The Implementation Procedure of Principle to Recognize a Beneficial Owner of a Corporation

Background

On 13 June 2019, the government enacted the Regulation of Minister of Law and Human Rights Number 15/2019 on Implementation Procedure of Principle to Recognize a Beneficial Owners of a Corporation (“Permenkumham 15/2019”)

Permenkumham 15/2019 sets guidelines and mechanisms for implementation and performance to obtain information concerning beneficial owner of a corporation.

Beneficial owner means individual that may appoint or dismiss board of directors, board of commissioners, manager, facilitator or supervisor in corporation, has capabilities to control corporation, to receive benefit from corporation whether directly or indirectly, is the real owner of funds or corporate shares and/or qualified for criteria as intended with laws.

Qualification of Beneficial Owner

The beneficial owner consists of:

  1. General qualification; and
  2. Definite qualification.

General qualification, is the individual that:

  1. Is entitled to appoint or dismiss board of directors, board of commissioners, manager, facilitator or supervisor in corporation/active shareholder company and passive to the corporation;
  2. has capabilities to control the corporation;
  3. is entitled to and/or receive benefit from corporation whether directly or indirectly; and/or
  4. the actual owner of funds or corporation’s shares.

The beneficial owner of corporation that includes to the general qualification is:

  1. his/her identity is listed under the deed of establishment/deed of amendment from corporation or other document of establishment/document of amendment from corporation (legal owner); and
  2. his/her identity is not listed under the deed of establishment/deed of amendment of corporation or other document of establishment/document of amendment of corporation (ultimate beneficial owner).

Definite qualification

is an individual qualified for criteria as intended under the Presidential Regulation No. 13/2018 on Implementation of Recognizing Principle of Beneficial Owner from Corporation in the Framework of Deterrence and Eradication of Criminal Acts of Money Laundering and Acts of Terrorism Financing.

The beneficial owner of a corporation included as definite qualification is an individual which:

  1. his/her identity is listed under the deed of establishment/deed of amendment of corporation or other document of establishment/document of amendment from corporation (legal owner); and
  2. his/her identity is not listed under the deed of establishment/deed of amendment from corporation or other document of establishment/document of amendment from corporation (ultimate beneficial owner).

Stipulation of Beneficial Owner of Corporation

Each corporation must stipulate beneficial owner of corporation that has been done through principle implementation to recognize the beneficial owner of a corporation. Corporation as mentioned above consists of:

  1. limited liability company;
  2. foundation;
  3. association;
  4. cooperative;
  5. limited partnership; and
  6. firm partnership.

Beneficial owner of a corporation shall be at least 1 (one) personnel.

Information Submission of Beneficial Owner of a Corporation

Corporation must submit a true information concerning the beneficial owner of a corporation to Minister of Law and Human Rights. The information submission of beneficial owner of a corporation includes:

  1. The submission of information of beneficial owner on the establishment application, registration and/or legalization of corporation; The information submission of beneficial owner in this phase is conducted by the notary.
  2. The submission of information of beneficial owner by the time the corporation is conducting its business or activities.
    The information submission of beneficial owner in this phase is conducted by:

    1. notary;
    2. founder or manager of corporation; or
    3. other party assigned by founder or manager of corporation.

The information submission of beneficial owner from corporation is conducted electronically through AHU online.

Submission of Latest Information of Beneficial Owner of a Corporation

The submission of latest information of beneficial owner of a corporation is conducted by:

  1. notary;
  2. founder or manager of corporation; or
  3. other party that assigned by founder or manager of corporation.

If there is an update of information of beneficial owner, corporation must submit that newest information to Minister of Law and Human Rights. The submission of latest information of beneficial owner from corporation is conducted periodically every 1 (one) year. The submission of latest information of beneficial owner of a corporation is conducted electronically.

Infomation Exchange of Beneficial Owner of a Corporation

The Minister of Law and Human Rights may conduct cooperation to exchange information of beneficial owner with the requesting institution. The information exchange is conducted electronically. The information exchange of beneficial owner is conducted through providing access right to requesting institution and reporter.

Each person may request information of beneficial owner to the Minister of Law and Human Rights.The request of information concerning beneficial owner of a corporation is determined by Minister of Law and Human Rights in accordance with laws.

Supervision

Supervision of the implementation to recognize the beneficial owner is conducted by Minister of Law and Human Rights through Director General. Supervision is conducting in the shape of:

  • stipulating regulation or guideline according to their jurisdiction;
  • conducting audit to corporation; and/or
  • arranging other administrative activities within the scope of their duties and responsibilities.

If there is a violation over this principle, the Minister of Law and Human Rights through Director General may imposed sanctions in accordance with laws.


Muhammad Haris Fadillah

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