Article on confiscation to be applied in the Law on Capital Market

as published in Bisnis Indonesia daily newspaper

Saturday, 23/01/2010 00:00 WIB

Article on confiscation to be applied in the Law on Capital Market

JAKARTA: The Capital Market and Finance Institutions Supervisory Agency (Badan Pengawas Pasar Modal dan Lembaga Keuangan/Bapepam-LK) plans to include the clause on asset confiscation from the bourse convict in the amendment of law on capital market.

The authority of capital market regretted the poor sanction given by court to some violators by simply demanding the graft fund without asset confiscation as part of their responsibility.

Chief of Bapepam-LK Fuad Rahmany said the capital market crime sanction referring to the Code of Crime fails to give deterrent effect to the convicts.

"There is convict who is simply sentenced 18 months without any confiscation. We will change this. We want to impose higher sanction to the capital market crime. Is it possible the court verdict refers to the capital market law here," he said yesterday.

Fuad admitted the weak sanction mechanism to the capital market violator is due to the less rigid sanction regulation for the perpetrator that had been brought to court.

The amendment is expectedly included in the capital market law revision by Bapepam-LK so as to minimize crime in the capital market.

"We will later make it more detail. It is not only harsh sanction but also the confiscation of the perpetrator assets under the capital market Law. Now, the Law does not stipulate any asset confiscation clause but rather from the other Law."

But Fuad could not set any target of the revision of Law on capital market.

"Just wait and see. We don't know when it finishes but the preparation is underway."

Bapepam also plans to have regulation on cross border offering in the prospectus regulation scheme in the IPO.

Based on the issued regulation draft this week, the capital market authority has designed the early reference for the domestic emitter planning for stock listing in the Asean. The regulation also enables overseas emitter to list it in the Indonesian bourse.

Some clauses in the regulation here include the transparence addressed on the rights issue, dissenting offering price and stock book value, and exchange rate. (Bisnis/ags/iaa)