Shareholders in JSX subordinate to government<\/p>\n
JAKARTA (JP): Those holding shares in PT Bursa Efek Jakarta,
\nalso known as the Jakarta Stock Exchange (JSX), must understand
\nthat the JSX is an unusual limited liability company, over which
\nthe government has the highest authority and not the
\nshareholders, said House member SGB Tampubolon.<\/p>\n
To support his conclusion, Tampubolon referred to a recent
\nregulation issued by Indonesia's Capital Market Supervisory
\nAgency (Bapepam), a statutory government body, allowing the
\ngovernment to appoint the JSX's new directors and commissioners.<\/p>\n
In a normal limited liability company, it is the shareholders,
\nas the highest authority, who call for the election of new
\ndirectors or commissioners.<\/p>\n
Tampubolon told The Jakarta Post on Saturday that the new
\ncapital market law not only strengthens the government's
\nauthority over the country's stock exchanges but exempts the
\nexchanges from Law No.5\/1995 regarding limited liability
\ncompanies.<\/p>\n
"While deliberating the capital market bill last year, we
\nraised questions about the extent of the government's authority
\nover the stock exchanges, including the stipulations that empower
\nthe government to "select" the exchanges' directors and
\ncommissioners," he said.<\/p>\n
The Indonesian Democratic Party (PDI) faction, according to
\nTampubolon, was not comfortable with the term "select", which
\neffectively ruled out the possibility of any PDI members becoming
\nexchange directors.<\/p>\n
"But we ultimately accepted the formulation as the finance
\nminister argued that the law will allow the government to protect
\nthe interests of both the exchange's shareholders as well as the
\npublic's.<\/p>\n
"So I would say that if Bapepam is now preparing another
\nelection of JSX directors, it must be for the benefit of the
\nshareholders and the public," he said.<\/p>\n
Many people, he said, would like to hold positions in the JSX
\nmanagement and on its board of commissioners.<\/p>\n
An executive at a local securities firm, JA Sereh, said the
\nnew JSX president is likely to be a government official.<\/p>\n
"Most JSX members expect a president who will be acceptable to
\nthe government," Sereh said.<\/p>\n
Sereh, a retired commissioner of the former over the counter
\nmarket, told the Post over the weekend that having a good rapport
\nwith the government will allow the exchange's president to
\nfulfill the shareholders' expectations which sometimes require
\nthe government's approval for their realization.<\/p>\n
"Rumor has it that some Bapepam officials might be nominated,"
\nhe said.<\/p>\n
He argued, however, that with the increase of foreign
\nbrokerages operating on the stock exchange, the market needs a
\nprofessional with a sound understanding of the stock market
\nmechanism.<\/p>\n
"It would be dangerous to find out later that the management
\ncannot keep pace with market developments," he said, adding that
\nforeigners will continue to dominate trading on the JSX for the
\nforeseeable future.<\/p>\n
Sources at the exchange confirmed that Bapepam has instructed
\nthe JSX to conduct a general shareholders meeting on April 15 to
\nelect new directors and commissioners.<\/p>\n
There will be an extraordinary meeting prior to the general
\nshareholders meeting. The meeting is expected to approve a new
\nstatute of the JSX to comply with the new capital market law.<\/p>\n
In line with the new procedures for nominating directors and
\ncommissioners, Bapepam has also determined the following
\nguidelines:<\/p>\n
* To make a nomination the shareholder must have a minimum of
\n0.2 percent of the total trading value and frequency recorded in
\nthe previous twelve months (March 1, 1995 to Feb. 29, 1996).<\/p>\n
* JSX shareholders who qualify must submit the names of their
\ncandidates to Bapepam on March 25.<\/p>\n
Bapepam will announce which candidates have been approved on
\nApril 8 and notify all JSX members of the names by April 11. (08)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/shareholders-in-jsx-subordinate-to-government-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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