INDONESIA Law and Practice Contributed by: Ira A Eddymurthy and A Charlie R Malessy, SSEK Law Firm
company’s management as they will be able to decide corporate actions taken by the compa - ny, including mergers and acquisitions, capital injection and the dissolution of the company. 5.3 Shareholder Meetings In general, the GMS of Indonesian private com - panies is extensively regulated under the Com - pany Law. The GMS consists of an annual GMS and any other GMS that may be held at any time depend - ing on the needs of the company. The latter is also known as an extraordinary GMS. The annual GMS must be held by no later than six months after the closing of each fiscal year. At the annual GMS, the BOD is required to submit the annual report of the company for approval, and shareholders may also ask for other items to be placed on the agenda for discussion at the annual GMS, such as the appointment or dismissal of members of the BOD or BOC, and the distribution of annual dividends. Note that the Company Law regulates the rele - vant procedures and guidance for an annual and extraordinary GMS to ensure they are the same. Procedure for GMS Company Law provides that the BOD shall hold the GMS after a notice for such has been dis - tributed to shareholders. The BOD can issue a notice for a GMS on its own authority or because one or more shareholders who collectively repre - sent one-tenth or more of total shares with vot- ing rights or the BOC has/have requested the BOD to convene a GMS. Such request shall be submitted to the BOD by registered mail, accompanied by the reason for the request. If the BOD does not give the notice of GMS within 15 days after the date of
the request to convene the GMS is received, the following applies. • In the case of shareholders, such sharehold - ers may re-submit the request for the GMS to the BOC. The BOC is required to give notice of the GMS within 15 days as of the date the request to convene the GMS is received. The shareholders that request the GMS can issue the notice for GMS based on a stipulation of the chairperson of the district court with juris - diction over the company if the BOD or BOC does not issue the notice of the GMS. • In the case of the BOC, they may themselves give notice of the GMS to shareholders. For a notice for a GMS to be valid, it must include the date, time, venue and agenda of the meet - ing, and must be accompanied by a note that the materials to be discussed in the GMS are available at the company’s office as of the date of the notice of the GMS until the date the GMS is convened. Further, a notice of a GMS must be sent no later than 14 days prior to the convening thereof, excluding the date of the notice and the date of the GMS, in the form of a registered let - ter or through an advertisement in a newspaper. If all shareholders attend the GMS, then the notice requirement may be waived by a share - holders’ resolution passed at the GMS, in which case the GMS may be held at any time without notice. Representation of Shareholders The Company Law allows for shareholders to be represented in the GMS by a representa - tive appointed by a valid power of attorney. The power of attorney must be in Indonesian, although it can be made in bilingual format if the parties deem it necessary. If executed outside Indonesia, Indonesian practice requires that the
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