The Financial Services Authority (Otoritas Jasa Keuangan – “OJK”) is currently preparing and promoting the Draft Regulation (“Draft Regulation”) on Organizers of Aggregations of Financial Services (Penyelenggara Agregasi Jasa Keuangan – “PAJK”) which, among other goals, is aiming to strengthen the supervision of aggregations of financial services, an area which has been developing rapidly due to the increasing use of new technologies within the financial sector.[1] Once the Draft Regulation comes into force, it will set out a clear framework for relevant stakeholders who provide comparison platforms and distribute financial products, and will also strengthen supervision of consumer data protection.[2]

In terms of its content, the Draft Regulation features 41 articles spanning ten chapters that are summarized in this edition of Indonesian Legal Brief, with a specific focus on the following matters:

1. PAJK: Business Activities, Entities and Capital;
2. Submission of Permit Applications; and
3. Organization of Aggregation.

PAJK: Business Activities, Entities and Capital

The following table breaks down the scope of the various business activities that PAJK may engage in, aggregation activities (which are exempted for PAJK) and aggregations that can be carried out by PAJK:

It should be noted that any PAJK that aggregate information on financial service products and/or services and that require permits or approvals to be granted through other OJK sectors will be subject to various provisions, as set out under relevant Laws and Regulations.[6] Any non-compliance with this mandate will result in the imposition of administrative sanctions.[7]

Furthermore, all parties that organize aggregations are first required to secure business permits from the OJK, while all such PAJK must take the form of limited-liability companies. In addition, prior to establishing any PAJK, paid-up capital amounting to a minimum of Rp. 2.5 billion is required (or may be stipulated by the OJK under certain conditions).[8]

Submission of Permit Applications

The procedure for the submission of permit applications includes the submission of various required documents by relevant stakeholders and, in brief, breaks down as follows:[9]

Any PAJK that have already secured business permits from the OJK will then be required to submit applications to register as electronic system organizers (penyelenggara system elektronik – “PSE”) with the relevant institutions (with a copy also being sent to the OJK) within 30 days of the issuance of said business permits. A PAJK must secure a registered mark (tanda terdaftar) for a PSE within 60 days of the issuance of its business permit. This registered mark must be submitted to the OJK within seven days of the date of the relevant registered mark for a PSE letter. Moreover, a PAJK must commence aggregation operations within 30 days of their registering as PSE.[10]

Organization of Aggregation

PAJK are required to cooperate with LJK and/or Relevant Parties during the implementation of aggregation activities, this cooperation should be set out in agreements that incorporate seven types of information at the least, including: 1) Period of agreement; 2) Tasks and responsibilities of each party; 3) Mechanisms for: a) changes to product information and/or financial services; b) distribution of financial products and/or services (if any); c) exchanges and uses of consumer data (if any).[11]

During the implementation of any aggregation activities, relevant PAJK applications and/or websites must provide the following types of information at the least: 1) PAJK profile; 2) Comparative information or information synergy on financial products and/or services; 3) Disclaimer affirming that the relevant financial services products and/or services being offered are not products issued by the PAJK and that the PAJK is not responsible for any claims and risks that relate to LJK products, services and/or Relevant Parties; and so forth.[12]

Finally, various measures are prohibited from being carried out by PAJK, including the following:[13]

1. Activities that relate to fundraising, fund savings and/or the management of consumer funds;
2. Provision of aggregation services in the form of user-generated content platforms or the copying of content without engaging in cooperation with LJK and/or Relevant Parties;
3. Leaking and/or misuse of any personal data and/or other data of consumers in an unauthorized manner.

Key Takeaways

Once the Draft Regulation comes into force, it will introduce a clear framework for relevant stakeholders who offer comparison platforms and distribute financial products, as well as strengthen the overall supervision of consumer data protection. As this new legal framework for PAJK is set for imminent promulgation, relevant stakeholders would be best advised to familiarize themselves with the various requirements, mandates, prohibitions and sanctions addressed therein.

Source: hukumonline.com