SUMMARY
OF REGULATION OF BANK INDONESIA
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Regulation
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Circular Letter of Bank
Indonesia No. 18/42/DKSP on Non-Bank Foreign Exchange Business
Activities
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Effective Date
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From 30 December 2016
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Summary
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1. This
Circular Letter is issued by considering that it is necessary to stipulate
implementing provisions for Regulation of Bank Indonesia Number 18/20/PBI/2016 on
Non-Bank Foreign Exchange Business Activities.
2. This
Circular Letter stipulates the following:
a.
settlement of buying and selling of foreign banknotes against Rupiah;
b.
criteria for buying foreign banknotes with documents for underlying
transactions;
c.
restriction for Money Changers to impose any fees in buying and selling foreign
banknotes from and to Customers;
d.
procedures for handling and settlement of Customer’s complaints;
e.
document requirements and procedures for license application as a Money Changer;
f.
license validity and procedures for license validity extension application;
g.
training or certification materials for the Board of Directors;
h.
inclusion of logo, certificate, and trade name;
i.
process of branch office and counter opening, change of address, and branch
office closing;
j.
termination of business activities;
k.
procedures for implementation of cooperation with any parties other than Money
Changers; and
l.
requirements for selling and buying foreign banknotes in border areas.
3. Money
Changers must apply the following principles in customer protection: fairness
and reliability, transparency, protection of customer’s data and/or
information, and effective handling and settlement of customer’s complaints.
4. Bank
Indonesia takes the following phases in license grant processing:
a.
examination of fulfillment of institutional requirements and financial
condition;
b.
examination of fulfillment of requirements as members of the Board of
Directors, members of the Board of Commissioners, and shareholders of prospective
Money Changers;
c.
examination of business premises of Money Changers; and
d.
dissemination of provisions.
5. Upon
obtaining their licenses, Money Changers must carry on their business
activities within 30 (thirty) days as of the notice date.
6. License
as a Money Changer is valid for 5 (five) years as of the license grant date and
may be extended by submitting an application to Bank Indonesia.
7. Bank
Indonesia may revoke the business license as a Money Changer if:
a.
the Money Changer is no longer in operation or conducting any business
activities;
b.
the Money Changer no longer has active and responsible management; and/or
c.
the Money Changers changes their business address without the approval of Bank
Indonesia.
8. In the
event of any change of members of the Board of Directors, members of the Board
of Commissioners, and/or shareholders, the replacement candidates must obtain
prior approval of Bank Indonesia.
9. Members
of the Board of Directors of Money Changers must attend any
training/certification program supporting the implementation of Non-Bank Foreign
Exchange Business Activities; among others are materials on Anti-Money
Laundering and Prevention of Terrorism Funding, financial (business)
management, general management, risk management, or any other materials
relating to foreign exchange business activities.
10. In carrying on
their business activities, a Money Changer must include:
a.
logo of authorized Money Changer;
b.
business license certificate issued by Bank Indonesia; and
c.
signage bearing ”Authorized Money Changer”, company name, trade name, and the
number and date of Business License Grant Decision.
11. Any Money
Changers intending to open their branch office must carry on their business
activities for at least 2 (two) years as of the license issuance date and meet
the requirements for paid-up capital.
12. Counters may be
opened in order to support certain activities, such as international fairs or
activities, in the headquarters and/or branch office areas of the relevant Money
Changers and may be conducted for 1 (one) month at the maximum and may be
extended 1 (one) time only.
13. Money Changers
must submit the following reports to Bank Indonesia:
a.
Periodic Reports, consisting of:
1)
Business Activity Report
Business Activity Report
means report on selling and buying of foreign banknotes and purchase of
traveler’s checks; and
2)
Financial Statement
Financial Statement means
Balance Sheet (Financial Statement), Income Statement, and Equity Statement at
the end of the year.
b.
Incidental Reports, consisting of:
1)
report on appointment of the Board of Directors, Board of Commissioners, and/or
change of shareholders;
2)
report on participation of members of the Board of Directors in
training/certification;
3)
report on branch office opening;
4)
report on counter opening;
5)
report on change of office address;
6)
report on change of Limited Liability Company’s name;
7)
report of change of subscribed capital and/or paid-up capital;
8)
report on problems in foreign exchange business activities, including the
mitigation efforts;
9)
report of force majeure, which means any events beyond the control of a Money
Changer resulting in the failure in carrying on business activities, the events
of which include but not limited to fire, riot, sabotage, and natural
disasters, such as earthquake and floods, declared by the local authority or
competent official, including Bank Indonesia;
10) report
on cooperation with hotels or companies similar to hotels; and
11) other
reports, which may be requested at any time by Bank Indonesia, such as report
on foreign exchange rate on a certain date, report on a certain financial
transaction, and report on cooperation plan.
14. Bank Indonesia supervises
Money Changers directly by examining their business activities in order to
examine and evaluate their compliance with the regulations, and indirectly by
monitoring and analyzing reports they submit and information from other parties.
15. Money Changers
may cooperate with any parties other than Money Changers (hotels or companies
of accommodation services) to buy foreign banknotes with the approval of Bank
Indonesia.
16. Any parties other
than Money Changers, which sell and buy foreign banknotes in border areas, must
be companies carrying on their business activities in border areas of Indonesia
and must obtain prior approval of Bank Indonesia.
17. Any Money
Changers in breach of the provisions in this Circular Letter will be imposed
with the following administrative sanctions:
a.
written warning;
b.
mandatory payment;
c.
termination of business activities; and/or
d.
license revocation.
18. This Circular
Letter starts to take effect from 30 December 2016.
