JAKARTA (TheInsiderStories) - Indonesia Stock Exchange (IDX) is drafting a new regulations fro the issuers that have plan to increase the share through a free float shares, said the director today. The initiatives is part of the regulator effort to encourage them to comply the regulation and to increase capital market liquidity.
The free float provision is based on the Decree of the IDX directors Kep-00183/BEI/12-2018 concerning Listing of Shares and Equity Securities Other Than Shares Issued by Listed Companies. The regulation was published on Dec. 26, 2018 and took effect from Dec. 27, 2018.
“We want to encourage issuers to increase their free float portion rather than just fulfilling the current minimum obligations,” said the director, Hasan Fawzi, during a virtual press conference on Friday (10/30), by adding the self regulatory organization is also preparing new regulations regarding the reduction of the annual listing fee and a tax cut.
Last June, IDX announced there are 18 issuers had the potential to forced delisting from the stock exchange for various reasons, including not met the free float requirements. The two issuers are the flight carrier PT AirAsia Indonesia Tbk (IDX: CMPP) and coal miner PT Golden Energy Mines Tbk (IDX: GEMS).
He stated, the issuers only get incentives if releases at least 40 percent of the outstanding shares. Incentives are given in the form of corporate income tax deduction by 3 percent.
This provision is contained in Government Regulation Number 30 of 2020 concerning the Reduction of Income Tax Rates for Domestic Corporate Taxpayers in the Form of Public Companies. in the decree, which was enacted on June 19, 2020, has also adopted by the Omnibus Law for Job Creation, which was passed by the parliament on Oct. 5.
Based on the free float rule, it stated that listed companies can remain listing on the stock exchange if the number of shares owned by non-controlling shareholders reaches a minimum of 50 million shares and a minimum of 7.5 percent of the total shares in paid-up capital for public.
In addition, the number of shareholders must be a minimum of 300 account holders. The authority has given the issuer a maximum two years period since 2018 to comply the regulation.
Written by Editorial Staff, Email: theinsiderstories@gmail.com
