically. (3) The realization of the achievement of the target ratio of Net Productive Asset Balance (Outstanding Principal) to total funding received as referred to in paragraph (1) is reported in monthly reports submitted to the Financial Services Authority.

Article 83
(1) Sharia Companies must have a ratio of Productive Asset Balance (Outstanding Principal) for productive business purposes compared to the total Productive Asset Balance (Outstanding Principal) before being reduced by the provision for write-off of productive assets that has been formed of at least 10% (ten percent). (2) For Sharia Companies that have obtained a business license or UUS license at the time this Financial Services Authority Regulation is promulgated, the achievement of the ratio as referred to in paragraph (1) must be done progressively, namely:
a. at least 5% (five percent) within a period of 3 (three) years since this Financial Services Authority Regulation is promulgated; and b. at least 10% (ten percent) within a period of 5 (five) years since this Financial Services Authority Regulation is promulgated. (3) For Sharia Companies that obtain a business license or UUS license after this Financial Services Authority Regulation is promulgated, the Sharia Company must meet the provisions as referred to in paragraph (1) at the latest 1 (one) year since obtaining a business license or UUS license.

CHAPTER XVIII
EQUITY

Article 84
(1) Sharia Financing Companies in the form of a legal entity:
a. limited liability companies must have Equity of at least Rp100,000,000,000.00 (one hundred billion rupiah); or b. cooperatives must have Equity of at least Rp50,000,000,000.00 (fifty billion rupiah). (2) UUS must have Equity of at least Rp25,000,000,000.00 (twenty-five billion rupiah). (3) For Sharia Financing Companies originating from the conversion and separation of UUS, the provisions as referred to in paragraph (1) begin to apply 5 (five) years since the company in question obtains a business license as a Sharia Financing Company.

Article 85
Sharia Companies must have a ratio of Equity to Paid-up Capital or working capital for UUS of at least 50% (fifty percent).

CHAPTER XIX
FINANCIAL HEALTH LEVEL

First Section
General

Article 86
(1) Sharia Companies must at all times meet the Financial Health Level requirements with a minimum healthy condition.
(2) The measurement of the Financial Health Level as referred to in paragraph (1) includes:
a. capital ratio; b. productive asset quality;
c. profitability; and
d. liquidity.
(3) The provisions regarding the Financial Health Level as referred to in paragraph (1) do not apply to UUS in resolution except for the productive asset quality component as referred to in paragraph (2) letter b.

Second Section
Capital Ratio

Article 87
(1) Sharia Companies must meet a capital ratio of at least 10% (ten percent).
(2) The capital ratio as referred to in paragraph (1) is a comparison between adjusted capital and adjusted assets.

Third Section
Productive Asset Quality

Paragraph 1
Assessment of Productive Asset Quality

Article 88
Sharia Companies must assess, monitor, and take necessary steps to maintain the quality of productive assets to remain good.

Article 89
(1) The assessment of productive asset quality as referred to in Article 88 is established as:
a. good; b. special attention;
c. less active;
d. doubtful; or e. non-performing.
(2) The assessment of productive asset quality as referred to in paragraph (1) is established based on the factors of the timeliness of principal payments, margins, investment results/profit sharing, and/or remuneration. (3) The assessment of productive asset quality as referred to in paragraph (1) is categorized as follows:
a. good if there is no delay in principal, margin, investment result/profit sharing, and/or remuneration payments or if there is a delay in principal, margin, investment result/profit sharing, and/or remuneration payments up to 10 (ten) calendar days; b. special attention if there is a delay in principal, margin, investment result/profit sharing, and/or remuneration payments that has exceeded 10 (ten) calendar days up to 90 (ninety) calendar days;
c. less active if there is a delay in principal, margin, investment result/profit sharing, and/or remuneration payments that has exceeded 90 (ninety) calendar days up to 120 (one hundred twenty) calendar days;
d. doubtful if there is a delay in principal, margin, investment result/profit sharing, and/or remuneration payments that has exceeded 120 (one hundred twenty) calendar days up to 180 (one hundred eighty) calendar days; or e. non-performing if there is a delay in principal, margin, investment result/profit sharing, and/or remuneration payments that has exceeded 180 (one hundred eighty) calendar days.

Article 90
(1) In addition to the factors of timeliness of principal, margin, investment result/profit sharing, and/or remuneration payments as referred to in Article 89 paragraph (2), the assessment of productive asset quality for productive businesses amounting to Rp5,000,000,000.00 (five billion rupiah) or more can also be established by considering factors:
a. the Consumer's ability to pay; b. the Consumer's financial performance; and
c. the Consumer's business prospects.
(2) The assessment of the Consumer's ability to pay as referred to in paragraph (1) letter a includes assessment of the following components:
a. availability and accuracy of Consumer financial information; b. completeness of Sharia Financing documentation;
c. compliance with the Sharia Financing Agreement;
d. suitability of the use of Sharia Financing funds; and e. fairness of the source of obligation payments.
(3) The assessment of the Consumer's financial performance as referred to in paragraph (1) letter b includes assessment of the following components:
a. profit acquisition; b. capital structure;
c. cash flow; and
d. sensitivity to market risk.
(4) The assessment of the Consumer's business prospects as referred to in paragraph (1) letter c includes assessment of the following components:
a. business growth potential; b. market conditions and the Consumer's position in competition;
c. management quality and labor issues;
d. support from the group or affiliate; and e. efforts made by the Consumer in maintaining the environment.
(5) In the event of a difference between the assessment of productive asset quality by the Sharia Company and the Financial Services Authority, the productive asset quality established by the Financial Services Authority applies. (6) Sharia Companies must adjust the quality of productive assets in accordance with the assessment of productive asset quality established by the Financial Services Authority as referred to in paragraph (5) in reports submitted to the Financial Services Authority.

Paragraph 2
Productive Asset Quality for Consumers with More Than One Sharia Financing Agreement

Article 91
(1) Sharia Companies must establish the same productive asset quality for 1 (one) Consumer with more than 1 (one) Sharia Financing Agreement.
(2) In establishing the same productive asset quality for 1 (one) Consumer with more than 1 (one) Sharia Financing Agreement as referred to in paragraph (1), the Sharia Company must use the lowest productive asset quality. (3) Sharia Companies may establish different productive asset qualities for more than 1 (one) Sharia Financing Agreement owned by 1 (one) Consumer as referred to in paragraph (1), in the event:
a. the productive asset with the lowest quality has been written off; and/or b. the Productive Asset Balance (Outstanding Principal) of the Sharia Financing Agreement is up to Rp5,000,000,000.00 (five billion rupiah).

Paragraph 3
Problematic Productive Assets

Article 92
(1) Sharia Companies must maintain the quality of productive assets.
(2) Productive assets categorized as problematic productive assets consist of productive assets with quality less active, doubtful, and/or non-performing.
(3) Sharia Companies must at all times maintain the ratio of productive assets with the category of problematic productive asset quality as referred to in paragraph (2) after being reduced by the provision for write-off of productive assets that has been formed by the Sharia Company for productive assets with quality less active, doubtful, and non-performing compared to the total Productive Asset Balance (Outstanding Principal) of at most 5% (five percent).

Article 93
Sharia Companies may restructure productive assets.

Paragraph 4
Provision for Write-off of Productive Assets

Article 94
(1) Sharia Companies must calculate the provision for write-off of productive assets.
(2) The calculation of the provision for write-off of productive assets as referred to in paragraph (1) is established at a minimum of:
a. 1% (one percent) of the Productive Asset Balance (Outstanding Principal) with good quality after being reduced by collateral; b. 5% (five percent) of the Productive Asset Balance (Outstanding Principal) with special attention quality after being reduced by collateral;
c. 15% (fifteen percent) of the Productive Asset Balance (Outstanding Principal) with less active quality after being reduced by collateral;
d. 50% (fifty percent) of the Productive Asset Balance (Outstanding Principal) with doubtful quality after being reduced by collateral; and e. 100% (one hundred percent) of the Productive Asset Balance (Outstanding Principal) with non-performing quality after being reduced by collateral. (3) Sharia Companies must form a provision for write-off of productive assets of at least in accordance with the provisions as referred to in paragraph (2) in monthly reports. (4) The value of collateral as referred to in paragraph (2) that can be counted as a reduction to the Productive Asset Balance (Outstanding Principal) is established at a maximum equal to the value of its productive asset balance.

Paragraph 5
Provision for Impairment Loss of Productive Assets

Article 95
(1) Sharia Companies must form a provision for impairment loss of productive assets in accordance with applicable financial accounting standards.
(2) The formation of the provision for impairment loss of productive assets as referred to in paragraph (1) is conducted in the preparation of financial reports that have been audited by a public accounting firm.

Fourth Section
Profitability

Article 96
(1) Profitability as referred to in Article 86 paragraph (2) letter c is the ability of the Sharia Company to generate profit.
(2) The assessment of the profitability factor as referred to in paragraph (1) includes assessment of asset performance and operational efficiency.

Fifth Section
Liquidity

Article 97
The assessment of the liquidity factor as referred to in Article 86 paragraph (2) letter d is an assessment of the level of compatibility between current assets and current liabilities.

CHAPTER XX
SHARIA COMPANIES IN THE ELECTRICITY AND SHIPPING SECTORS

Article 98
(1) Sharia Companies established specifically to conduct Sharia Financing activities in the electricity sector may conduct business activities other than those referred to in Article 4. (2) Other business activities as referred to in paragraph (1) are only conducted to support the fulfillment of national electricity needs. (3) Sharia Companies as referred to in paragraph (1) are exempted from the obligation to meet the provisions as referred to in Article 76 paragraph (1), Article 81 paragraph (1), and Article 87 paragraph (1).

Article 99
Sharia Companies that specifically conduct Sharia Financing activities in the shipping sector are exempted from the obligation to meet the provisions as referred to in Article 65 paragraph (2) and paragraph (3).

CHAPTER XXI
SUBMISSION OF PERIODIC REPORTS

Article 100
(1) Sharia Companies must submit periodic reports to the Financial Services Authority, namely:
a. monthly reports; and b. annual financial reports audited by a public accountant.
(2) Provisions regarding monthly reports as referred to in paragraph (1) letter a are regulated in a Financial Services Authority Regulation regarding monthly reports.

Article 101
(1) Sharia Financing Companies must submit annual financial reports audited by a public accountant as referred to in Article 100 paragraph (1) letter b to the Financial Services Authority at the latest 4 (four) months after the last fiscal year. (2) Sharia Financing Companies must submit annual financial reports audited by a public accountant as referred to in Article 100 paragraph (1) letter b completely and correctly in hard copy and soft copy form. (3) If the deadline for submission of annual financial reports as referred to in paragraph (1) falls on a holiday, the submission deadline is the next working day.

Article 102
(1) Annual financial reports audited as referred to in Article 100 paragraph (1) letter b must be prepared based on applicable financial accounting standards in Indonesia. (2) Annual financial reports as referred to in Article 100 paragraph (1) letter b must include calculations of matters specifically regulated in this Financial Services Authority Regulation. (3) Annual financial reports audited by a public accountant as referred to in Article 100 paragraph (1) letter b must be prepared in Indonesian Rupiah. (4) The fiscal year as referred to in Article 101 paragraph (1) must be based on the calendar year. (5) The public accountant as referred to in Article 101 paragraph (2) must be registered with the Financial Services Authority. (6) If a Sharia Financing Company obtains a business license for less than 6 (six) months until the end of the calendar year, the obligation to submit annual financial reports as referred to in Article 100 paragraph (1) letter b begins to apply in the following calendar year.

Article 103
(1) Sharia Financing Companies must announce the financial position report and a brief comprehensive income statement at the latest 4 (four) months after the end of the fiscal year at least in 1 (one) daily newspaper in Indonesia with national circulation. (2) Sharia Financing Companies must report the implementation of the announcement as referred to in paragraph (1) in writing to the Financial Services Authority at the latest 20 (twenty) calendar days since the implementation of the announcement, attached with proof of announcement. (3) If the deadline for submission of the report on the implementation of the announcement as referred to in paragraph (2) falls on a holiday, the submission deadline is the next working day.

CHAPTER XXII
OTHER PROVISIONS

Article 104
(1) Professional Certification Institutions must be registered with the Financial Services Authority.
(2) To be registered with the Financial Services Authority, the Professional Certification Institution as referred to in paragraph (1) must submit an application to the Financial Services Authority accompanied by:

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a. proof of a valid license from a Professional Certification Institution from another institution designated based on applicable regulations; b. photocopy of the Articles of Association of the Professional Certification Institution;
c. the certification scheme of the Professional Certification Institution;
d. standard operating procedures for the implementation of certification; and e. the organizational structure of the Professional Certification Institution and the composition of its management.

Article 105
In the event that the Financial Services Authority has provided an electronic service system (e-licensing), requests for approval and/or reporting as referred to in Article 7, Article 8, Article 9 paragraph (3), Article 61 paragraph (1), Article 70 paragraph (1), Article 73 paragraph (1), Article 75 paragraph (1), Article 100 paragraph (1), and Article 103 paragraph (2) shall be submitted to the Financial Services Authority online through the Financial Services Authority's data communication network system.

Article 106
Further provisions regarding the management of Sharia business, including but not limited to Sharia contracts, the use of contracts, reporting on the use of contracts, approval of the use of contracts, cessation of the use of contracts, procedures for measuring Financial Health Levels, procedures for calculating capital adequacy ratios, guidelines for assessing the quality of productive assets, restructuring of productive assets, types, procedures for calculation, return of collateral, and procedures for calculating reserves, procedures for assessing profitability factors, procedures for assessing liquidity, and/or electronic services (e-licensing), shall be regulated in a Circular Letter of the Financial Services Authority.

CHAPTER XXIII
COMPLIANCE ENFORCEMENT
First Section
Notification

Article 107
(1) Sharia Financing Companies and/or Financing Companies that have Sharia Business Units which do not meet the provisions as referred to in Article 2, Article 5 paragraph (4), Article 7, Article 9 paragraph (3), Article 11, Article 12 paragraph (1), Article 18 paragraph (5), Article 22 paragraph (1), Article 23 paragraph (1), Article 28, Article 31, Article 32, Article 33, Article 37 paragraph (1), Article 77, Article 78, Article 83, Article 100 paragraph (1), Article 101 paragraph (1) and paragraph (2), Article 102 paragraph (1), paragraph (2), paragraph (3), paragraph (4), and paragraph (5), and/or Article 103 paragraph (1) and paragraph (2) of this Financial Services Authority Regulation shall be issued a notification letter. (2) Sharia Financing Companies and/or Financing Companies that have Sharia Business Units are required to fulfill the provisions as referred to in paragraph (1) within a maximum of 1 (one) month from the date of the notification letter.

Second Section
Compliance Plan

Article 108
(1) Sharia Financing Companies and/or Financing Companies that have Sharia Business Units which do not meet the provisions as referred to in Article 13 paragraph (1), Article 18 paragraph (1), Article 19 paragraph (1) and paragraph (2), Article 21 paragraph (1), Article 62, Article 81 paragraph (1) and paragraph (3), Article 84 paragraph (1) and paragraph (2), Article 85, Article 86 paragraph (1), Article 87 paragraph (1), Article 88, Article 92 paragraph (1) and paragraph (3), Article 94 paragraph (1) and paragraph (3), and/or Article 95 paragraph (1) of this Financial Services Authority Regulation are required to submit a compliance plan within a maximum of 1 (one) month from the date of the determination of the violation by the Financial Services Authority. (2) The compliance plan as referred to in paragraph (1) must at least contain the plan to be carried out by the Sharia Financing Company and/or Financing Company that has a Sharia Business Unit, accompanied by a specific time frame required to fulfill the provisions as referred to in paragraph (1). (3) The compliance plan as referred to in paragraph (1) must contain:
a. restructuring of assets and/or liabilities; b. restriction on receiving new funding;
c. receipt of subordinated funding;
d. transfer of part or all of the assets; e. restriction on profit distribution; f. restriction on activities that cause violations of regulations; g. restriction on opening new branch offices; h. addition of Paid-up Capital or working capital;
i. merger of business entities; and/or
j. other actions.
(4) The time frame for the compliance plan involving actions as referred to in paragraph (3) letters a through g is limited to a maximum of 1 (one) year.
(5) The time frame for the compliance plan involving actions as referred to in paragraph (3) letters h and i is limited to a maximum of 2 (two) years.
(6) The time frame for the compliance plan involving actions other than those referred to in paragraph (3) letter j is limited to a maximum of 1 (one) year.

Article 109
(1) The compliance plan as referred to in Article 108 paragraph (1) must be signed by all Directors and the Board of Commissioners.
(2) The compliance plan as referred to in Article 108 paragraph (1) must first be approved by the General Meeting of Shareholders in the event that the plan contains a plan for the addition of Paid-up Capital or working capital, or a plan for the merger of business and/or legal entities. (3) The compliance plan as referred to in Article 108 paragraph (1) must obtain a statement of non-objection from the Financial Services Authority. (4) The Financial Services Authority submits requests for improvement, rejection, or a statement of non-objection regarding the compliance plan submitted by the Sharia Financing Company and/or Financing Company that has a Sharia Business Unit as referred to in Article 108 paragraph (1) within a maximum of 14 (fourteen) working days from the date the compliance plan is received. (5) The Financial Services Authority submits a request for improvement of the compliance plan in the event that the compliance plan is assessed as able to resolve the regulatory issues that have not yet been fulfilled by the Sharia Financing Company and/or Financing Company that has a Sharia Business Unit, but the compliance plan still requires improvement. (6) The Sharia Financing Company and/or Financing Company that has a Sharia Business Unit is required to submit the improved compliance plan in accordance with the request of the Financial Services Authority as referred to in paragraph (5) within a maximum of 14 (fourteen) working days from the date of the request letter for improvement of the compliance plan from the Financial Services Authority. (7) In the event that the Sharia Financing Company and/or Financing Company that has a Sharia Business Unit has submitted the improved compliance plan in accordance with the request of the Financial Services Authority, the Financial Services Authority provides a statement of non-objection or rejection in accordance with the provisions as referred to in paragraph (4). (8) The Financial Services Authority submits a rejection regarding the compliance plan in the event that the compliance plan is assessed as unable to resolve the regulatory issues that have not yet been fulfilled by the Sharia Financing Company and/or Financing Company that has a Sharia Business Unit. (9) The Financial Services Authority provides a statement of non-objection regarding the compliance plan in the event that the compliance plan is assessed as able to resolve the regulatory issues that have not yet been fulfilled by the Sharia Financing Company and/or Financing Company that has a Sharia Business Unit. (10) If within the time frame as referred to in paragraph (4), the Financial Services Authority does not submit a request for improvement, rejection, or statement of non-objection, the Sharia Financing Company and/or Financing Company that has a Sharia Business Unit may implement the compliance plan. (11) The Sharia Financing Company and/or Financing Company that has a Sharia Business Unit is required to implement the
compliance plan that has obtained a statement of non-objection from the Financial Services Authority as referred to in paragraph (9) or the compliance plan as referred to in paragraph (10).

CHAPTER XXIV
ADMINISTRATIVE SANCTIONS

Article 110
(1) In the event that by the end of the time frame for the notification letter as referred to in Article 107 paragraph (2), the Sharia Financing Company and/or Financing Company that has a Sharia Business Unit has not yet fulfilled the provisions as referred to in Article 107 paragraph (1), the Sharia Financing Company and/or Financing Company that has a Sharia Business Unit shall be subject to graduated administrative sanctions in the form of:
a. warning; b. suspension of business activities for Sharia Financing Companies;
c. suspension of Sharia Business Unit activities for Financing Companies that have Sharia Business Units;
d. revocation of business licenses for Sharia Financing Companies; and/or e. revocation of Sharia Business Unit licenses for Financing Companies that have Sharia Business Units. (2) In addition to the administrative sanctions as referred to in paragraph (1), the Financial Services Authority may:
a. impose restrictions on certain business activities; b. reduce the results of risk level assessments;
c. cancel approvals; and/or
d. reassess the competence and integrity of the principal parties of the Sharia Financing Company and/or Financing Company that has a Sharia Business Unit.
(3) Sharia Financing Companies and/or Financing Companies that have Sharia Business Units that violate the provisions as referred to in paragraph (1) but the violation has been resolved, shall still be subject to administrative sanctions in the form of a first warning that ends automatically. (4) Administrative sanctions in the form of warnings as referred to in paragraph (1) letter a, may be issued in writing for a maximum of 3 (three) consecutive times with each validity period of a maximum of 2 (two) months. (5) In the event that before the end of the time frame for the administrative sanction in the form of a warning as referred to in paragraph (4), the Sharia Financing Company and/or Financing Company that has a Sharia Business Unit has fulfilled the provisions as referred to in Article 107 paragraph (1), the Financial Services Authority revokes the administrative sanction in the form of a warning. (6) In the event that the validity period of the third warning as referred to in paragraph (4) ends and the Sharia Financing Company and/or Financing Company that has a Sharia Business Unit still does not fulfill the provisions as referred to in Article 107 paragraph (1), the Financial Services Authority imposes administrative sanctions in the form of:
a. suspension of business activities for Sharia Financing Companies; or b. suspension of Sharia Business Unit activities for Financing Companies that have Sharia Business Units. (7) Administrative sanctions in the form of suspension of business activities as referred to in paragraph (6) are issued in writing and are valid from the date of determination for a maximum period of 6 (six) months from:
a. the date the administrative sanction letter in the form of suspension of business activities is issued for Sharia Financing Companies; or b. the date the administrative sanction letter in the form of suspension of Sharia Business Unit activities is issued for Financing Companies that have Sharia Business Units. (8) If the validity period of the administrative sanction in the form of warning and/or suspension of business activities ends on a holiday, the administrative sanction in the form of warning and/or suspension of business activities shall be valid until the first working day thereafter. (9) Sharia Financing Companies and/or Financing Companies that have Sharia Business Units subject to administrative sanctions in the form of suspension of business activities as referred to in paragraph (6) are prohibited from conducting business activities. (10) In the event that before the end of the time frame for the suspension of business activities as referred to in paragraph (7), the Sharia Financing Company and/or Financing Company that has a Sharia Business Unit has fulfilled the provisions as referred to in Article 107 paragraph (1), the Financial Services Authority revokes the administrative sanction in the form of:
a. suspension of business activities for Sharia Financing Companies; or b. suspension of Sharia Business Unit activities for Financing Companies that have Sharia Business Units. (11) In the event that the administrative sanction in the form of suspension of business activities is still in effect and the Sharia Financing Company and/or Financing Company that has a Sharia Business Unit continues to conduct financing business activities, the Financial Services Authority may directly impose administrative sanctions in the form of:
a. revocation of business licenses for Sharia Financing Companies; or b. revocation of Sharia Business Unit licenses for Financing Companies that have Sharia Business Units. (12) In the event that by the end of the time frame for the suspension of business activities as referred to in paragraph (7), the Sharia Financing Company and/or Financing Company that has a Sharia Business Unit has not yet fulfilled the provisions as referred to in Article 107 paragraph (1), the Financial Services Authority imposes administrative sanctions in the form of:
a. revocation of business licenses for Sharia Financing Companies; or b. revocation of Sharia Business Unit licenses for Financing Companies that have Sharia Business Units. (13) The Financial Services Authority may announce administrative sanctions in the form of:
a. suspension of business activities as referred to in paragraph (1) letter b; b. suspension of Sharia Business Unit activities as referred to in paragraph (1) letter c;
c. revocation of business licenses as referred to in paragraph (1) letter d; and/or
d. revocation of Sharia Business Unit licenses as referred to in paragraph (1) letter e, to the public.

Article 111
(1) Sharia Financing Companies and Financing Companies that have Sharia Business Units that:
a. violate the provisions as referred to in Article 108 paragraph (1) and/or Article 109 paragraph (6) and paragraph (11); b. have their compliance plans rejected by the Financial Services Authority as referred to in Article 109 paragraph (8); and/or
c. have not fulfilled the provisions as referred to in Article 13 paragraph (1), Article 18 paragraph (1), Article 19 paragraph (1) and paragraph (2), Article 21 paragraph (1), Article 62, Article 81 paragraph (1) and paragraph (3), Article 84 paragraph (1) and paragraph (2), Article 85, Article 86 paragraph (1), Article 87 paragraph (1), Article 88, Article 92 paragraph (1) and paragraph (3), Article 94 paragraph (1) and paragraph (3), and/or Article 95 paragraph (1) within the time frame established in the compliance plan as referred to in Article 108 paragraph (4) through paragraph (6),
shall be subject to administrative sanctions.
(2) Administrative sanctions as referred to in paragraph (1) are imposed in a graduated manner in the form of:
a. warning; b. suspension of business activities for Sharia Financing Companies;
c. suspension of Sharia Business Unit activities for Financing Companies that have Sharia Business Units;
d. revocation of business licenses for Sharia Financing Companies; and/or e. revocation of Sharia Business Unit licenses for Financing Companies that have Sharia Business Units. (3) In addition to the administrative sanctions as referred to in paragraph (2), the Financial Services Authority may:
a. impose restrictions on certain business activities; b. reduce the results of risk level assessments;
c. cancel approvals; and/or
d. reassess the competence and integrity of the principal parties of the Sharia Financing Company and/or Financing Company that has a Sharia Business Unit.
(4) Sharia Financing Companies and/or Financing Companies that have Sharia Business Units that violate the provisions as referred to in paragraph (1) but the violation has been resolved, shall still be subject to administrative sanctions in the form of a first warning that ends automatically. (5) Administrative sanctions in the form of warnings as referred to in paragraph (2) letter a, may be issued in writing for a maximum of 3 (three) consecutive times with each validity period of a maximum of 2 (two) months. (6) In the event that before the end of the time frame for the administrative sanction in the form of a warning as referred to in paragraph (5), the Sharia Financing Company and/or Financing Company that has a Sharia Business Unit has fulfilled the provisions as referred to in Article 13 paragraph (1), Article 18 paragraph (1), Article 19 paragraph (1) and paragraph (2), Article 21 paragraph (1), Article 62, Article 81 paragraph (1) and paragraph (3), Article 84 paragraph (1) and paragraph (2), Article 85, Article 86 paragraph (1), Article 87 paragraph (1), Article 88, Article 92 paragraph (1) and paragraph (3), Article 94 paragraph (1) and paragraph (3), Article 95 paragraph (1), Article 108 paragraph (1), and/or Article 109 paragraph (6) and paragraph (11), the Financial Services Authority revokes the administrative sanction in the form of a warning. (7) In the event that the validity period of the third warning as referred to in paragraph (5) ends and the Sharia Financing Company and/or Financing Company that has a Sharia Business Unit still does not fulfill the provisions as referred to in Article 13 paragraph (1), Article 18 paragraph (1), Article 19 paragraph (1) and paragraph (2), Article 21 paragraph (1), Article 62, Article 81 paragraph (1) and paragraph (3), Article 84 paragraph (1) and paragraph (2), Article 85, Article 86 paragraph (1), Article 87 paragraph (1), Article 88, Article 92 paragraph (1) and paragraph (3), Article 94 paragraph (1) and paragraph (3), and/or Article 95 paragraph (1), the Financial Services Authority imposes administrative sanctions in the form of:
a. suspension of business activities for Sharia Financing Companies; or b. suspension of Sharia Business Unit activities for Financing Companies that have Sharia Business Units. (8) In the event that the validity period of the third warning as referred to in paragraph (5) ends and the Sharia Financing Company and Financing Company that has a Sharia Business Unit still does not fulfill the provisions as referred to in Article 81 paragraph (1) and paragraph (3), Article 108 paragraph (1), and/or Article 109 paragraph (6) and paragraph (11), the Financial Services Authority imposes administrative sanctions in the form of:
a. revocation of business licenses for Sharia Financing Companies; or b. revocation of Sharia Business Unit licenses for Financing Companies that have Sharia Business Units, without prior administrative sanctions in the form of suspension of business activities or suspension of Sharia Business Unit activities. (9) Administrative sanctions in the form of suspension of business activities as referred to in paragraph (2) letters b and c are issued in writing and are valid from the date of determination for a maximum period of 6 (six) months. (10) If the validity period of the administrative sanction in the form of warning as referred to in paragraph (2) letter a, suspension of business activities as referred to in paragraph (2) letter b, and/or suspension of Sharia Business Unit activities as referred to in paragraph (2) letter c ends on a holiday, the administrative sanctions in the form of warning, suspension of business activities, and/or suspension of Sharia Business Unit activities shall be valid until the first working day thereafter. (11) Sharia Financing Companies and/or Financing Companies that have Sharia Business Units subject to administrative sanctions in the form of suspension of business activities and/or suspension of Sharia Business Unit activities as referred to in paragraph (7) are prohibited from conducting business activities or Sharia Business Unit activities. (12) In the event that before the end of the time frame for the suspension of business activities as referred to in paragraph (9), the Sharia Financing Company and/or Financing Company that has a Sharia Business Unit has fulfilled the provisions as referred to in paragraph (1), the Financial Services Authority revokes the administrative sanction in the form of:
a. suspension of business activities for Sharia Financing Companies; or b. suspension of Sharia Business Unit activities for Financing Companies that have Sharia Business Units. (13) In the event that the administrative sanction in the form of suspension of business activities and/or suspension of Sharia Business Unit activities is still in effect and the Sharia Financing Company and/or Financing Company that has a Sharia Business Unit continues to conduct business activities, the Financial Services Authority may directly impose administrative sanctions in the form of:
a. revocation of business licenses for Sharia Financing Companies; or b. revocation of Sharia Business Unit licenses for Financing Companies that have Sharia Business Units. (14) In the event that by the end of the time frame for the suspension of business activities or Sharia Business Unit activities as referred to in paragraph (9), the Sharia Financing Company and Financing Company that has a Sharia Business Unit has not yet fulfilled the provisions as referred to in Article 13 paragraph (1), Article 18 paragraph (1), Article 19 paragraph (1) and paragraph (2), Article 21 paragraph (1), Article 62, Article 81 paragraph (1) and paragraph (3), Article 84 paragraph (1) and paragraph (2), Article 85, Article 86 paragraph (1), Article 87 paragraph (1), Article 88, Article 92 paragraph (1) and paragraph (3), Article 94 paragraph (1) and paragraph (3), Article 95 paragraph (1), the Financial Services Authority revokes:
a. business licenses for Sharia Financing Companies; or b. Sharia Business Unit licenses for Financing Companies that have Sharia Business Units.
(15) The Financial Services Authority may announce administrative sanctions in the form of:
a. suspension of business activities as referred to in paragraph (2) letter b; b. suspension of Sharia Business Unit activities as referred to in paragraph (2) letter c;
c. revocation of business licenses as referred to in paragraph (2) letter d; and/or
d. revocation of Sharia Business Unit licenses as referred to in paragraph (2) letter e, to the public.

Article 112
(1) Sharia Financing Companies and/or Financing Companies that have Sharia Business Units that violate the provisions as referred to in Article 3 paragraph (1) and paragraph (3), Article 8, Article 10 paragraph (5), Article 12 paragraph (2), paragraph (4), and paragraph (5), Article 14 paragraph (2), Article 15 paragraph (2), paragraph (3), paragraph (4), and paragraph (5), Article 17 paragraph (1), Article 24, Article 25 paragraph (1), Article 26, Article 27, Article 29, Article 34, Article 35, Article 36 paragraph (2), paragraph (3), and paragraph (5), Article 37 paragraph (4), Article 38 paragraph (1) and paragraph (3), Article 39, Article 40, Article 41 paragraph (1), Article 42, Article 43, Article 44, Article 45 paragraph (2), paragraph (3), paragraph (4), and paragraph (5), Article 46 paragraph (1) and paragraph (3), Article 47, Article 48 paragraph (1), Article 49, Article 50 paragraph (1), Article 52 paragraph (1), Article 53 paragraph (1), Article 54 paragraph (1), Article 55 paragraph (1), Article 56, Article 61 paragraph (1), Article 63 paragraph (1), Article 64, Article 65, Article 66 paragraph (1), paragraph (3), and paragraph (4), Article 67, Article 69, Article 70 paragraph (1), Article 72, Article 73 paragraph (1), Article 74, Article 75 paragraph (1), Article 76 paragraph (1), Article 79, Article 80, Article 82 paragraph (1) and paragraph (2), Article 90 paragraph (6), and/or Article 91 paragraph (1) and paragraph (2) of this Financial Services Authority Regulation shall be subject to graduated administrative sanctions in the form of:
a. warning; b. suspension of business activities for Sharia Financing Companies;
c. suspension of Sharia Business Unit activities for Financing Companies that have Sharia Business Units;
d. revocation of business licenses for Sharia Financing Companies; and/or e. revocation of Sharia Business Unit licenses for Financing Companies that have Sharia Business Units. (2) In addition to the administrative sanctions as referred to in paragraph (1), the Financial Services Authority may:
a. impose restrictions on certain business activities; b. reduce the results of risk level assessments;
c. cancel approvals; and/or
d. reassess the competence and integrity of the principal parties of the Sharia Financing Company and/or Financing Company that has a Sharia Business Unit.
(3) Sharia Financing Companies and/or Financing Companies that have Sharia Business Units that violate the provisions as referred to in paragraph (1) but the violation has been resolved, shall still be subject to administrative sanctions in the form of a first warning that ends automatically. (4) Administrative sanctions in the form of warnings as referred to in paragraph (1) letter a, may be issued in writing for a maximum of 3 (three) consecutive times with each validity period of a maximum of 2 (two) months. (5) In the event that before the end of the time frame for the administrative sanction in the form of a warning as referred to in paragraph (4), the Sharia Financing Company and/or Financing Company that has a Sharia Business Unit has fulfilled the provisions as referred to in paragraph

(1), The Financial Services Authority revokes administrative sanctions in the form of warnings.
(6) In the event that the validity period of the third warning as referred to in paragraph (4) expires and the Sharia Financing Company and/or the Financing Company having a Sharia Business Unit (UUS) still does not meet the provisions as referred to in paragraph (1), the Financial Services Authority imposes administrative sanctions in the form of:
a. suspension of business activities for the Sharia Financing Company; or b. suspension of business activities of the UUS for the Financing Company having a UUS. (7) Administrative sanctions in the form of business suspension as referred to in paragraph (6) are issued in writing and take effect from the date established for a maximum period of 6 (six) months. (8) If the validity period of administrative sanctions in the form of warnings, business suspension, or UUS business suspension expires on a holiday, the administrative sanctions in the form of warnings, business suspension, and/or UUS business suspension remain valid until the first working day following. (9) Sharia Financing Companies and/or Financing Companies having a UUS subject to administrative sanctions in the form of business suspension or UUS business suspension as referred to in paragraph (6) are prohibited from conducting business activities or UUS business activities. (10) In the event that before the expiration of the business suspension period or UUS business suspension period as referred to in paragraph (7), the Sharia Financing Company and/or the Financing Company having a UUS has met the provisions as referred to in paragraph (1), the Financial Services Authority revokes administrative sanctions in the form of:
a. suspension of business activities for the Sharia Financing Company; or b. suspension of business activities of the UUS for the Financing Company having a UUS. (11) In the event that administrative sanctions in the form of business suspension or UUS business suspension are still in effect and the Sharia Financing Company and Financing Company having a UUS continue to conduct business activities, the Financial Services Authority may directly impose administrative sanctions in the form of:
a. revocation of business licenses for the Sharia Financing Company; or b. revocation of UUS licenses for the Financing Company having a UUS.
(12) In the event that by the expiration of the business suspension period or UUS business suspension period as referred to in paragraph (7), the Sharia Financing Company and/or the Financing Company having a UUS still does not meet the provisions as referred to in paragraph (1), the Financial Services Authority imposes administrative sanctions in the form of:
a. revocation of business licenses for the Sharia Financing Company; or b. revocation of UUS licenses for the Financing Company having a UUS.
(13) The Financial Services Authority may announce administrative sanctions in the form of:
a. business suspension as referred to in paragraph (1) letter b; b. UUS business suspension as referred to in paragraph (1) letter c;
c. business license revocation as referred to in paragraph (1) letter d; and/or
d. UUS license revocation as referred to in paragraph (1) letter e, to the public.

Article 113
(1) The Financial Services Authority may impose administrative sanctions in the form of:
a. suspension of business activities for the Sharia Financing Company; or b. suspension of business activities of the UUS for the Financing Company having a UUS, without prior imposition of administrative sanctions in the form of warnings in the event that Sharia Financing Companies and Financing Companies having a UUS commit violations of Article 79 letter a and Article 80. (2) Administrative sanctions in the form of business suspension or UUS business suspension as referred to in paragraph (1) are issued in writing and take effect from the date established for a maximum period of 6 (six) months. (3) If the validity period of administrative sanctions in the form of business suspension or UUS business suspension expires on a holiday, administrative sanctions in the form of business suspension remain valid until the first working day following. (4) Sharia Financing Companies and Financing Companies having a UUS subject to administrative sanctions in the form of business suspension or UUS business suspension as referred to in paragraph (1) are prohibited from conducting business activities or UUS business activities. (5) In the event that before the expiration of the business suspension period or UUS business suspension period as referred to in paragraph (2), the Sharia Financing Company and Financing Company having a UUS has met the provisions as referred to in paragraph (1), the Financial Services Authority revokes administrative sanctions in the form of:
a. suspension of business activities for the Sharia Financing Company; or b. suspension of business activities of the UUS for the Financing Company having a UUS. (6) In the event that administrative sanctions in the form of business suspension or UUS business suspension are still in effect and the Sharia Financing Company and Financing Company having a UUS continue to conduct business activities, the Financial Services Authority may directly impose administrative sanctions in the form of:
a. revocation of business licenses for the Sharia Financing Company; or b. revocation of UUS licenses for the Financing Company having a UUS.
(7) In the event that by the expiration of the business suspension period or UUS business suspension period as referred to in paragraph (2), the Sharia Financing Company and Financing Company having a UUS still does not meet the provisions as referred to in paragraph (1), the Financial Services Authority imposes administrative sanctions in the form of:
a. revocation of business licenses for the Sharia Financing Company; or b. revocation of UUS licenses for the Financing Company having a UUS.
(8) The Financial Services Authority may announce administrative sanctions in the form of:
a. business suspension as referred to in paragraph (1) letter a; b. UUS business suspension as referred to in paragraph (1) letter b;
c. business license revocation as referred to in paragraph (6) letter a and paragraph (7) letter a; and/or
d. UUS license revocation as referred to in paragraph (6) letter b and paragraph (7) letter b, to the public.

CHAPTER XXV
TRANSITIONAL PROVISIONS
Article 114
(1) For Sharia Companies that have obtained business licenses and UUS licenses before this Financial Services Authority Regulation is promulgated, the provisions regarding the contents of Sharia Financing agreements as referred to in Article 31 paragraph (1) letters n through r are declared valid for 6 (six) months from the date this Financial Services Authority Regulation is promulgated. (2) For Sharia Companies that have obtained business licenses and UUS licenses before this Financial Services Authority Regulation is promulgated, the obligation to store and maintain documents evidencing ownership of financing collateral at the head office and/or branch offices of the Sharia Company as referred to in Article 40 paragraph (1) and Article 41 paragraph (1) are declared valid for 1 (one) year from the date this Financial Services Authority Regulation is promulgated. (3) For Sharia Companies that have obtained business licenses and UUS licenses before this Financial Services Authority Regulation is promulgated, the obligation to implement fraud control as referred to in Article 50 paragraph (1) is declared valid for 1 (one) year from the date this Financial Services Authority Regulation is promulgated. (4) For Sharia Companies that have obtained business licenses before this Financial Services Authority Regulation is promulgated, the provisions regarding the obligation to establish units or functions responsible for handling fraud control in the organization of the Financing Company as referred to in Article 52 paragraph (1) are declared valid for 6 (six) months from the date this Financial Services Authority Regulation is promulgated. (5) Certificates in the fields of Sharia financing, debt collection, and risk management as referred to in Article 62, which have been obtained from institutions designated by associations before this Financial Services Authority Regulation is promulgated, are declared valid and effective. (6) Institutions that have conducted certification in the fields of Sharia financing, debt collection, and risk management as referred to in paragraph (5) must meet the provisions as Certification Institutions for Professions no later than 3 (three) years from the date this Financial Services Authority Regulation is promulgated.
Article 115
(1) Every notification letter, which has been issued to Sharia Financing Companies and Financing Companies having a UUS based on Financial Services Authority Regulation Number 31/POJK.05/2014 concerning the Management of Sharia Financing Business, is declared valid and effective. (2) Every fulfillment plan that has received a statement of no objection from the Financial Services Authority based on Financial Services Authority Regulation Number 31/POJK.05/2014 concerning the Management of Sharia Financing Business is declared valid and effective. (3) Every administrative sanction that has been imposed on Sharia Financing Companies and Financing Companies having a UUS based on Financial Services Authority Regulation Number 31/POJK.05/2014 concerning the Management of Sharia Financing Business is declared valid and effective. (4) Sharia Financing Companies and Financing Companies having a UUS that have not yet been able to overcome the causes of the imposition of administrative sanctions as referred to in paragraph (3) are subject to continued administrative sanctions in accordance with this Financial Services Authority Regulation.

CHAPTER XXVI
CLOSING PROVISIONS
Article 116
At the time this Financial Services Authority Regulation takes effect, provisions concerning the management of Sharia Company business are subject to this Financial Services Authority Regulation.
Article 117
At the time this Financial Services Authority Regulation takes effect, a. Financial Services Authority Regulation Number 31/POJK.05/2014 concerning the Management of Sharia Financing Business (State Gazette of the Republic of Indonesia Year 2014 Number 366, Supplement to the State Gazette of the Republic of Indonesia Number 5640) is revoked and declared invalid; b. Circular Letter of the Financial Services Authority Number 48/SEOJK.05/2016 concerning the Amount of Down Payment (Down Payment/Urbun) for Motor Vehicle Financing for Sharia Financing is revoked and declared invalid;
c. Section V number 2 letter c number 4) through 8) of the Circular Letter of the Financial Services Authority Number 2/SEOJK.05/2016 concerning the Financial Health Level of Sharia Financing is revoked and declared invalid; and
d. all implementing regulations of Financial Services Authority Regulation Number 31/POJK.05/2014 concerning the Management of Sharia Financing Business (State Gazette of the Republic of Indonesia Year 2014 Number 366, Supplement to the State Gazette of the Republic of Indonesia Number 5640) are declared still valid insofar as they do not conflict with the provisions in this Financial Services Authority Regulation.

This copy is consistent with the original
Legal Director 1
Legal Department signed
Yuliana
Article 118
This Financial Services Authority Regulation takes effect on the date of promulgation.
To be known by everyone, ordering the promulgation of this Financial Services Authority Regulation by placing it in the State Gazette of the Republic of Indonesia. Established in Jakarta on February 26, 2019 CHAIRMAN OF THE COMMISSIONERS BOARD FINANCIAL SERVICES AUTHORITY REPUBLIC OF INDONESIA, signed WIMBOH SANTOSO Promulgated in Jakarta on February 26, 2019

MINISTER OF LAW AND HUMAN RIGHTS
REPUBLIC OF INDONESIA, signed
YASONNA H. LAOLY
STATE GAZETTE OF THE REPUBLIC OF INDONESIA YEAR 2019 NUMBER 40

EXPLANATION
OF
FINANCIAL SERVICES AUTHORITY REGULATION
REPUBLIC OF INDONESIA
NUMBER 10 /POJK.05/2019
CONCERNING
THE MANAGEMENT OF SHARIA FINANCING BUSINESS
AND SHARIA BUSINESS UNITS OF FINANCING COMPANIES

I. GENERAL
The Financial Services Authority Regulation concerning the Management of Sharia Financing Business and Sharia Business Units (UUS) of Financing Companies is an effort to improve Financial Services Authority Regulation Number 31/POJK.05/2014 concerning the Management of Sharia Financing Business. The background and purpose of the establishment of this Financial Services Authority Regulation are to increase the growth of the Sharia Financing Company and Financing Company UUS industry through regulations expanding business activities that increase legal certainty for industry players, while still paying attention to prudential aspects and good corporate governance. As an effort to improve Financial Services Authority Regulation Number 31/POJK.05/2014 concerning the Management of Sharia Financing Business, there are content matters that are adjusted and/or added in this Financial Services Authority Regulation, including:

1. Increasing the role of Sharia Financing Companies and Financing Company UUS in the national economy, namely minimum productive business financing, expansion of business activities, financing cooperation, and fintech 2.0 by Sharia Financing Companies and Financing Company UUS.
2. Increasing prudential regulations, namely the issuance of securities as a source of funding, limits on Sharia financing acquisition incentives, and fraud control and anti-fraud strategies.
3. Increasing consumer protection, namely transparency of the nisbah ratio, margins, and/or service fees, prohibition on pawning collateral evidence and the obligation to return collateral evidence, maintenance of collateral evidence, and withdrawal and sale of collateral.
   This Financial Services Authority Regulation is expected to increase the role of Sharia Financing Companies and Financing Company UUS in driving national development by creating healthier, reliable, trustworthy, and generally competitive Financing Companies, which can be done by improving Financial Services Authority Regulations regarding Financing Companies. In this regard, the Financial Services Authority establishes this Financial Services Authority Regulation concerning the Management of Sharia Financing Business and Sharia Business Units of Financing Companies.

II. ARTICLE BY ARTICLE
Article 1
Sufficiently clear.
Article 2
What is meant by:
“Adl” is placing something only in its place, giving something only to those entitled, and treating something according to its position.
“Tawazun” includes the balance of material and spiritual aspects, private and public aspects, financial sector and real sector, business and social aspects, and the balance of utilization and sustainability aspects. “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 overall aspects without causing harm. “Alamiyah” can be done by, with, and for all interested parties (stakeholders) without distinguishing ethnicity, religion, race, and class, in accordance with the spirit of universal mercy (rahmatan lilalamin). “Gharar” is a transaction where the object is unclear, not owned, not known to exist, or cannot be delivered at the time of the transaction unless otherwise regulated in Sharia. “Maysir” is a speculative (gambling) transaction not directly related to productivity in the real sector. “Riba” is the assurance of illegal income addition (bathil), including in transactions exchanging goods of the same type that are not equal in quality, quantity, and delivery time (fadhl), or in loan transactions requiring the facility recipient to return funds received exceeding the loan principal due to the passage of time (nasiah). “Zhulm” is a transaction that causes injustice to other parties. “Risywah” is bribery in the form of money, facilities, or other forms that violate the law as an effort to obtain facilities or ease in a transaction. “Objek haram” is goods or services prohibited in Sharia.
Article 3
Paragraph (1)
Sufficiently clear.
Paragraph (2)
Included in what must be supported by provisions as referred to in paragraph (2) here are all activities in Sharia Financing, financing, and other activities that affect the business activities of Sharia Companies. Paragraph (3) Sufficiently clear.
Article 4
Sufficiently clear.
Article 5
Paragraph (1)
Sufficiently clear.
Paragraph (2)
Sufficiently clear.
Paragraph (3)
Sufficiently clear.
Paragraph (4)
What is meant by “several contracts” is contracts as referred to in this Financial Services Authority Regulation and other contracts approved by the Financial Services Authority.
Article 6
Letter a
Sufficiently clear.
Letter b
What is meant by “contracts other than contracts” includes those conducted using a combination of several contracts or conducted using contracts other than those regulated in this Financial Services Authority Regulation.
Article 7
Sufficiently clear.
Article 8
Sufficiently clear.
Article 9
Paragraph (1)
Sufficiently clear.
Paragraph (2)
What is meant by “absolute termination” is that Sharia Companies no longer conduct business activities using specific contracts which were previously approved or recorded by the Financial Services Authority. With this termination, the company no longer markets and closes new Sharia Financing agreements with contracts whose use has been terminated. Paragraph (3) Sufficiently clear.
Article 10
Paragraph (1)
Sufficiently clear.
Paragraph (2)
Sufficiently clear.
Paragraph (3)
What is meant by absolute termination is that Sharia Companies are prohibited from using specific contracts previously recorded or approved by the Financial Services Authority for all activities based on provisions, specifications, or features submitted to the Financial Services Authority. In this case, the Financial Services Authority will issue a letter of approval cancellation or recording cancellation letter. As for partial termination, Sharia Companies are prohibited from conducting specific features or cooperation with certain parties or other specific matters based on provisions, specifications, or features submitted to the Financial Services Authority. Outside of the prohibited matters, Sharia Companies can still use contracts that have been recorded or approved by the Financial Services Authority. In this case, the Financial Services Authority will cancel specific provisions, specifications, or features. Paragraph (4) Sufficiently clear. Paragraph (5) Sufficiently clear.
Article 11
Sufficiently clear.
Article 12
Sufficiently clear.
Article 13
Paragraph (1)
What is meant by “integrated information and technology system” is an information and technology system that combines different activities, programs, or hardware components into one functional unit. Paragraph (2) Sufficiently clear.
Article 14
Paragraph (1)
What is meant by “conducting business activities utilizing information technology” is that Sharia Companies execute:
a. marketing activities; b. Sharia Financing application submissions; and
c. installment payment monitoring,
through electronic systems using internet networks.
Electronic systems are a series of electronic devices and procedures that function to prepare, collect, process, analyze, store, display, announce, send, and/or disseminate electronic information in the field of financial services. Paragraph (2) Sufficiently clear.
Article 15
Paragraph (1)
Sufficiently clear.
Paragraph (2)
Sufficiently clear.
Paragraph (3)
Sufficiently clear.
Paragraph (4)
Sufficiently clear.
Paragraph (5)
Sufficiently clear.
Paragraph (6)
Sufficiently clear.
Paragraph (7)
Sufficiently clear.
Paragraph (8)
Sufficiently clear.
Paragraph (9)
Letter a
Sufficiently clear.
Letter b
What is meant by “guarantee of productive assets of Sharia Financing” includes:
a. Sharia guarantees as referred to in Financial Services Authority Regulations regarding guarantee institutions; and/or b. guarantees of receivables of Sharia Financing from the respective corporations.
Article 16
Paragraph (1)
Sufficiently clear.
Paragraph (2)
Examples of the application of the down payment amount:
If based on the monthly report of the Sharia Company as of June 30, 2019, the Sharia Company has a Net Productive Asset Ratio for Sharia Financing of motor vehicles higher than 5% (five percent), then that Sharia Company imposes the down payment amount provisions for Motor Vehicle Financing as referred to in Article 15 paragraph (5). The application of the Down Payment Amount for Sharia Financing of Motor Vehicles mentioned takes effect from August 1, 2019, to January 31, 2020. If based on the monthly report of the Sharia Company as of December 31, 2019, the Sharia Company has a Financial Health Level with a healthy condition and has a Net Productive Asset Ratio for Sharia Financing of motor vehicles of the Sharia Company at 4.5% (four point five percent), then that Sharia Company imposes the down payment amount provisions for Sharia Financing of Motor Vehicles as referred to in Article 15 paragraph (3). The application of the Down Payment Amount for Sharia Financing of Motor Vehicles mentioned takes effect from February 1, 2020, to July 31, 2020. If based on the monthly report of the Sharia Company as of June 30, 2020, the Sharia Company has a Financial Health Level with a healthy condition and has a Net Productive Asset Ratio for Sharia Financing of motor vehicles of the Sharia Company of 1.5% (one point five percent) or lower, then that Sharia Company imposes the down payment amount provisions for Sharia Financing of Motor Vehicles as referred to in Article 15 paragraph (2). The application of the Down Payment Amount for Sharia Financing of Motor Vehicles mentioned takes effect from August 1, 2020, to January 31, 2021. Paragraph (3) Examples of calculating the down payment amount:
If the price of a two-wheeled vehicle: Rp10,000,000.00 Price deduction (discount) and other deductions given: Rp500,000.00 Vehicle selling price: Rp10,000,000.00 – Rp500,000.00 = Rp9,500,000.00 For Sharia Financing Companies meeting the criteria as referred to in Article 15 paragraph (3), the Down Payment Amount for Sharia Financing of two-wheeled motor vehicles that must be imposed and paid in a lump sum is 10% x Rp9,500,000.00 = Rp950,000.00 Paragraph (4) Example 1 (Sharia insurance costs, Sharia guarantees, or other costs paid in a lump sum by Consumers):
Price of two-wheeled vehicle: Rp10,000,000.00
Price deduction (discount) and other deductions given: Rp500,000.00 Sharia insurance costs, Sharia guarantees, or other costs paid in a lump sum by Consumers: Rp1,000,000.00 Vehicle selling price: Rp10,000,000.00 – Rp500,000.00 = Rp9,500,000.00 For Sharia Financing Companies meeting the criteria as referred to in Article 15 paragraph (3), the Down Payment Amount for Sharia Financing of two-wheeled motor vehicles that must be imposed and paid in a lump sum is 10% x Rp9,500,000.00 = Rp950,000.00 Costs paid by Consumers in a lump sum (if Sharia insurance costs, Sharia guarantees, or other costs are paid in a lump sum by Consumers) = down payment (Rp950,000.00) + Sharia insurance costs, Sharia guarantees, or other costs (Rp1,000,000.00) = Rp1,950,000.00 Total Sharia Financing by Sharia Financing Companies to Consumers = vehicle selling price (Rp9,500,000.00) – down payment (Rp950,000.00) = Rp8,550,000.00 Example 2 (Sharia insurance costs, Sharia guarantees, or other costs are not paid in a lump sum (installments) by Consumers):
Vehicle price: Rp10,000,000.00
Price deduction (discount) and other deductions given: Rp500,000.00 Sharia insurance costs, Sharia guarantees, or other costs: Rp1,000,000.00 Vehicle selling price: Rp10,000,000.00 – Rp500,000.00 = Rp9,500,000.00 Down Payment Amount for Sharia Financing of two-wheeled motor vehicles that must be imposed is 10% x Rp9,500,000.00 = Rp950,000.00 Thus, costs paid by Consumers if costs

insurance/sharia guarantee or other costs not paid in cash by the Consumer or paid in installments = down payment (Rp950,000.00) Total Sharia Financing by the Sharia Financing Company to the Consumer = sharia insurance/guarantee or other costs (Rp1,000,000.00) + price of sharia financing for two-wheeled motor vehicles (Rp8,550,000.00) = Rp9,550,000.00 Paragraph (5) Clearly stated.
Article 17
Paragraph (1)
What is meant by "acquisition incentive costs for Sharia Financing to third parties" is all types of payments to third parties or third-party employees for business acquisition, including:
a. commission payments to providers of goods and/or services paid in cash; b. target achievement incentives;
c. third-party travel costs;
d. joint promotion costs; e. income tax; and/or f. other expenses related to the acquisition of Sharia Financing paid to third parties.
Example of limitation on acquisition incentive costs for Sharia Financing to third parties:
PT ABC Finance Syariah distributes Sharia Financing for motor vehicles to a Consumer in one Sharia Financing Agreement with a Sharia Financing value of Rp100,000,000.00. Through the distribution of this Sharia Financing, PT ABC Finance Syariah receives the following income:

1. margin income of Rp43,000,000.00;

2. sharia insurance discount income of
   Rp15,000,000.00;

3. administrative income of Rp1,000,000.00; and

4. commission income of Rp1,000,000.00.
   Thus, the maximum total third-party incentive costs related to the acquisition of Sharia Financing that can be given for the distribution of Sharia Financing to the Consumer is equal to = (17.5% x (Rp43,000,000.00 + Rp15,000,000.00

• Rp1,000,000.00 + Rp1,000,000.00)) = Rp10,500,000.00.
  The total incentive costs have taken into account commissions to providers of goods and/or services paid in cash, target achievement incentives, third-party travel costs, joint promotion costs, and/or income tax, and other expenses related to the acquisition of Sharia Financing paid to third parties. Paragraph (2) Clearly stated.
  Article 18
  Paragraph (1)
  Example calculation of BMPPS to all related parties:
  Based on monthly report data as of April 30, 2022, PT ABC Finance Syariah has Equity valued at Rp1 trillion. PT XYZ is a related company with PT ABC Finance Syariah. PT ABC Finance Syariah has also distributed Sharia Financing to related parties including PT XYZ worth Rp450 billion. On May 5, 2022, PT XYZ obtained a new Sharia Financing ceiling worth Rp100 billion with disbursement conducted in stages as follows:
  The first stage was disbursed on May 5, 2022, worth Rp30 billion and the second stage was disbursed on May 12, 2022 with a value of Rp70 billion.
  In the first disbursement on May 5, 2022, PT ABC Finance Syariah did not violate the BMPPS regulations for all related parties with the following calculation:
  Equity as of April 30, 2022 Rp1 trillion
  BMPPS for all related parties 50% x Rp1 trillion = Rp500 billion Total Productive Asset Balance (Outstanding Principal) as of May 5, 2022

= Rp450 billion + Rp30 billion = Rp480 billion (48% of Equity value).
In the second disbursement on May 12, 2022, PT ABC Finance Syariah violated the BMPPS regulations for all related parties with the following calculation:
Equity as of April 30, 2022 Rp1 trillion
BMPPS for all related parties 50% x Rp1 trillion = Rp200 billion Total Productive Asset Balance (Outstanding Principal) as of May 12, 2022 = Rp450 billion + Rp30 billion + Rp70 billion = Rp550 billion (55% of Equity value). Paragraph (2) Clearly stated. Paragraph (3) Clearly stated. Paragraph (4) Letter a What is meant by "controller" is a party that directly or indirectly has the ability to determine the board of directors, board of commissioners, or equivalent to the board of directors or board of commissioners on a legal entity in the form of a cooperative and/or influence the actions of the board of directors, board of commissioners, or equivalent to the board of directors or board of commissioners on a legal entity in the form of a cooperative. Letter b Clearly stated. Letter c Clearly stated. Letter d Clearly stated. Letter e Clearly stated. Letter f What is meant by "family relationship up to the second degree, both horizontal and vertical" is the following parties:

1. biological/step/adoptive parents;
2. biological/step/adoptive siblings;
3. biological/step/adoptive children;
4. biological/step/adoptive grandparents;
5. biological/step/adoptive grandchildren;
6. biological/step/adoptive siblings of parents;
7. husband or wife;
8. parents-in-law or in-laws;
9. husband or wife of biological/step/adoptive children;
10. grandparents of husband or wife;
11. husband or wife of biological/step/adoptive grandchildren; and
12. biological/step/adoptive siblings of husband or wife
    along with the husband or wife of the sibling in question.
    Letter g
    What is meant by "directors in business entities" as referred to in letters a to d is a party that performs management functions as regulated in applicable laws and regulations. What is meant by "board of commissioners in business entities" as referred to in letters a to d is a party that performs supervisory and advisory functions as regulated in applicable laws and regulations. Letter h Clearly stated. Letter i Clearly stated. Letter j What is meant by "financial interdependence" is a condition where there is mutual financial dependence between the Sharia Company and other parties including among others significant lending transactions larger than the Equity value of the Sharia Company, subordinated loans and so on.

Paragraph (5)
Clearly stated.
Article 19
Paragraph (1)
Example calculation of BMPPS per 1 (one) unrelated party:
On April 30, 2022, PT ASD had a total Sharia Financing Productive Asset Balance (Outstanding Principal) value at PT ABC Finance Syariah of Rp140 billion. Based on Monthly Report data as of April 30, 2022, PT ABC Finance Syariah has Equity valued at Rp1 trillion. PT ASD is not a related company with PT ABC Finance Syariah. On May 5, 2022, PT ASD obtained a new Sharia Financing ceiling worth Rp100 billion with disbursement conducted in stages as follows:

1. the first stage was disbursed on May 5, 2022, worth
   Rp30 billion; and
2. the second stage was disbursed on May 12, 2022 with
   a value of Rp70 billion.
   In the first disbursement on May 5, 2022, PT ABC Finance Syariah did not violate the BMPPS regulations per Unrelated Consumer with the following calculation:
   Equity as of April 30, 2022 Rp1 trillion
   BMPPS per Unrelated Consumer 20% x Rp1 trillion = Rp200 billion Total Productive Asset Balance (Outstanding Principal) as of May 5, 2022 = Rp140 billion + Rp30 billion = Rp170 billion (17% of Equity value). In the second disbursement on May 12, 2022, PT ABC Finance Syariah violated the BMPPS regulations per Unrelated Consumer with the following calculation:
   Equity as of April 30, 2022 Rp1 trillion
   BMPPS per Unrelated Consumer 20% x
   Rp1 trillion = Rp200 billion.
   Total Productive Asset Balance (Outstanding Principal) as of May 12, 2022 = Rp140 billion + Rp30 billion + Rp70 billion = Rp240 billion

(24% of Equity value).
Paragraph (2)
Example of BMPPS regulations for 1 (one) group of Consumers who are not related parties:
Based on monthly report data as of April 30, 2022, PT ABC Finance Syariah has Equity valued at Rp1 trillion. PT ASD is not a related company with PT ABC Finance Syariah. PT ABC Finance Syariah has also distributed financing to other companies in 1 group affiliated with PT ASD worth Rp450 billion. On May 5, 2022, PT ASD obtained a new Sharia Financing ceiling worth Rp100 billion with disbursement conducted in stages as follows:

1. the first stage was disbursed on May 5, 2022, worth
   Rp30 billion; and
2. the second stage was disbursed on May 12, 2022 with
   a value of Rp70 billion.
   In the first disbursement on May 5, 2022, PT ABC Finance Syariah did not violate the BMPPS regulations for the group of Unrelated Consumers with the following calculation:
   Equity as of April 30, 2022 Rp1 trillion.
   BMPPS for group of Unrelated Consumers = 50% x Rp1 trillion = Rp500 billion Total Productive Asset Balance (Outstanding Principal) as of May 5, 2022 = Rp450 billion + Rp30 billion = Rp480 billion (48% of Equity value). In the second disbursement on May 12, 2022, PT ABC Finance Syariah violated the BMPPS regulations for the group of Unrelated Consumers with the following calculation:
   Equity as of April 30, 2022 Rp1 trillion
   BMPPS for group of Unrelated Consumers = 50% x Rp1 trillion = Rp500 billion Total Productive Asset Balance (Outstanding Principal) as of May 12, 2022 = Rp450 billion + Rp30 billion + Rp70 billion = Rp550 billion (55% of Equity value).

Paragraph (3)
Clearly stated.
Paragraph (4)
Clearly stated.
Paragraph (5)
Clearly stated.
Article 20
What is meant by "Sharia Financing for the procurement of goods and/or services in government programs" is Sharia Financing for:
a. food procurement; b. very simple house procurement;
c. procurement/provision/management of oil and gas as well as
other equivalent alternative energy sources; d. procurement/processing of export-oriented commodities; e. procurement/provision/management of water; f. procurement/provision/management of electricity; and/or g. procurement of supporting infrastructure for land, sea, and air transportation in the form of road, bridge, railway, sea port, and airport construction.
Article 21
Paragraph (1)
What is meant by "Sharia Financing risk mitigation" is efforts carried out by the Sharia Company to reduce the risks borne by the Sharia Company due to the inability/failure of the Consumer to meet payment obligations to the Sharia Company. Paragraph (2) Clearly stated.
Article 22
Clearly stated.
Article 23
Clearly stated.

Article 24
Clearly stated.
Article 25
Paragraph (1)
These provisions apply if the Sharia Financing Agreement contains a fiduciary security burden clause both in the principal sharia financing agreement and in a separate document. Paragraph (2) Clearly stated.
Article 26
Clearly stated.
Article 27
Clearly stated.
Article 28
Clearly stated.
Article 29
Clearly stated.
Article 30
Clearly stated.
Article 31
Paragraph (1)
Letter a
Clearly stated.
Letter b
Clearly stated.
Letter c
What is meant by "Sharia Financing cooperation" is cooperation with other parties through financing channeling or Joint Sharia Financing (joint financing) carried out in accordance with applicable laws and regulations. Letter d Clearly stated. Letter e Clearly stated. Letter f Clearly stated. Letter g Clearly stated. Letter h Clearly stated. Letter i Clearly stated. Letter j Clearly stated. Letter k Clearly stated. Letter l Clearly stated. Letter m Clearly stated. Letter n Clearly stated. Letter o Clearly stated. Letter p Clearly stated. Letter q Clearly stated. Letter r Clearly stated. Letter s Clearly stated. Letter t Clearly stated.

Paragraph (2)
Clearly stated.
Article 32
Clearly stated.
Article 33
Clearly stated.
Article 34
Clearly stated.
Article 35
Clearly stated.
Article 36
Paragraph (1)
Clearly stated.
Paragraph (2)
Clearly stated.
Paragraph (3)
What is meant by "financing channeling with recourse" is financing channeling from other parties to the Sharia Company by requiring the Sharia Company to bear all/some of the risks of Sharia Financing. What is meant by "joint financing with recourse" is joint financing between Sharia Companies and other parties by requiring the Sharia Company to bear all/some of the financing risks outside the risk share that should be borne by the Sharia Company based on the amount of funds provided. Practices included in "joint financing with recourse" include among others if in agreements with fund providers it is stipulated that in the event the Consumer of the Sharia Company defaults, the Sharia Company replaces that Consumer with another Consumer who has productive asset quality that is current or the Sharia Company continues to pay the fund provider as a replacement for the Consumer's installments. Paragraph (4) Letter a Clearly stated. Letter b Clearly stated. Letter c Clearly stated. Letter d Clearly stated. Letter e Clearly stated. Letter f Clearly stated. Letter g What is included in "other institutions" includes among others credit cooperatives. Paragraph (5) Clearly stated.
Article 37
Clearly stated.
Article 38
Clearly stated.
Article 39
What is meant by "adequate information and technology systems" is a technology system that has met the provisions of applicable laws and regulations regarding information and electronic transactions.

Article 40
Paragraph (1)
Clearly stated.
Paragraph (2)
Clearly stated.
Paragraph (3)
What is meant by "risk mitigation" includes among others the Sharia Company having a storage location for proof of ownership of the object of Sharia Financing that meets security standards or is deposited at a custodian (custodian). Paragraph (4) What is meant by "custodian" includes among others custodian banks, pawn companies, and/or companies whose business field is in the field of storage services. What is meant by "security standards" includes among others fireproof safes, termite-proof safes, and rooms with fire prevention systems.
Article 41
Paragraph (1)
Clearly stated.
Paragraph (2)
What is meant by "mutatis mutandis" is that the provisions in Article 40 paragraph (2) to paragraph (4) apply exactly the same to Article 41 paragraph (1) letter c.
Article 42
Clearly stated.
Article 43
Paragraph (1)
What is meant by "Sharia Financing settlement" is the Consumer has made payment of all obligations to the Sharia Company.
Paragraph (2)
Clearly stated.

Article 44
Clearly stated.
Article 45
Paragraph (1)
Clearly stated.
Paragraph (2)
Clearly stated.
Paragraph (3)
Letter a
Clearly stated.
Letter b
Clearly stated.
Letter c
What is meant by "collection" is all efforts carried out by the Sharia Company to obtain its rights over the Consumer's obligation to pay installments, including among others conducting execution of collateral in the event of Consumer default. Paragraph (4) What is meant by "fully responsible" is the Sharia Company is fully responsible for all impacts arising from cooperation with other parties as long as the other parties in question act in accordance with the cooperation agreement. Paragraph (5) Clearly stated.
Article 46
Clearly stated.
Article 47
Paragraph (1)
Letter a
What is meant by "default" is the Consumer's inability to meet obligations as stated in the Sharia Financing Agreement.
Letter b
Clearly stated.
Letter c
Clearly stated.
Paragraph (2)
Clearly stated.
Paragraph (3)
Clearly stated.
Paragraph (4)
Clearly stated.
Article 48
Clearly stated.
Article 49
Clearly stated.
Article 50
Paragraph (1)
What is meant by "fraud" is an act of deviation or intentional tolerance to deceive, trick, or manipulate the Sharia Company, Consumer, or other parties, which occurs within the Sharia Company environment and/or using Sharia Company facilities so that it causes the Sharia Company, Consumer, or other parties to suffer losses and/or the fraud perpetrator obtains financial benefits either directly or indirectly. Paragraph (2) Clearly stated.
Article 51
Clearly stated.
Article 52
Clearly stated.

Article 53
Paragraph (1)
Clearly stated.
Paragraph (2)
Letter a
Clearly stated.
Letter b
Clearly stated.
Letter c
Clearly stated.
Letter d
Clearly stated.
Letter e
Included in data security, the Sharia Company must have an adequate continuous program.
Control of this information system needs to be accompanied by the availability of an accounting system to ensure the use of accurate and consistent data in recording and financial reporting of the Sharia Company including among others through reconciliation or data verification on a regular basis. Letter f Clearly stated.
Article 54
Clearly stated.
Article 55
Paragraph (1)
Clearly stated.
Paragraph (2)
Letter a
Acts of deviation carried out by the Consumer include among others in the process of applying for Sharia Financing, installment payments, and/or execution of collateral. Letter b Acts of deviation carried out by internal Sharia Company personnel acting alone or colluding with internal or external parties of the Sharia Company. Letter c What is included in "other parties" includes among others vehicle dealers, sharia insurance companies, and legal entities that cooperate with the Sharia Company to perform collection and/or collateral execution functions. Acts of deviation carried out by other parties that cooperate with the Sharia Company to perform collection and/or collateral execution functions for Consumers include among others embezzlement of executed collateral and/or destruction of collateral.
Article 56
Clearly stated.
Article 57
Letter a
Number 1
For example, a zero tolerance policy against fraud.
Number 2
For example, organizing seminars or discussions related to anti-fraud, training, and publication regarding understanding of fraud forms, transparency of investigation results, and follow-up on fraud committed on a continuous basis. Number 3 For example, creating anti-fraud brochures, written explanations or through other means to increase Consumer awareness and vigilance against the possibility of fraud occurring. Letter b Number 1 Clearly stated.

Number 2
What is meant by "interested parties" includes among others internal auditors, members of the Board of Commissioners, external auditors, and/or the Financial Services Authority. Number 3 Clearly stated. Letter c Number 1 Through this system, it is hoped that a comprehensive and accurate picture of prospective employees' (pre-employee screening) track records can be obtained. Number 2 The system must cover the implementation of promotions as well as transfers, including placement in positions with high risk against fraud. Number 3 What is meant by "know your employee" includes among others recognition and monitoring of employee character, behavior, and lifestyle.
Article 58
Clearly stated.
Article 59
Clearly stated.
Article 60
Clearly stated.
Article 61
Paragraph (1)
Letter a
Provisions regarding reports on the implementation of good corporate governance for Sharia Companies refer to Financial Services Authority Regulations regarding good corporate governance for financing companies.

Letter b
Clearly stated.
Paragraph (2)
Clearly stated.
Paragraph (3)
Clearly stated.
Article 62
Clearly stated.
Article 63
Paragraph (1)
Clearly stated.
Paragraph (2)
For example, if a member of the Board of Directors is declared approved by the Financial Services Authority as a member of the Board of Directors of PT ABC Finance Syariah on May 1, 2019, then the time frame for fulfilling continuous requirements for the first annual period is in the calendar year period between May 1 January 2020 to December 31, 2020. Paragraph (3) Clearly stated. Paragraph (4) Clearly stated. Paragraph (5) Clearly stated.
Article 64
Clearly stated.
Article 65
Paragraph (1)
Letter a
Clearly stated.

Letter b
Companies related to the activities of the
Sharia Company include among others vehicle dealers, credit information management institutions, outsourcing providers in the field of collection, and/or surveyors. Paragraph (2) Clearly stated. Paragraph (3) Clearly stated. Paragraph (4) Clearly stated.
Article 66
Paragraph (1)
Letter a
Clearly stated.
Letter b
What is meant by "other institutions and/or business entities" can come from:
a. Indonesian institutions and/or business entities; and/or b. foreign institutions and/or business entities.
Letter c
Clearly stated.
Letter d
Clearly stated.
Letter e
Examples of funding through the issuance of sukuk not through public offering, including among others: ijarah sukuk, mudharabah sukuk, and medium term note syariah that are issued not through public offering. Letter f Clearly stated. Letter g Clearly stated. Paragraph (2) Clearly stated.

Paragraph (3)
What is included in "agreement" includes among others financing agreements, prospectuses, and/or information memoranda.
Paragraph (4)
Examples of funding to Sharia Companies carried out in accordance with Sharia Principles include among others PT ABC Finance Syariah receiving funding from government institutions, banks, non-bank financial industries, institutions, and/or other business entities, in the form of Mudharabah contracts.
Article 67
Clearly stated.
Article 68
Clearly stated.
Article 69
What is meant by "gearing ratio" is the ratio between the sum of loans, subordinated loans, and debt-like instruments with the difference between the sum of Equity and subordinated loans minus investments.
Article 70
Clearly stated.
Article 71
Clearly stated.
Article 72
Clearly stated.
Article 73
Clearly stated.
Article 74
Clearly stated.

Article 75
Clearly stated.
Article 76
Paragraph (1)
Example calculation of Gearing Ratio for Sharia Financing Companies:
PT ABC Finance Syariah which has Equity of Rp320 billion and paid-up capital of Rp160 billion receives total funding as follows:

1. funding received from Bank XYZ Syariah worth
   Rp400 billion;

2. issuance of sukuk issued through public offering worth Rp88 billion;

3. subordinated funding received from shareholders worth Rp52 billion; and

4. issuance of medium term note syariah worth Rp100 billion.
   PT ABC Finance also has investments in PT XYZ
   Syariah worth Rp80 billion. Thus, the value of the gearing ratio of PT ABC Finance Syariah is as follows:
   Gearing ratio =
   (funding from bank + sukuk issuance + subordinated funding + issuance of medium term note syariah) (Equity + subordinated funding) - investments Gearing ratio = (Rp400 billion + Rp88 billion + Rp52 billion + Rp100 billion) (Rp320 billion + Rp52 billion) - Rp80 billion Gearing ratio PT ABC Finance Syariah = 2.19 Example calculation of gearing ratio for UUS:
   UUS PT XYZ Finance has Equity of Rp120 billion and working capital of Rp50 billion receiving total funding as follows:

5. funding received from Bank ABC Syariah worth
   Rp200 billion;

6. issuance of sukuk issued through public offering worth Rp40 billion;

7. subordinated funding received from its parent company PT XYZ Finance Rp110 billion;

8. issuance of medium term note syariah worth Rp100 billion;
   and

9. Qardh funding from its parent company PT XYZ
   Finance Rp300 billion.
   Thus, the value of the gearing ratio of UUS PT XYZ Finance is as follows:
   Gearing ratio =
   (funding from bank + sukuk issuance + subordinated funding + issuance of medium term note syariah + funding from parent financing) (Equity + subordinated funding) - investments Gearing ratio = (Rp200 billion + Rp40 billion + Rp110 billion + Rp100 billion + Rp300 billion) (Rp120 billion + Rp55 billion) - Rp0 Gearing ratio UUS PT XYZ Finance = 4.29 Paragraph (3) Clearly stated.
   Article 77
   Paragraph (1)
   Clearly stated.
   Paragraph (2)
   In the event that a Sharia Company receives funding, distributes Sharia Financing, and receives payment in the same foreign currency, it is categorized as having performed a natural hedge as one of the hedging efforts.
   Article 78
   Clearly stated.
   Article 79
   Letter a
   Clearly stated.
   Letter b
   Clearly stated.
   Letter c
   Clearly stated.

Letter d
Included in the "promissory note" are, among others, commercial paper based on Sharia Principles having a maturity of up to 1 (one) year.

Letter e
Clear enough.

Letter f
Clear enough.

Article 80
Clear enough.

Article 81
Paragraph (1)
Clear enough.

Paragraph (2)
Clear enough.

Paragraph (3)
Clear enough.

Paragraph (4)
Clear enough.

Paragraph (5)
Regulations regarding UUS (Sharia Business Unit) in settlement refer to the Financial Services Authority Regulation regarding business licensing and institutionalization of Financing Companies.

Article 82
Paragraph (1)
What is meant by "financing" is the sum of loans, subordinated loans, and fixed-income Sharia securities issued either through a public offering or not through a public offering.

Paragraph (2)
What is meant by "set realistically" is the ratio of Net Productive Asset Balance (Outstanding Principal) to total financing, compiled by considering external and internal factors that can affect the development of Sharia businesses, prudence principles, and the principles of healthy financial service institutions, so that it is measurable and achievable.

Paragraph (3)
Clear enough.

Article 83
Clear enough.

Article 84
Clear enough.

Article 85
Clear enough.

Article 86
Clear enough.

Article 87
Clear enough.

Article 88
The assessment of productive asset quality is conducted on the Productive Asset Balance (Outstanding Principal), not based on the amount of principal installments and/or ratios, margins, and/or service fees that have become due.

Steps that Sharia Companies can take to keep productive assets good include the application of adequate standard procedures and operations and periodic monitoring of Productive Asset quality.

Article 89
Clear enough.

Article 90
Clear enough.

Article 91
Clear enough.

Article 92
Clear enough.

Article 93
Clear enough.

Article 94
Clear enough.

Article 95
Clear enough.

Article 96
Clear enough.

Article 97
Clear enough.

Article 98
Clear enough.

Article 99
Clear enough.

Article 100
Clear enough.

Article 101
Clear enough.

Article 102
Paragraph (1)
Clear enough.

Paragraph (2)
Clear enough.

Paragraph (3)
Clear enough.

Paragraph (4)
Clear enough.

Paragraph (5)
Regulations regarding the registration of public accountants refer to the Financial Services Authority Regulation regarding the use of public accountant services and public accounting firms in financial service institution activities.

Paragraph (6)
Clear enough.

Article 103
Clear enough.

Article 104
Clear enough.

Article 105
Clear enough.

Article 106
Clear enough.

Article 107
Clear enough.

Article 108
Clear enough.

Article 109
Clear enough.

Article 110
Paragraph (1)
Clear enough.

Paragraph (2)
Clear enough.

Paragraph (3)
Clear enough.

Paragraph (4)
Clear enough.

Paragraph (5)
Clear enough.

Paragraph (6)
Clear enough.

Paragraph (7)
Clear enough.

Paragraph (8)
Clear enough.

Paragraph (9)
Included in "business activities" include the disbursement of new financing and the receipt of new funding.

Paragraph (10)
Clear enough.

Paragraph (11)
Clear enough.

Paragraph (12)
Clear enough.

Paragraph (13)
Clear enough.

Article 111
Clear enough.

Article 112
Clear enough.

Article 113
Clear enough.

Article 114
Clear enough.

Article 115
Clear enough.

Article 116
Clear enough.

Article 117
Clear enough.

Article 118
Clear enough.

SUPPLEMENT TO THE STATE GAZETTE OF THE REPUBLIC OF INDONESIA NUMBER 6320

APPENDIX
FINANCIAL SERVICES AUTHORITY REGULATION
NUMBER 10 /POJK.05/2019
ON
THE OPERATION OF SHARIA FINANCING COMPANIES AND SHARIA BUSINESS UNITS OF FINANCING COMPANIES

FORMAT 1 EXAMPLE OF REPORTING PLAN FOR ISSUANCE OF SHARIA SECURITIES THROUGH PUBLIC OFFERING Number : ….. (place), …..(date/month/year) Attachment :
Subject : Reporting Plan for Issuance of Sharia Securities Through Public Offering.......(type of security) PT/Cooperative.........
To
Honorable Head of Executive Supervisor for Insurance, Pension Funds, Financing Institutions, and Other Financial Service Institutions u.p. Director of Sharia Financial Institution Business Supervision Wisma Mulia 2 Floor 15 Jalan Jenderal Gatot Subroto Number 42, South Jakarta Referring to Financial Services Authority Regulation Number /POJK.05/2019 concerning the Operation of Sharia Financing Companies and Sharia Business Units of Financing Companies, we hereby submit a report on the plan to issue Sharia securities .... through a public offering. To complete the aforementioned reporting, we hereby submit the following documents:
a. details of the planned use of funds to be obtained from the public offering; b. history of previous Sharia securities issuance (if any);
c. projected financial statements;
d. information regarding events and important transactions after the date of the financial statements audited by the public accounting firm; e. statement from the Board of Directors and the Board of Directors of Financing Companies that have UUS; and f. management statement in the field of accounting.

We can convey that for this purpose, you may contact Sdr./Sdri....., via email address.... or phone number....
Thus, this request is submitted, and for your attention, Sir/Madam, we express our gratitude.
Board of Directors of PT/Cooperative,
..............................................
(clear name and signature of authorized Board of Directors members)

FORMAT 2 EXAMPLE OF DIRECTOR STATEMENT LETTER FOR REPORTING PLAN FOR ISSUANCE OF SHARIA SECURITIES THROUGH PUBLIC OFFERING We, the undersigned below, Board of Directors members, each representing the Board of Directors from:
Company Name : ............................................................................
Address : ............................................................................
Telephone and facsimile : ............................................................................
In the plan to issue Sharia securities through public offering....................................(state the offered Sharia securities) amounting to........................, we hereby state truthfully that:

1. The letter reporting the plan for the issuance of Sharia securities through public offering .......(type of Sharia security) which has been submitted to the Financial Services Authority on date .............................., is complete and in accordance with the requirements stipulated in legislation in the field of Sharia Financing Companies.
2. We are confident that the issuance of Sharia securities through public offering submitted does not contain statements, information, or facts that are untrue or misleading.
3. We are confident that all information or material facts necessary for potential investors to make investment decisions have been fully disclosed, are correct, and are not misleading.
4. In the event that untrue, misleading information or facts are found, and/or information or facts that should have been disclosed are not yet disclosed, we promise to immediately correct and submit such information or facts to the Financial Services Authority, both before and after the issuance of Sharia securities through public offering becomes effective.
5. We will take necessary actions to perfect or complete the documents submitted in the reporting plan for the issuance of Sharia securities through public offering which has been submitted to the Financial Services Authority.
6. In the event that untrue, misleading information or facts are found, or material facts that should have been disclosed are not disclosed, upon the order of the Financial Services Authority, we are willing to take the following actions:

a. suspend the plan for the issuance of Sharia securities through public offering......... (state the type of offered Sharia securities); and/or b. cancel the plan for the issuance of Sharia securities through public offering.......... (state the type of offered Sharia securities).
7. We, as Board of Directors members, are responsible for all civil and criminal claims that may occur as a result of untrue, misleading information or facts, or facts that do not disclose material information necessary, so that the information in the report on the plan for the issuance of Sharia securities through public offering........ (state the type of offered Sharia securities) does not provide a misleading picture.
8. We promise to provide the same information or facts, both to Indonesian and foreign potential investors, at the same time.
9. We are willing to submit all required information or reports requested by the Financial Services Authority in accordance with legislation in the field of Sharia Financing Companies.
10. We promise to manage the company as best as possible for the interest of all shareholders, fund providers, and/or Consumers.
(place), (date/month/year)
Board of Directors of PT/Cooperative,
Stamp
........................................
(clear name and signature of authorized Board of Directors members)

FORMAT 3 EXAMPLE OF REPORTING PLAN FOR ISSUANCE OF SUKUK NOT THROUGH PUBLIC OFFERING Number : … (place), …..(date/month/year) Attachment :
Subject : Reporting Plan for Issuance of Sukuk Not Through Public Offering
PT/Cooperative.........
To
Honorable Head of Executive Supervisor for Insurance, Pension Funds, Financing Institutions, and Other Financial Service Institutions u.p. Director of Sharia Financial Institution Business Supervision Wisma Mulia 2 Floor 15 Jalan Jenderal Gatot Subroto Number 42, South Jakarta Referring to Financial Services Authority Regulation Number /POJK.05/2019 concerning the Operation of Sharia Financing Companies and Sharia Business Units of Financing Companies, we hereby submit a report on the plan to issue sukuk not through a public offering. To complete the aforementioned reporting, we hereby submit the following documents:
a. example of sukuk letter issued not through a public offering; b. details of the planned use of funds to be obtained;
c. plan for the information memorandum (information memorandum) to be offered;
d. history of previous sukuk issuance (if any); e. prospective financial statements; f. information regarding events and important transactions after the date of the financial statements audited by the public accounting firm; g. statement from the Board of Directors and the Board of Directors of Financing Companies that have UUS; h. plan for sukuk rating agencies and monitoring agents to be used; and
i. management statement in the field of accounting.

We can convey that for this purpose, you may contact sdr./sdri....., via email address.... or phone number....
Thus, this request is submitted, and for your attention, Sir/Madam, we express our gratitude.
Board of Directors of PT/Cooperative,
..............................................
(clear name and signature of authorized Board of Directors members)

FORMAT 4 EXAMPLE OF DIRECTOR STATEMENT LETTER FOR REPORTING PLAN FOR ISSUANCE OF SUKUK NOT THROUGH PUBLIC OFFERING We, the undersigned below, Board of Directors members, each representing the Board of Directors from:
Company Name : ............................................................................
Address : ............................................................................
Telephone and facsimile : ............................................................................
In the plan to issue sukuk not through public offering amounting to........................, we hereby state truthfully that:

1. The letter reporting the plan for the issuance of sukuk not through public offering which has been submitted to the Financial Services Authority on date .............................., is complete and in accordance with the requirements stipulated in legislation in the field of Sharia Financing Companies.
2. We are confident that the issuance of sukuk not through public offering submitted does not contain statements, information, or facts that are untrue or misleading.
3. We are confident that all information or material facts necessary for potential investors to make investment decisions have been fully disclosed, are correct, and are not misleading.
4. In the event that untrue, misleading information or facts are found, and/or information or facts that should have been disclosed are not yet disclosed, we promise to immediately correct and submit such information or facts to the Financial Services Authority, both before and after the issuance of sukuk not through public offering becomes effective.
5. We will take necessary actions to perfect or complete the documents submitted in the reporting plan for the issuance of sukuk not through public offering which has been submitted to the Financial Services Authority.
6. In the event that untrue, misleading information or facts are found, or material facts that should have been disclosed are not disclosed, upon the order of the Financial Services Authority, we are willing to take the following actions:

a. suspend the plan for the issuance of sukuk not through public offering; and/or b. cancel the plan for the issuance of sukuk not through public offering.
7. We, as Board of Directors members, are responsible for all civil and criminal claims that may occur as a result of untrue, misleading information or facts, or facts that do not disclose material information necessary, so that the information in the report on the plan for the issuance of sukuk not through public offering does not provide a misleading picture.
8. We promise to provide the same information or facts, both to Indonesian and foreign potential investors, at the same time.
9. We are willing to submit all required information or reports requested by the Financial Services Authority in accordance with legislation in the field of Sharia Financing Companies.
10. We promise to manage the company as best as possible for the interest of all shareholders, fund providers, and/or Consumers.
(place), (date/month/year)
Board of Directors of PT/Cooperative,
Stamp
........................................
(clear name and signature of authorized Board of Directors members)

FORMAT 5 REPORT ON THE REALIZATION OF THE USE OF FUNDS FROM THE ISSUANCE OF SUKUK NOT THROUGH PUBLIC OFFERING No Type of Sukuk Effective Date Realization Value of Sukuk Issuance Results Planned Use of Funds Realization of Use of Funds Remaining Funds Issuance Results of Sukuk Total Issuance Results of Sukuk Issuance Costs of Sukuk Net Results ..... ..... ..... ..... Total ..... ..... ..... ..... Total Total (place), (date/month/year) Board of Directors of PT/Cooperative, Stamp
........................................
(clear name and signature of authorized Board of Directors members)

This copy is consistent with the original
Legal Director 1
Legal Department signed
Yuliana
Notes:
a. The Column for Type of Sukuk Issuance is the Issuance of fixed-income Sharia securities not through a public offering. b. The Column for Planned Use of Funds is disclosed based on the information memorandum.
c. The Column for Realization of Use of Funds is disclosed in accordance with the Planned Use of Funds column.
d. Disclosure of details of costs incurred in carrying out the sukuk offering is presented in a separate sheet. e. The description of the plan or realization of fund usage above should be submitted in a separate sheet which is an integral part of this report. f. Disclosure of details of remaining funds from the sukuk offering is still presented in a separate sheet. g. *) filled with the report date.

Established in Jakarta on 26 February 2019
CHAIRMAN OF THE COMMISSIONERS BOARD
FINANCIAL SERVICES AUTHORITY
REPUBLIC OF INDONESIA, signed
WIMBOH SANTOSO