New Mechanism for Securing Principal Approval for Stock Split and Reverse Stock Split Introduced

In 2022, the Financial Services Authority (Otoritas Jasa Keuangan – “OJK”) issued Regulation No. 15/POJK.04/2022 on Stock Splits and Reverse Stock Splits by Public Companies (“Regulation 15/2022”)[1]  which, as its title suggests, outlines various requirements and obligations that have to be met by public companies in order to engage in stock splits and reverse stock splits in relation to any of said public companies’ stocks that fall under the same stock classification.[2] In this regard, Regulation 15/2022 mandated that public companies must first secure principle approvals for stock splits and reverse stock splits (collectively referred to as “Principle Approvals”) from the relevant stock exchange at which the public company’s stock is listed.[3]