The Capital Market and Financial Institution Supervisory Agency (Bapepam-LK) has almost finalized its draft of a bill to amend the 1995 Capital Markets Law, which is to be submitted to the House of Representatives for deliberation, The Jakarta Globe reported.
“The revisions are 90% ready,” Bapepam chairman Fuad Rachmany said on Tuesday. The issues covered include demutualization and immunity for regulators for actions undertaken in the course of their duties. The amendments are needed to allow the demutualization of the Indonesia Stock Exchange (IDX) to go ahead, a key step forward in the bourse’s plans to go public. As per the current legislation, the IDX is owned by 119 securities houses, each of which has an equal voting right.
The demutualization plan would allow the exchange to raise funds from the public to press ahead with its modernization program and help expand the domestic capital market, and is in line with the trend among bourses around the world. The proposed amendments would provide immunity from legal action for regulators with respect to bona fide actions taken in the course of their work.
“Immunity does not mean we’re above the law, but it will make our job much easier,” Rachmany said, adding that the measure would significantly ease the agency’s investigative process.
Regarding the establishment of a proposed financial services authority to take over the regulatory powers of Bapepam and the central bank, part of the package of bills to be submitted to the new House, Rachmany said more work was needed.
Source: Indonesia Trade & Inv News-21 July 2009