JSX announces new listing regulations

Zakki P. Hakim, Jakarta

The Jakarta Stock Exchange (JSX) announced on Thursday changes in its listing regulations, which provide tougher sanctions for companies failing to submit their audited financial reports on time.

JSX president Erry Firmansyah told a press conference that the maximum penalty for late submission of financial reports has been increased to Rp 500 million (US$55,500), compared to only Rp 10 million under the current regulation.

While the new sanctions will be effective on Oct. 1, the revision to the other parts of the listing regulations will be effective as of Monday. The full copy of the revised regulations will be issued to the press on Monday.

The move came amid a growing number of listed companies failing to submit their audited financial reports on time, which has created new uncertainty for investors in the local stock market.

Erry explained that under the revised regulation, the bourse will first issue a warning letter to companies that fail to submit their financial accounts by the deadline. There will be a Rp 1 million fine for each day the submission is delayed.

A second warning letter plus a Rp 50 million penalty will follow after a 30-day delay, and a third warning letter plus a Rp 150 million penalty will be imposed for another 30-day delay.

The exchange would then consider imposing the maximum fine of Rp 500 million if the company in question still has not submitted the financial report. This will be followed with suspension in the trading of the shares of the companies.

"We sincerely hope that companies do not find themselves in such a situation," Erry said.

The JSX has previously threatened to delist or suspend 35 firms including blue chip telecommunications company PT Telekomunikasi Indonesia (Telkom), cement giant PT Semen Gresik, and tire maker PT Gajah Tunggal for failing to submit their audited 2003 financial reports by the deadline.

The three companies, however, eventually managed to submit the reports.

However, until now four firms have not filed the reports, thus facing the risk of being delisting from the bourse. The companies are PT Wahana Jaya Perkasa, PT Siwani Makmur, PT Bukaka Teknik Utama and PT Texmaco Perkasa Engineering.

Meanwhile, JSX listing director Harry Wiguna said that under the revised regulation, a particular company would be delisted if its shares had been suspended for 24 consecutive months, or if the firm is considered to no longer have prospects as a going concern such as in the case of bankruptcy or closure.

In the case of voluntary delisting, at least two-thirds of a firm's shareholders must agree on the action and the firm must have already been listed in the bourse for at least five years.

Companies could re-enter the bourse (relisting) within six months after being delisted, while the original regulation required a five to 10 year interval, Harry said.

Harry further said that the revision to the regulations also covered the area of determining share price in the case of share buy back.

Zulfikar, a stock market analyst at Mandiri Sekuritas, said that the revision was a good step in a bid to help protect the interests of investors.