TAXES
LAW
6
Luther LLP in collaboration with Maqdir Ismail & Partners
Administrative and Criminal
Liability in Case of Non-
Compliance
BPJS Ketenagakerjaan - Newcomers
with Golden Achievements in the
Investment Sector
T
his brief overview shall discuss the potential liability of a
company, its management and its shareholders for non-
compliant actions of the company. especially for the two
non-civil types of liability: (a) administrative liability, resulting in
sanctions such as the revocation of a business license or payment
of fines to government agencies, and (b) criminal liability, resulting in
imprisonment/payment of fines to the state treasury.
Under several Indonesian laws and regulations, a company may be
subject to criminal sanctions. This includes e.g. the Anti-Corruption
Law, the Anti-Money Laundering Law and the Environmental Law.
While these laws foresee the criminal liability of a company, in
practice criminal prosecution of companies is rarely seen.
Companies are however given administrative sanctions for non-
compliance with a legal or regulatory requirements on a regular
basis. Such sanctions will impede or stop business operations and
include suspension or revocation of business licenses, withdrawals
of goods/services from the market or exclusion from government
tenders. In a typical procedure the company will first receive
warning letters from the relevant government authority before actual
sanctions are imposed.
In performing its duties, the Board of Directors (BoD) and its individual
members are jointly and/or severally empowered to represent the
company according to the respective articles of association (AoA).
S
ocial Security Administration Body for Employment or BPJS
Ketenagakerjaan (BPJSTK) was established in 1 July 2015
pursuant to Law number 24 of 2011 on National Social
Security Agencies. As the successor to the previous agency
Jamsostek, BPJSTK has a motto of “Being the Bridge towards
Workers Welfare”. Contribution to BPJSTK is made mandatory not
only for Indonesian workers but also foreign workers working for at
least 6 months in Indonesia. BPTJSK offers 6 programs; provident
fund benefit, work related accident benefit, death benefit, pension
benefit, construction service and non-wage earner, and it also
creates a social security scheme paid with contributions from both
employers and employees.
The issuance of OJK Regulation No. 1/POJK.05/2016 on the
Investment in Government Securities by Non-Bank Financial
Services Institutions create obligations for BPJSTK to place
investment in state securities. Article 2 (e) of the regulation
Investment in BPJS
Further, directors may grant powers of attorney in order to delegate
their authority. In doing so, directors remain legally responsible for
actions of the persons given power of attorney. In order to limit
such exposure, powers of attorney are usually specific in nature.
Directors can be held personally responsible or prosecuted for non-
compliance with relevant laws and regulations if the respective
sanctions provide for that. This is the case e.g. in the Anti Money
Laundering and Anti-Corruption laws. Depending on the wording
and interpretation of the specific regulation, the “management” of
a company may include a company’s board of commissioners in
addition to the BoD.
In terms of responsibility, the general provisions on the responsibility
of directors under the Company Law provide some guidance
although these may be applied stricter in terms of administrative
and criminal liabilities. According to the Company Law, directors will
not be held personally liable if they can prove that: (i) losses were
not the result of their negligence; (ii) they managed the company
prudently, in good faith and in the interests of the company; (iii)
losses were not due to conflicts of interests which affected their
managerial responsibilities; and (iv) they took action to prevent said
losses from occurring and continuing.
requires BPJSTK to invest at least 50% of the the whole of the Social
Security Guarantee Fund and at least 30% of the total investment
by BPJSTK in government securities no later than 31 December
2016. The principle of prudence must be applied in every decision
to invest.
According to the Director of Investment Development of BPJSTK
Mr. Amran Nasution, until 2017 BPJSTK has made investments
in several investment sectors; 52% in government, 9% in bonds of
state-owned enterprises (BUMN), 1% in private corporate bonds,
16% in shares, 14% in deposits, 7% in mutual funds (reksadana),
and 1% in direct investment. The agency’s mid-year report shows
that it managed IDR 293 trillion of funds from January 2017 to
June 2017, with approximately 24 million registered members. In
2016, BPJSTK gained investment returns of IDR 22,55 trillion and
this year, they initially set up a target of IDR 24 trillion which was
raised to IDR 27 trillion.
Philipp Kersting
Senior Associate
+62 21 3911191
Made Sita Lokitasari
Associate at Maqdir Ismail & Partners
+62 21 3911191
Compliance
8
th
Edition | December 2017
