Stay up to date with legal developments in Indonesia.
Indonesia's Central Bank, Bank Indonesia ("BI"), recently issued new rules governing the financial technology ("FinTech") sector to support innovation while maintaining customer protection and financial stability. The new regime introduces a regulatory sandbox that allows FinTech start-ups to test new products under controlled BI supervision.
Against the backdrop of a rapidly evolving FinTech landscape, BI recently updated its regulations governing the sector. The regulation's primary development is the introduction of a regulatory 'sandbox', a controlled program to test innovative FinTech services under the supervision of BI ("sandbox"). This update discusses the key implications of BI's latest regulations, and highlights specific details of the Financial Services Authority’s ("OJK") rules concerning Peer-to-Peer lending service providers ("P2P Providers").
On 1 March 2018, Indonesia became the first country ever to issue a green sukuk bond. Assegaf Hamzah & Partners (“AHP”) advised the Government of Indonesia on the transaction, drawing on the firm's extensive expertise in this field. Partner Ahmad Fikri Assegaf advised the Ministry of Finance in 2008 on the drafting of Indonesia's first Islamic bond legislation, and AHP's expert team has built a stellar reputation for its role in advising the Government on sukuk issuance.
This landmark sukuk came directly after AHP advised the borrowers, PT Royal Lestari Utama, in relation to a pioneering corporate sustainability bond. Valued at US$95 million, the corporate green bond issuance (23 February 2018) was the first of its kind in Asia.
Although the Merger Control Regulations have been in place for eight years, it appears that some big companies are still unaware of their obligations to notify certain transactions to the Komisi Pengawas Persaingan Usaha ("KPPU"), the Indonesian competition commission. In February 2018, KPPU imposed fines on the following companies for their late notifications on their transactions:
- PT Plaza Indonesia Realty, Tbk. was fined IDR 1 billion (approximately USD 72 thousand) for its late notification on the acquisition of PT Citra Asri Property; and
- PT Nirvana Property was fined IDR 1 billion (approximately USD 72 thousand) for its late notification on the acquisition of PT Mutiara Mitra Bersama.
These fines bring the number of late notification fines since 2012 to 9. AHP believes the number of companies that are fined will continue to increase since KPPU is in the process of investigating other late notification cases.