Indonesia has progressed significantly in deregulating its economy as its ranking in the Ease of Doing Business (EODB) index for 2018, Further Information : https://www.investindonesia.go.id/en/why-invest/ease-of-doing-business

1. EODB 2019 Handbook on Protecting Minority Investors
Did any reform (e.g. a new act, code, law, decree, order, supreme court decision, amendment, stock exchange listing
rule) affecting the internal governance of corporations, the regulation of related-party transactions, disclosure
obligations, liability of company executives or access to evidence in civil litigations enter into force between June 1,
2016 and June 1, 2017? If yes, please provide the information below.
A. Name of the legislation : Financial Services Authority (OJK) Regulation No. 10/POJK.04/2017 on Amendment
to Regulation No.32/POJK.04/2014 on Plan and Implementation of company’s general meeting of
shareholders
Date of adoption: 14 March 2017
Date of entry into force: 14 March 2017
Link to electronic copy: http://eodb.ekon.go.id/produk-hukum/
Description of the reform: appointment and dismissal of public accountant shall be decided in the General
Meeting of Shareholders of the public company by taking into account the proposal from the Board of
Commissioners. For General Meeting of Shareholders approving a change in rights on certain shares
classification then the GMS shall be attended and approved by the affected shareholders of that particular
shares classification.
B. Name of the legislation : Financial Services Authority (OJK) Regulation No. 11/POJK.04/2017 on Reports on
Ownership or Every Change in the Ownership of Public Companies
Date of adoption: 14 March 2017
Date of entry into force: 14 March 2017
Link to electronic copy: http://www.ojk.go.id/id/kanal/pasar-modal/regulasi/peraturan-ojk/Pages/POJK-
Laporan-Kepemilikan-atau-Setiap-Perubahan-Kepemilikan-Saham-Perusahaan-Terbuka.aspx
Description of the reform: Every member of Board of Directors and Board of Commissioners of a Public
Company and a shareholder who holds at least 5% of the Issued and Paid-up Shares of a Public Company
should report their shares ownership and change in their share ownership of at least 0.5% from the Issued
and Paid-up shares of the company to the Financial Services Authority (OJK).
C. Name of the legislation : Financial Services Authority (OJK) Regulation No. 32/POJK.04/2015 on the Increase
of Issued and Paid-up Capital of Public Company with the Provision of Preemptive Rights
Date of adoption: 16 December 2015
Date of entry into force: 22 December 2015
Link to electronic copy: http://www.ojk.go.id/id/kanal/pasar-modal/regulasi/peraturan-
ojk/Documents/Pages/pojk-32-penambahan-modal-pt-dengan-memberikan-hak-memesan-efek-terlebih-
dahulu/SALINAN-POJK%20HMETD.pdf
Description of the reform: Revoke the Decree of the Head of Bapepam-LK No. IX.D.1 on the Preemptive
Rights and IX.D.2 on the Form and Content of the Registration Statement in the Issuance of Preemptive
Rights.
D. Name of the legislation : OJK No. 29/POJK.04/2016 on Annual Report of an Issuer or Public Company
Date of adoption: 29 July 2016
Date of entry into force: 29 July 2016
Link to electronic copy: http://www.ojk.go.id/id/kanal/pasar-modal/regulasi/peraturan-
ojk/Documents/Pages/POJK-Laporan-Tahunan-Emiten-Perusahaan-Publik/POJK-Laporan-
Tahunan.pdf
Description of the reform: Revoke the Decree of the Head of Bapepam-LK No. KEP-431/BL/2012 on the
Submission of Annual Report of an Issuer or Public Company as well as the Regulation No. X.K.6 which is
being the appendix.

2. E. Name of the legislation : Circular Letter of OJK No. 30/SEOJK.04/2016 on the Form and Content of the
Annual Report of an Issuer and Public Company
Date of adoption: 3 August 2016
Date of entry into force: 3 August 2016
Link to electronic copy: http://www.ojk.go.id/id/kanal/pasar-modal/regulasi/surat-edaran-
ojk/Documents/SAL%20-%20SEOJK_Laporan%20Tahunan%20Emiten.pdf
Description of the reform: Elaborate the points which have to be included in Issuer or Public Company’s
Annual Report
I. Private limited companies
In the following questions, please assume that Buyer Co. (“Buyer”) is a manufacturing company. It is incorporated as
a private limited company or its functional equivalent. Its shares cannot be listed on a stock exchange. Examples
include the Private Limited Company (Ltd), the Limited Liability Company (LLC), the Sociedad de Responsabilidad
Limitada (SRL), Gesellschaft mit beschränkter Haftung (GmbH) and the Société à responsabilité limitée (SARL).
Last
year
This
year
Last year law Applicable Law Comment
New question Do all members have the
right to inspect and copy any record
maintained by the company regarding
the company’s activities, financial
condition, and other circumstances that
are relevant to their rights and duties?
Yes Article 138 of
Law No.40 of
2007
A shareholder
is generally
able to inspect
the company’s
records by
giving a request
to the Board of
Directors. If
their request is
not fulfilled the
shareholder
may request
the District
Court to allow
inspection of
the company’s
records.
Does the sale of 51% or more of Buyer’s
assets require the consent of the
majority of its members? (whether such
sale occurred in a single transaction or
several transactions taking place within 1
year from the date of the first transaction)
Yes -Click Article 102 of Law No.
40 of 2007 on Limited
Liabilities Companies
("Company Law No.
40/2007" or "Company
Law") governs approval
of shareholders in the
event of sale of more
than 50% of a limited
company's assets. With
respect to listed
company, the
shareholders' approval
requirement is
governed under Article
28 of OJK Regulation
No. 32/POJK.04/2014
on Planning and
Conducting of General
Meetings of
Shareholders ("OJK
Regulation No.
32/2014"
Yes For non public
companies,
based on the
Article 102 and
89 of the Law
No. 40 of 2007
on Limited
Liability
Company, the
transfer of
assets of the
Company that
exceeds 50%
(fifty percent)
of the net
assets of the
Company in 1
(one)
transaction or
more, whether
or not related
to each other,
shall be

3. approved by
General
Meeting of The
Shareholders
which is
attended by
the
shareholders
representing at
least 3/4 of the
total valid
votes and
approved by
more than 3/4
of the total
shares with the
voting rights in
GMS.
Can members who represent 10% of
Buyer’s capital call for a meeting?
Yes -Click Article 79 (2) of
Company Law
No.40/2007 with
respect to limited
company and Article 3
of OJK Regulation No.
32/2014 with respect to
listed company
Yes If the Buyer is
not an Issuer or
Public
Company,
according to
Article 79 (2) of
Company Law
No.40/2007 on
limited liability
company, 1
(one) or more
shareholder
who jointly
represent 1/10
(one tenth) or
more of the
total number of
shares with
valid voting
rights may
request to hold
a GMS by
providing a
registered
letter to the
Board of
Directors.
Must all members of Buyer consent to
add a new member?
No -Click Article 8 of POJK
32/2015 with respect to
public listed company,
Article 94 of company
Law with respect to
limited liability company
No In the event of
a non-Public
Company, the
addition of a
new member in
a non-public
company in
Indonesia is
conducted
under the
increase of
issued and

4. paid-up capital
mechanism.
Based on
Article 41 of
Law No.
40/2007 on
Limited Liability
Company, the
increase of
issued and
paid-up capital
is undertaken
based on the
approval of
GMS which is
attended by
more than ½
(one half) of
the total
number of
shares with
valid voting
rights and
approved by
more than ½
(one half) of
the total votes
cast at the
meeting
Must a member of Buyer first offer to
sell his or her interest to the existing
members before selling to a non-
member?
Yes -Click Article 43 and 57 of
Company Law
No.40/2007 with
respect to limited
company and Article 2
of POJK 32/2015 with
respect to public listed
company (Bapepam
Regulation IX.D.I was
revoked by POJK
32/2015), Regulation
Number
38/POJK.04/2014
concerning Public
Company Capital
Increase Without
Giving Preemption
Rights
Yes Article 57 of
Law No.40 of
2007 on
Limited Liability
Company
provides that
the company’s
Articles of
Association
may regulate
the obligation to
offer shares to
the existing
shareholders
prior to offering
the shares to
any third party
Must Buyer have a management
deadlock breaking mechanism such as a
member exit buyout in case of
disagreement?
Yes -Click Article 105 (1) and
Article 119 of the
Company Law No.
40/2007 (applicable to
both public and non-
public companies), and
Article 10 (1) and (3) of
POJK 33/2014
(applicable to public
companies). Article 62
section 1 b. of the
Company Law.
Yes Article 62 of
Law No.40 of
2007 on
Limited Liability
Company
provides that a
shareholder
may request
the company to
purchase her
shares in fair
market price if
she does not
agree with the
company’s

5. action that she
considers as
detrimental to
her interests or
the company’s
interests,
including
amendment of
Articles of
Association,
transfer of
majority of
company’s
assets or
merger,
acquisition,
consolidation or
spin off of the
company.
Is there a percentage of acquired capital
that requires a new member to make a
tender offer to all remaining members of
Buyer? If yes, please specify what
percentage.
No -Click Decision of Chairman
of Capital Markets and
Financial Institutions
Supervisory Board No.
KEP-264/BL/2011 on
Acquisition of a Listed
Company (Bapepam
Rule IX.H.5)
No There is no
tender offer
requirement for
non-public
companies
Must Buyer distribute profits or pay
dividends at the latest one year from the
declaration date?
No -Click Article 36 of OJK
Regulation No. 32/2014
with respect to listed
company.
Yes In the event of
non-Public
Company,
according to
Article 71 of
the Law No.
40/2007 on
Limited
Company, the
entire net
profit, after has
been set aside
for a
mandatory
reserve, shall
be distributed
to all
shareholders as
dividends,
unless
otherwise
specified by the
GMS. In this
case, the
profits that
have been
declared shall
be immediately
distributed to
the
shareholders as
dividends
Must members of Buyer meet once a
year?
No -Click Articles 82 (1)
Company Law with
Yes If the Buyer is
not an Issuer of

6. respect to limited
company and Article 10
(1) of OJK Regulation
No. 32/2014 with
respect to listed
company
Public
Company,
based on
Article 78 of
Law No. 40 of
2007 on
Limited
Liability
Company, the
shareholders
shall hold a
GMS at least
once in a year
in the form of
an Annual
Meeting of
the
Shareholders
(AGMS) which
is mandatory
to be held
within the
period of no
later than six
months after
the end of the
financial year.
Must annual financial statements of
Buyer be audited by an external auditor?
No -Click Article 68 (1) of the
Company Law No.
40/2007 (applicable to
non-public companies)
and Bapepam Rule No.
X.K.6 (applicable to
public companies)
Yes If a company is
a non-publicly
listed company,
based on
Article 68 of
Law No.
40/2007 on
Limited Liability
Company, the
Board of
Directors shall
submit the
Company’s
annual financial
report to a
Public
Accountant to
be audited if
the Company
owns assets
and/or
business
turnover with
the value more
than IDR 50
billion. In the
case study the
Buyer is

7. assumed to
own assets that
worth more
than Rp.50
billion so its
annual financial
report shall be
audited by a
Public
Accountant.

8. II. Listed companies
In the following questions, please assume that Buyer is a publicly traded listed corporation or its functional
equivalent in Indonesia Jakarta. It is not state-owned and has issued stock that is publicly traded and is listed on your
country’s largest stock exchange. Examples include the Joint Stock Company (JSC), Public Limited Company (PLC),
C Corporation, Societas Europaea (SE), Aktiengesellschaft (AG) and Société Anonyme/Sociedad Anónima (SA).
It has not adopted specific bylaws or articles of association that differ from default corporate law or securities
regulations. It does not follow any code of corporate governance, model charter, or code of good practice, unless it is
mandatory.
If there is no stock exchange or if there are fewer than 10 firms actively traded on the stock exchange, please assume
that Buyer is a joint-stock company with a large number of shareholders.
Last
year
This
year
Last year law
Applic
able
Law
Comment
Does the sale of 51% or more of
Buyer’s assets require
shareholder approval? (whether
such sale occurred in a single
transaction or several transactions
taking place within 1 year from the
date of the first transaction)
Yes -Click Article 102 of Law No. 40
of 2007 on Limited
Liabilities Companies
("Company Law No.
40/2007" or "Company
Law") governs approval of
shareholders in the event
of sale of more than 50%
of a limited company's
assets. With respect to
listed company, the
shareholders' approval
requirement is governed
under Article 28 of OJK
Regulation No.
32/POJK.04/2014 on
Planning and Conducting
of General Meetings of
Shareholders ("OJK
Regulation No. 32/2014"
Yes For public
companies, in
accordance with
the Article 28 of
OJK Regulation
No.32/POJK.04/20
14 on the Plan
and Conduct of
General Meetings
of Shareholders of
a Public Company,
the transfer of
assets of a
Company that
exceeds 50% (fifty
percent) of the
net assets of the
Company in 1
(one) transaction
or more, whether
or not related to
each other, shall
be approved by a
General Meeting
of The
Shareholders
which is attended
by the
shareholders
representing at
least 3/4 of the
total valid votes
and approved by
more than 3/4 of
the total shares
with the voting
rights in GMS.
Furthermore,
according to the
OJK Regulation
(revision to the
Regulation of the

9. Head of
Bapepam)
No.KEP-
614/BL/2011 on
Material
Transaction and
Changes to
Primary Business
Activities or well
known as
Regulation IX.E.2,
the Company that
performs material
transaction with
the value of
transaction that
exceeds 50% (fifty
percent) of
Company's equity
shall obtain the
approval of the
GMS.
Can shareholders who hold 10%
of Buyer’s share capital call for an
extraordinary meeting?
Yes -Click Article 79 (2) of Company
Law No.40/2007 with
respect to limited
company and Article 3 of
OJK Regulation No.
32/2014 with respect to
listed company
Yes If the Buyer is not
an Issuer or Public
Company,
according to
Article 79 (2) of
Company Law
No.40/2007 on
limited liability
company, 1 (one)
or more
shareholder who
jointly represent
1/10 (one tenth)
or more of the
total number of
shares with valid
voting rights may
request to hold a
GMS by providing
a registered letter
to the Board of
Directors
Must Buyer obtain shareholder
approval to issue unissued share
up to its authorized share capital?
Yes -Click Article 8 of POJK 32/2015
with respect to public
listed company, Article 94
of company Law with
respect to limited liability
company
Yes In the event of a
Public Company,
according to
Articles 2 and 8 of
OJK Regulation
No.
32/POJK.04/2015
on the Increase of
Capital of a Public
Company by
granting
Preemptive

10. Rigths, if the
Company wish to
increase its capital
by way of share
issuance, the
Buyer is required
to grant
Preemptive Rights
to each
shareholder in
accordance with a
certain ratio
towards
percentage of
his/her
shareholding
which has
obtained the
approval from the
General Meeting
of shareholders,
has submitted a
registration
statement and
supporting
documents to the
OJK and the
registration
statement has
become effective.
Are shareholders automatically
granted subscription (preemption)
rights on new shares?
No -Click Article 43 and 57 of
Company Law
No.40/2007 with respect
to limited company and
Article 2 of POJK 32/2015
with respect to public
listed company (Bapepam
Regulation IX.D.I was
revoked by POJK
32/2015), Regulation
Number 38/POJK.04/2014
concerning Public
Company Capital
Increase Without Giving
Preemption Rights
Yes In the event of a
Public Company,
according to
Article 2 and 8 of
OJK Regulation
No.
32/POJK.04/2015
on the Increase of
Capital of a Public
Company by
granting
Preemptive
Rigths, if the
Buyer wishes to
increase its capital
by way of share
issuance, the
Buyer is required
to grant
Preemptive Rights
to each
shareholder in
accordance with a
certain ratio
towards
percentage of
his/her

11. shareholding.
Must shareholders approve the
election and dismissal of the
external auditor?
No -Click Article 68 of Law No. 40 of
2007 concerning Limited
Liability Company
Yes Based on
Financial Services
Authority (OJK)
Regulation No.
10/POJK.04/2017
on Amendment to
Regulation
No.32/POJK.04/20
14 on Plan and
Implementation
of company’s
general meeting
of shareholders
appointment and
dismissal of public
accountant shall
be decided in the
General Meeting
of Shareholders of
the public
company by
taking into
account the
proposal from the
Board of
Commissioners.
Can the majority vote of holders
of the affected shares prevent
changes to the rights of their
class of shares?
No -Click Article 19-1, 47-5 and 53
of the Company Law
Yes Based on
Financial Services
Authority (OJK)
Regulation No.
10/POJK.04/2017
on Amendment to
Regulation
No.32/POJK.04/20
14 on Plan and
Implementation
of company’s
general meeting
of shareholders
for General
Meeting of
Shareholders
approving a
change in rights
on certain shares
classification then
the GMS shall be
attended and
approved by the
affected
shareholders of
that particular
shares
classification.

12. Must the CEO and the chair of the
board of directors be different
individuals?
Yes -Click Company Law No
40/2007
Yes Given Indonesia is
a Civil Law
Country that
adopts the 2-tier
board structure,
the answer to this
question is “YES”.
This question is
made by using the
approach of
anglo-saxon legal
system (common
law) by utilizing
the terms of CEO
and Chairman of
Board of Directors
where the CEO is
responsible to the
Board of
Directors, and
Chairman of the
Board of Directors
heads the Board
of Directors itself.
This is not
relevant to
Indonesia that
uses the civil law
system that uses
the terms of the
Board of Directors
which is headed
by a President
Director and
Board of
Commissioners
that is headed by
a President
Commissioner.
Consequently, in
order to respond
to this question,
the following
question needs to
be read and
understood as
followsa: Must
the President
Director and
President
Commissioner of
a company be two
different persons?
And the answer is
“Yes” as according
to Article 92 (1) of
the Law No.

13. 40/2007 on
Limited Liability
Company, a
Director is
responsible to
carry out the
Company
operation and
management, and
according to
Article 108 of the
Company Law, the
Board of
Commissioners’
role is to
supervise the
company’s
operation as well
as to provide
recommendation
and advice to the
Board of
Directors. In this
case, due to the
clear different
functions,
appointing the
same individual as
a President
Director and
President
Commissioner of
a Company is not
allowed.
Must the board of directors (or
supervisory board) include
independent and non-executive
board members?
No -Click (A) Article 20.2 and Article
20.3 of OJK Regulation
No. 33/POJK.04/2014 on
Board of Directors and
Board of Commissioners
of an Issuer or a Public
Company ("OJK Rule
33/2014"), (B) Points
III.1.4, III.1.5, V.3 and V.4
of Attachment I of
Decision of the Board of
Directors of IDX No. Kep-
00001/BEI/01-2014 on
Listing of Shares and
Equity Securities Other
than Shares issued by
Listed Company ("IDX
Rule I-A")
Yes This question is
made by using the
approach of
anglo-saxon legal
system (common
law) that applies
the concept of
single tier board
system which is
using the term
“Board of
Directors”
including the
executive,
independent and
non-executive
members. Given
Indonesia is a Civil
Law Country that
adopts the 2-tier
board structure
which uses the
term of “Board of

14. Directors” and
“Board of
Commissioners”,
this question has
to be read in the
context of
Indonesian Law,
and therefore,
should include
Board of
Commissioners as
well. In
accordance with
Article 120 of Law
No. 40/2007 on
Limited Liability
Company, the
Company’s Article
of Association
may provide the
appointment of 1
independent
director or more
who is appointed
from the parties
who are not
affiliated with
Primary
Shareholders,
Member of Board
of Directors
and/or Board of
Commissioners.
While considering
the Buyer is a
public company,
in accordance
with Article 20 of
OJK Regulation
No.33/POJK.04/20
14 on the Board
of Directors and
Commissioners of
an Issuer or Public
Company, if the
Board of
Commissioners
consists of 2
Commissioners,
then one
Commissioner
shall be an
Independent
Commissioner,
and if the Board
of Commissioners
consists of more

15. than 2
Commissioners,
then at least 30%
of the total
number of the
Commissioners
must be
appointed as
Independent
Commissioners.
Can shareholders remove
members of the board of directors
without cause before the end of
their term?
Yes -Click Article 105 (1) and Article
119 of the Company Law
No. 40/2007 (applicable to
both public and non-public
companies), and Article
10 (1) and (3) of POJK
33/2014 (applicable to
public companies). Article
62 section 1 b. of the
Company Law.
Yes In accordance
with Article 105 of
Law No. 40/2007
on Limited
Liability Company,
members of
Board of Directors
may be removed
from time to time
according to the
decision of GMS
by conveying the
reason.
Furthermore,
based on Article
62 of the Law on
Limited Company,
each shareholder
is entitled to ask
the Company to
buy their share at
a reasonable price
if such
shareholder
disagree the act
taken by
Company that
may prejudice the
shareholder or
the Company, the
matters that are
considered as
prejudicial are: (a)
Changes to Article
of Association, (b)
transfer or
encumbrance of
the Company’s
assets amounting
to more than 50%
of the net assets
of the Company;
(c) merger,
consolidation,
acquisition and
spin-off of the
company

16. Must Buyer have a separate audit
committee?
No -Click Article 121 paragraph (1)
of the Company Law No.
40/2007 and POJK
55/2015
Yes This question is
made by using the
approach of
anglo-saxon legal
system (common
law) that applies
the concept of
single tier board
system which
uses the term
“Board of
Directors”. Given
Indonesia is a Civil
Law Country that
adopts the dual
tier board system
which uses the
terms of “Board
of Directors” and
“Board of
Commissioners”,
this question has
to be understood
in the context of
Indonesian Law,
and include the
Board of
Commissioners as
well. Given the
Buyer is a Public
Company, in
accordance with
OJK Rule No.
55/POJK.04/2015
on the
Establishment and
Working
Guidelines of the
Audit Committee,
an Issuer or Public
Company shall
own an Audit
Committee which
consists of at least
three members
from the
Independent
Commissioners
and external
parties which
shall be chaired
by an
Independent

17. Commissioner.
Is there a percentage of acquired
shares which triggers a
mandatory bid rule, requiring a
potential acquirer to make a
tender offer to all remaining
shareholders?
Yes -Click Decision of Chairman of
Capital Markets and
Financial Institutions
Supervisory Board No.
KEP-264/BL/2011 on
Acquisition of a Listed
Company (Bapepam Rule
IX.H.5)
Yes In accordance
with OJK
Regulation
(revision to the
Regulation of
the Head of
Bapepam)
No.KEP-
264/BL/2011 on
Takeover of
Public Company
(well known as
Regulation
No.IX.H.1), a
party that takes
over a public
company (that is
causing a change
on the control of
the Company)
shall perform a
tender offer on
all remaining
shares of the
public company.
Takeover is
defined as an act
that both
directly and
indirectly causes
the changes of
the Controller of
the company.
While Controller
is defined as a
Party that owns
more than 50%
of all issued and
paid-up shares
or a Party that is
able to decide,
both directly
and indirectly,
the
management
and/or policy of
the Company in
any manner.
Must Buyer distribute profits or
pay dividends within a set
Yes -Click Article 36 of OJK
Regulation No. 32/2014
Yes In the event of
Public Company,

18. maximum time period from the
declaration date?
with respect to listed
company.
Article 36 of OJK
Regulation No.
32/POJK.04/2014
on the Plan and
Conduct of
General
Meetings of
Shareholders of
a Public
Company, in the
event there is a
decision made by
the GMS
regarding cash
dividends
payment, the
company must
ensure that any
cash dividends
must be paid to
the shareholders
no later than 30
days since the
announcement of
minutes of
general meeting
of shareholders
approving the
declaration of the
cash dividends.
Is a subsidiary prohibited from
acquiring shares issued by its
parent company? If not, must the
subsidiary dispose of the shares
within a year and cannot exercise
any voting rights?
Yes -Click Article 36 (1) of Company
Law.
Yes According to
Article 36 (1) of
The Law No. 40 of
2007 on Limited
Liability Company,
a Company shall
not be allowed to
issue shares,
either to be
owned by the
Company itself or
other company,
which shares are
directly or
indirectly owned
by the Company.
Must Buyer disclose ultimate
beneficial ownership stakes (i.e.
direct and/or indirect)
representing 5%?
No -Click OJK Regulation No. 60
/POJK.04/2015 regarding
Disclosure of Information
on Certain Shareholders.
Yes Based on
Financial Services
Authority (OJK)
Regulation No.
11/POJK.04/2017
on Reports on
Ownership or
Every Change in
the Ownership of
Public Companies

19. Every member of
Board of Directors
and Board of
Commissioners of
a Public Company
and a shareholder
who holds at least
5% of the Issued
and Paid-up
Shares of a Public
Company should
report their
shares ownership
and change in
their share
ownership of at
least 0.5% from
the Issued and
Paid-up shares of
the company to
the Financial
Services Authority
(OJK).
Must Buyer disclose information
on other activities and
directorships held by board
members, including on their
primary employment?
Yes -Click Bapepam Rule No. X.K.6 Yes Given the Buyer is
a public company,
according to
Article 4 of OJK
Rule No.
29/POJK.04/2016
on the Annual
Report of Issuer
or Public
Company and
Circular Letter of
OJK No.
30/SEOJK.04/201
6 on the Form and
Content of Annual
report of an Issuer
or Public
Company, the
Annual Report
shall consists of at
least these
following matters,
including the
good corporate
governance
principles of an
Issuer or Public
Company. This
good corporate
governance
section contains a
brief description
of biography of
every member of

20. the board of
commissioners
and board of
directors of the
issuer or public
company.
Moreover, based
on Article 15 (7)
of OJK Rule
No.32/POJK.04/20
14 on the Plan
and Conduct of
General
Meetings of
Shareholders of
a Public
Company, the
biography of
every candidate
of Board of
Directors and
Board of
Commissioners
that will be
appointed shall be
available to the
shareholder prior
to the GMS.
Must Buyer disclose on an
individual basis the compensation
of directors and high-ranking
officers, including bonuses and
incentive schemes?
Yes -Click Article 66 paragraph 2 of
the Company Law with
respect to limited
company and Bapepam
Rule X.K.6 with respect to
listed company.
Yes Given the Buyer is
a public company,
based on Article
22 of OJK Rule No.
34/POJK.04/2014
on the Committee
for the
Nomination and
Remuneration of
an Issuer or Public
Company, a public
company shall
disclose the
implementation
of relevant
functions of
nomination and
remuneration in
the annual report
and in the website
of such Issuer or
Public Company.
Moreover, based
on OJK Rule No.
29/POJK.04/2016
on the Annual
report of an Issuer
or Public

21. Company and
Circular Letter of
OJK No.
30/SEOJK.04/201
6 on the Form and
Content of Annual
report of an Issuer
or Public
Company, the
annual report
shall consists of
the procedure,
determination
basis, structure
and the amount
of remuneration
of each member
of the Board of
Directors and
Board of
Commisioners as
well as the
connection
between the
remuneration and
performance of
the Issuer or
Public Company.
Must Buyer publish the notice of
shareholder meeting 21 calendar
days in advance and include
information and deadlines on
participating and exercising
voting rights remotely?
No -Click Articles 82 (1) Company
Law with respect to limited
company and Article 10
(1) of OJK Regulation No.
32/2014 with respect to
listed company
Yes Given the Buyer is
a public company,
based on Article
13 of OJK
Regulation No.
32/POJK.04/2014
on the Plan and
Conduct of
General
Meetings of
Shareholders of
a Public
Company, the
notice of GMS
must be published
at the latest
within 14
(fourteen)
calendar days
before the date of
GMS, and the
GMS
announcement
for the meeting
must be published
at the latest
within 21 (twenty
one) calendar

22. days before the
date of GMS. This
provision has
fulfilled the
requirement
listed in the
questionnaire.
Can shareholders or members
who hold 5% of Buyer's share
capital put items on the general
meeting agenda?
Yes -Click OJK Regulation Number
32/POJK.04/2014
concerning Planning and
Implementing General
Meetings of Shareholders
of Public Companies
Article 79 (2) of the
Company Law No.
40/2007 (applicable to
non-public companies)
and Article 12 paragraph
(2) POJK 32/2
Yes In relation to a
public company,
based on Article
12 of OJK
Regulation No.
32/POJK.04/2014
on the Plan and
Conduct of
General Meetings
of Shareholders of
a Public Company,
the shareholders
representing 1/20
(5%) of the total
number of shares
with voting rights,
may propose
items on the
agenda of the
general meeting
of shareholders in
writing to the
Board of Directors
no later than
seven days before
the meeting
announcement.
Must a certified external
accountant audit Buyer's annual
financial statements?
Yes -Click Article 68 (1) of the
Company Law No.
40/2007 (applicable to
non-public companies)
and Bapepam Rule No.
X.K.6 (applicable to public
companies)
Yes Given the Buyer is
a publicly listed
company, based
on Article 68 of
Law No. 40/2007
on Limited
Liability Company,
the Board of
Directors is
obliged to submit
the Company’s
annual report to a
Public Accountant
if among others,
the Company is a
Public Company
Must Buyer disclose its audit
reports to the public?
Yes -Click Article 68 paragraph 4 of
the Company Law,
Bapepam Rule No. X.K.6,
Point 2.c of Bapepam
Rule No.X.K.2
Yes Given the Buyer is
a public company,
based on Article 4
of OJK Regulation
No.
29/POJK.04/2016

23. on Annual report
of an Issuer or
Public Company
and Circular
Letter of OJK No.
30/SEOJK.04/201
6 on the Form and
Content of Annual
report of an Issuer
or Public
Company, the
annual report
shall consists of at
least these
following matters,
including the
annual financial
report that has
been audited

24. III. Conflict of interest case study
For the following questions, in addition to previous assumptions, please assume the following:
• Mr. James owns 60% of Buyer. He sits on the 5-member board of directors (or management board)
together with 2 other directors whom he elected. He is neither CEO nor chair.
• Mr. James also owns 90% of Seller, which operates a chain of retail stores. Seller, facing financial
difficulties, closed a large number of stores and is no longer using many of its trucks.
• Mr. James proposes that Buyer purchase Seller’s unused fleet of trucks to expand Buyer’s distribution of its
products. Buyer agrees and enters into the transaction.
• All required approvals are obtained and all mandatory disclosures are made. Buyer pays Seller a cash
amount equal to 10% of Buyer’s assets to acquire the trucks.
• The transaction is part of Buyer’s ordinary course of business and is not ultra vires (i.e. is not outside the
power or authority of Buyer).
• It is subsequently discovered that the price of the trucks was above market value. The transaction
therefore causes damages to Buyer. Shareholders of Buyer want to sue Mr. James as well as board members
who voted in favor.
Who provides the final authorization before Buyer can acquire Seller's trucks? The general meeting of
shareholders excluding Mr. James
Applicable Law: Law No. 40/2007 on Company Law, Bapepam-LK Regulation No. IX.E.2, No. IX.E.1 and IX.J.1 and
Article 29 of OJK Regulation No. 32/2014
Must an independent body, external to the company, review the transaction prior to its execution (e.g.
external auditor, outside financial advisor, stock exchange or regulator)? Yes, Independent third party as
appointed or independent advisors or consultants as required by the Financial Services Authority (Otoritas Jasa
Keuangan or OJK)
Applicable Law: Bapepam Rule No. IX.E.1, Bapepam Regulation No. IX.E.1 and Bapepam-LK Regulation No. IX.E.2
What information about the Buyer-Seller transaction must Mr. James disclose to the board of directors before
the transaction is concluded? Full disclosure of all material facts regarding Mr. James’ interest in the Buyer-Seller
transaction.
Applicable Law: Bapepam Rule No. IX.E.1, article 97 Company Law
Which information about the Buyer-Seller transaction must be disclosed by Buyer to the public, the regulator
or the stock exchange immediately (within 72 hours of closing the transaction)?
Last year This year
A description of the assets purchased by Buyer Yes Yes
The nature and amount of consideration paid by Buyer to Seller Yes Yes
Mr. James’ ownership interest and/or director position in Buyer Yes Yes
The fact that Mr. James owns 90% of Seller Yes Yes
Applicable Law: CML Art. 1 and 86; Bapepam Rules No. IX.E.1 and X.K.1
Which information about the Buyer-Seller transaction must be disclosed by Buyer in its annual financial
statement?
Last year This year
A description of the assets purchased by Buyer Yes Yes
The nature and amount of consideration paid by Buyer to Seller Yes Yes
Mr. James’ ownership interest and/or director position in Buyer Yes Yes
The fact that Mr. James owns 90% of Seller Yes Yes
Applicable Law: Bapepam Rule No. X.K.6, OJK Regulation No. 31/POJK.04/2015 on the Disclosure of Information or
Material Fact by an Issuer or Public Company
Can shareholders representing 10% sue Mr. James for the losses that the transaction caused to Buyer? Yes,
directly.
Applicable Law: Article 97 section 6 of Law No. 40/2007

25. Which of the following is the least difficult to prove for shareholders and would be sufficient to hold Mr.
James liable for the damage that the transaction causes to the company? That there was a conflict of interests,
that the transaction was unfair and the transaction cause damages on the company.
Applicable Law: Articles 61, 97, 108 and 114 of Company Law
Which of the following is the least difficult to prove for shareholders and would be sufficient to hold the other
board members liable for the damage that the transaction causes to the company? That there was a conflict of
interests, that the transaction was unfair and the transaction cause damages on the company
Applicable Law: Articles 61, 97, 108 and 114 of Company Law, Bapepam-LK Regulation No. IX.E.2, No. IX.E.1
If shareholders are successful in their action(s) against Mr. James, what remedies are available?
Last year This year
He pays damages Yes Yes
He repays personal profits made from the transaction No Yes
He is disqualified from serving in the management of
any company for 1 year or more
No No
Applicable Law: Article 97.3 of Company Law Article 97.5 of Company Law
Can a court void/rescind the transaction upon a successful claim by shareholder plaintiffs (please select the
least difficult argument to prove that would likely succeed)? Shareholder(s) can challenge the transaction if the
transaction is considered to be unjust and unreasonable and has caused losses and damages.
Applicable Law: Article 61 of the Company Law
Before filing a suit, can shareholders representing 10% obtain internal company documents such as minutes
of board meetings, contracts and purchase agreements in connection with Buyer's acquisition of the trucks?
Yes, both directly and through an investigator.
Applicable Law: Article 138 and 139 of Company Law
In a civil trial, what is the scope of information that the plaintiff can ask the judge to compel?
From the defendant: any information that is relevant to the subject matter of the claim
From an uncooperative witness: any information that is relevant to the subject matter of the claim Applicable Law:
Civil Procedural Law Article 163 HIR, Article 137 of Herzien Inlandsch Reglement (Indonesian Civil Procedural Law)
How specific must the plaintiff’s request to the judge be to compel evidence from a defendant or witness in a
civil trial? The request need only identify categories of documents sought, without specifics.
Applicable Law: Article 137 of Herzien Inlandsch Reglement (Indonesian Civil Procedural Law)
Which statements best describe the process of questioning defendants and witnesses in civil trials?
From the defendant: The plaintiff or plaintiff’s lawyer performs his own questioning with prior approval by the
Court of the question posed.
From an uncooperative witness: The plaintiff or plaintiff’s lawyer performs his own questioning with prior approval
by the Court of the question posed.
Applicable Law: Article179 of Civil Procedure Code, Article 150 of Herzien Inlandsch Reglement (Indonesian Civil
Procedural Law)
Must the company or defendants reimburse the legal expenses (e.g., court fees, attorney fees and related
expenses) of shareholders in their action against company directors? Yes, but only if successful
According to Article 178 of Herzien Inlandsch Reglement (Indonesian Civil Procedural Law), Judges are obliged to
adjudicate all parts of the claim and to render decision based on what is claimed by the Plaintiff. Therefore, if the
Plaintiff files the lawsuit in order to recover their legal expenses and the Court grants such claim, the Plaintiff is
entitled to such expenses in accordance with the Court decision.