New corporate law needs conformity
New corporate law needs conformity
JAKARTA (JP): An official warned yesterday that the draft on
corporate law related to limited companies should be in
conformity with the draft on the capital market law, which will
be submitted to the House of Representatives (DPR) later this
year.
Bacelius Ruru, the chairman of the Capital Market Supervisory
Agency (Bapepam), told the House's special committee for the
deliberation of corporate law that the two laws should
accommodate one another.
The draft on limited companies was proposed to the House two
months ago.
Conformity between the laws are essential, he said, because
most of the companies listing shares or bonds on the capital
market -- as well as those operating as securities firms and
stock traders -- are all limited companies.
The House's special committee is now deliberating the draft of
corporate law proposed by the government. The operation of a
limited company is now regulated by the commercial law adopted
from the business act introduced by the Dutch government during
the colonial era.
According to the Bapepam chairman, the draft on limited
companies contains a number of breakthroughs covering important
aspects of business activities which are not stipulated in the
present commercial law. The improvements include the
clarification of the fiduciary duties of a board of directors and
the derivative actions of shareholders.
Ruru, the former head of the Finance Ministry's public
relations and law affairs department, said that the proposed law
has also covered many aspects of the operations of a company,
ranging from the procedures for starting a business to the
process of liquidation.
He said the draft on the corporate law also includes terms and
conditions of shareholder meetings and regulations regarding
boards of directors and commissioners.
Ruru reminded the committee that the draft on limited
companies should not restrict Bapepam's activities as a
regulatory and supervisory agency. He said that regulations on
activities related to capital markets, would be set by the
capital market law which is now being prepared. (hen)