BUSINESS LAW REVIEW: VOLUME ONE

DEMUTUALIZATION OF AS A STRATEGIC MEASURE AND A MEANS TO IMPROVE EFFICIENT TRADING Created by: Achmad Ragil Dion Kusuma

Abstract The purpose of establishment of is to run the securities trading which orderly, fair and efficient. The demand for the implementation of good corporate governance is one of the issues to attract the interest of potential investor on capital market in a state. Driven from article 8 of law number 8 of 1995 that the member of Indonesia Stock Exchange is also the shareholder of the stock exchange. By that, many possibilities of problems may occur such as crime in the form of fraud, manipulation of market, and insider trading. The problem statements are: Has the structure of Indonesia Stock Exchange nowadays implemented the Good Corporate Governance principles in order to create orderly, fair and efficient trading exchange?; Why is demutualization necessary by Indonesia Stock Exchange to create orderly, fair and efficient trading exchange?. The result of this research shows that the implementation of good corporate governance principle is not well implemented yet due to the conflict of interest between existing structure owners and the legal status of Indonesia Stock Exchange is not in accordance with the Law Number 40 of 2007 about Indonesia Limited Liability Company Law. And demutualization is considered as a solution to increase the quality of corporate governance, for instance, in the issue of conflict of interest by separating the ownership from the membership and trading rights so that it can lead into proper running of the stock exchanges which is orderly, fair and efficient trading. This research recommends the amendment of article 8 of Law Number 8 of 1995, and conducting the demutualization in the form of establishing a holding company.

Keywords: Demutualization, Indonesia Stock Exchange, orderly fair and efficient trading. A. Background markets consist mainly equity and The capital market1 plays debt instrument, it provides an avenue significant role in the national for raising the financial needs of economy. It mobilizes funds from business through equity and long- people for further investments in the term debt by attracting investors with productive channels of economy, kinds of investments3. activating idle monetary resources and put them in proper investments2. Capital market unites the fund suppliers with the fund users in the purpose of middle-term investment and long-term investment. Capital

1 According to Rosenberg: Capital Market is 2http://www.finance.gov.pk/survey/chapter_ “the place through which the buying and 12/06-CapitalMarkets.pdf page 81 accessed selling of stock for the purpose of profit for on 22nd October 2015 at 10.23pm. both buyers and sellers of the security take 3 Supra note at 2, p. 81. place”.

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Stock exchanges are pillars of a as promissory notes, commercial nation’s economy4. Stock exchange5 paper, shares, bonds, evidences of have been viewed as an important indebtedness, mutual fund of catalyst of economic growth. They collective investment contracts, provide an organized market for the futures contracts related to securities trading of securities to individuals and and all derivatives10 of securities11. organizations which intend to invest The structure of Indonesia Stock their saving or excess funds through Exchange12 is different from the most the purchase of securities. This of structure of Stock Exchange in the market is regulated by established world, for example, London Stock rules that promote and maintain fair, Exchange, Stock efficient, secure and transparent Exchange and New York and facilitate the orderly Exchange whereas a process of development of the stock exchange6. continuing an organization from its A fair and efficient performance of a mutual ownership structure to a share stock exchange is a substantial benefit ownership structure which is known to the public. as Demutualization13. The members In Indonesia, the capital of mutually owned exchanges that market7 also play a significant role are, Broker-Dealer dealers with along with banking institution, this is “seats” on the exchange are also its due to the contribution of capital owners, with all the voting rights markets which contribute to conferred by ownership14. In contrast, Indonesian economy as one of the a demutualized exchange is a limited financing in business and investment liability company owned by its area8. The capital which is traded in shareholders. Trading rights and capital market is in the form of ownership can be separated; commercial paper or in the financial shareholders provide capital to the terminology is known as securities9. exchange and receive profits, but they The term of securities can be defined need not conduct trading on the

3Subhashish Saha, Stock Exchange p. 1 Demutualization and Self-Regulation, 8 M Paulus Situmorang, Pengantar Pasar Securities and Exchange Board of India Modal, Mitra Wacana Media, , 2008, Mumbai, Preliminary Draft, September 5, p. 4. 2015, page 2. 9 “Derivatives” refers to rights that are 4According to Rosenberg: Stock Exchange is derived from either debt or equity Securities, “the organization that provides a market for such as Options or Warrants.” the trading of stocks and bonds”. 10 Article 1 poin 5 of Law Number 8 of 1995 5Arwa M. Morsy, The Impact of about Indonesian Capital Market. Demutualization on the Performance of Stock 11 The structure of Indonesia Stock Exchange Exchanges, Maastricht School of is non-profit mutual organization. Management, 2007, p. 7. 12 Arwa M. Morsy, Op.Cit., p. 8. 6 Based on Indonesian Law Number 8 of 1995 13 For more discussion on ownership issue, specifically on article 1 point 13, Capital see, for example, Report of the Technical Market is “the activity of trading and offering Committee of the International Organization securities to the public, the activity of a public of Securities Commissions, “Issues Paper on company with respect to securities issued, Exchange Demutualization.” 2001 and and the activities of securities-related Jennifer Elliot, “Demutualization of institutions and professions”. Exchanges – The Regulatory Perspective.” 7 C.S.T. Kansil, Pokok-Pokok Hukum Pasar 2000, International Monetary Fund Technical Modal, Jakarta, Pustaka Sinar Harapan, 2004, Note.

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exchange. And as discussed later, accurately, on time and transparently although demutualized exchanges regarding information on company’s will continue to provide many if not performance, ownership, and most of the same services, they will stakeholder.19 have different governance structures Corporate Governance is a set in which outside shareholders are of rules which regulate the represented by boards of directors.15 relationship between shareholders, Demutualization, in the strictest managers of the company, creditors, sense, refers to the change in legal government, officers and the internal status of the exchange from a mutual stakeholders or its external which association with one vote per member related to their rights and obligations and possibly consensus-based or in the other word is a system which decision making, into a company regulates and manage the company20. limited by shares, with one vote per In this Journal, I will be share with majority-based decision explained whether the structure of making16. Indonesia Stock Exchange nowadays In the process of implemented the Good Corporate Demutualization, The demand for the Governance to create orderly, fair and implementation of good corporate efficient trading exchange and why is governance is one of the issues to demutualization necessary by attract the interest of coming investor Indonesia Stock Exchange to create on capital market in a state17. Because orderly, fair and efficient trading the more implementation of the exchange. principle of good corporate governance is conducted, it will B. Main Study automatically give good impact for 1. The Implementation of Good the sustainability of capital market in Corporate Governance in general and as an indication of good Indonesia Stock Exchange treatment towards shareholders18. It is agreed that the important of a) The implementation of Good shareholder’s rights to get accurate Corporate Governance information and on time. And also Principles in Indonesia Stock became the responsibility of the Exchange: company to conduct the disclosure 1) Fairness;

14 Reena Aggarwal, Demutualization and 17 Hamud M. Balfas, Hukum Pasar Modal Corporate Governance of Stock Exchanges, Indonesia, Jakarta:PT Tatanusa, 2007, p. 231. Washington D.C. McDonough School of 18 Ridwan Khairandy, Camelia Malik, Business Georgetown University, 2002, p. 6. Op.Cit., page 2. 15 Shamshad Akhtar, Demutualization of 19 See, Tata Kelola Perusahaan, Forum for Asian Stock Exchanges – Critical Issues and Corporate Governance in Indonesia, jilid I Challenges, in DEMUTUALIZATION OF edisi ke-2, 2001, page 3. Whereas according STOCK EXCHANGES: PROBLEMS, to Robert A.G. Monks and Nell Minow, SOLUTIONS AND CASE STUDIES, Asian Corporate Governance, edisi kedua, 2001, Development Bank, 2002, p. 4. page 1, stated that “Corporate Governance is 16 Ridwan Khairandy dan Camelia Malik, the relationship among various participants Good Corporate Governance Perkembangan in determining the direction and performance Pemikiran dan Implementasinya di Indonesia of corporations.” dalam Perspektif Hukum, Yogyakarta, Kreasi Total Media, 2007, page 1.

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Since the parties who the other hand he is a are able being the member of the stock shareholder of Indonesia exchanges, it becomes Stock Exchange are only difficult. This relationship Broker-Dealer. Whereas is indeed very possible based on Article 8 of Law causes the conflict of Number 8 of 1995 has interest between these two specifically defined that the statuses. Because in one one which is able being the side that the board of shareholder of Stock exchanges must protect and Exchange is Securities respect the shareholders, Company which hold which have great power, business license to conduct but on the other side the the activity as Broker- board of exchanges also Dealer. Based on the must have the courage to explanation on article 8, the undertake disciplinary purpose of Stock Exchange action on members which is to provide system and or violate the regulations. facility of securities trading Despite of Indonesia and parties which are able Stock Exchange is a limited to conduct securities liability company but the trading in Stock Exchange element of membership is is only Securities Company existed because there must which are conducting be a separation of status as activity as Broker-Dealer, in between shareholder and so that the shareholder is member. Thus in one side limited only to Securities that the securities company Company which hold as the member of stock business license from OJK exchanges and also in other as the Broker Dealer. side as the shareholder of This type of the exchanges21. relationship may lead to a Consequently, if the non-favourable situation in Securities Company is no the enforcement of longer becoming the membership regulation and member of stock exchange the other capital market because he has no longer regulations, in which at the fulfil the requirement very first place that the role anymore, therefore that and purpose are to protect Securities Company is the public interest. Due to automatically not the nature of the becoming the shareholder relationship between on the of stock exchange and one hand that the securities within three months that company is a shareholder Securities Company shall of stock exchanges, and on sell his share to another

20 See Point II of Regulation III-A about the Membership of Stock Exchanges.

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Securities Company which clarified and evaluated still as the member of deeply, on which part that exchange22. Indonesia Stock Exchange The provision which shall be non-profit motive; regulates on annual budget however the Indonesia plan of stock exchange and Stock Exchange still gain the use of Stock profit from its activities by Exchange’s profit shall be organizing the securities arranged in accordance trading activities. with the provision that Moreover the function as a determined by OJK and marketplace which gives a reported to him in order to responsibility to supervise get approval, Indonesia the market mechanism Stock Exchange is directly, this is difficult for forbidden to distribute Indonesia Stock Exchange dividend toward his to keep its objectivity, shareholders from the independency and uphold profit that have been gained the transparency to public. and those profits shall be The characteristic of used for the interest on the Indonesia Stock Exchange development of company, as SRO has not answered it is set up as the form of the question whether that limitation on that sense of company is actually non- profit oriented23. profit motive or not. Automatically, as the Because those consequence of this characteristics cannot be provision that this will lead strongly being used to to a contradiction between argue that the company is Capital Market Law and non-profit motive. the Indonesian Limited Speaking of the fact that Liability Company Law. from the listing fee and Whereas based on Article transaction fee can be 52 point 1 (a) has been collected profit therefore defined that a share gives that stock exchange as rights for its shareholders SRO’s company cannot be for accepting a dividend. said as non-profit motive, 2) Disclosure; based on the Government Indonesia Stock Regulation Number 45 of Exchange is non-profit 1995 about the Activities in motive, while theoretically, Capital Market has been the purpose of common clearly admitted that the company is for-profit existence of profit within motive. This shall be that company24.

21 Nindyo Pramono, Menyibak Masa Lalu, 22 Ibid, page 12. Menggapai Masa Depan Pasar Modal 23 Ibid, p.12 Indonesia Menuju Milenium III, Capital Market Law Journal No.25 vol.11, page 11.

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Consequently, this answers maximizing the a question that stock implementation of good exchange is basically for corporate governance profit oriented and in principles, because it tends accordance with the to lead the conflict of Indonesian Limited interest inside the company Liability Company Law. moreover the majority of The problems above boards of company come can be analysed based on from the parties which has the practice whereas there direct interest with the shall be a problem inside, it organization of stock might be caused by gap exchange. Therefore its interest between the independency and integrity shareholders as the owner and also the fiduciary of company and the board duties of the boards of of company as the agent. company are really Shareholders have an questionable. When the interest in order that their corporate governance is not fund which had been well implemented yet by invested gives a maximum Indonesia Stock Exchange, return. While the board of this will become a barrier company has interest for him to run the capital toward the incentives market in Indonesia which gained from the fund is orderly, fair and management of efficient. And it is even shareholders25. This also very difficult to conflict of interest compete with others capital naturally will happen in the market in the world. ownership structures 3) Accountability; consist of two types, which Concerning on the are dispersed ownership appointment of directors towards outside investors and commissioners of and ownership structures stock exchange, this kind with the control on some of appointment is also concentrated ownership different with common (Centralized Ownership)26. company. As has been When ownership regulated in Regulation structure of Indonesia Number III.A.3 about the Stock Exchange is requirement of director centralized ownership, this candidates and will lead to monopoly commissioner candidates control and less in the of stock exchange and

24 Antonius Alijoyo dan Subarto Zaini, Kelangsungan Usaha, diterbitkan atas Komisaris Independen, Jakarta, PT Indeks, kerjasama dengan Lembaga Kajian Pasar 2004, page 7. Modal dan Keuangan (LPMK) dan Fakultas 25 Indra Surya dan Ivan Yustivandana, Hukum Universitas Indonesia, Jakarta: Penerapan Good Corporate Governance: Kencana, 2006, page 3. Mengesampingkan Hak-Hak Istimewa Demi

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BAPEPAM chairman different participants in the decree Number: Kep- organization. It provides a 04/PM/1996, 17th of mechanism through which January 1996, had been the objectives of the defined that the name of company are set, and for directors and attaining those objectives commissioners candidate and monitoring can be proposed in one performance. Good package of director or Corporate Governance is commissioner candidates an important step in by a group of shareholders building market confidence which have been fulfilled and encouraging more certain requirement based stable, long-term domestic on the total frequency and and international trading value in the stock investment flows. The exchange. corporation is viewed as an Beside that increasingly important functioning as supervisor driver of wealth creation. upon the directors’ deed, To serve this wealth the board of commissioners creating function, also shall be consisted from corporate must operate the representative of within a framework that several parties which has keeps them focused on direct interest with the their objectives and organization of stock accountable for their exchange, those are issuer, actions. representative of stock 4) Responsibility. exchange’s member, Indonesia Stock representative of investor Exchange at least has two and representative of responsibilities; those are government27. This kind of towards its shareholder and appointment may lead to a towards its stakeholder. On conflict of interest between its implementation, the those parties because they responsibility towards its may have their own interest shareholder is considered at the very first place. well implemented by Therefore mechanism of protecting their interest. appointment shall be But, responsibility towards evaluated such as the its stakeholder including parties may not come from the public interest is not the direct interest with the fully implemented yet organization of stock because the performance of exchange. Indonesia Stock Exchange The corporate on running its function and governance structure duty to organize the specifies the roles of securities trading activities

26 Nindyo Pramono, Op.Cit., page 12.

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in Indonesia is still increased liquidity in questionable due to its exchange for a fee. As a objectivity and result, setting out rules that independency. define the operation of the A fact that shall be market was inherent in the faced by Indonesia Stock notion of an exchange. The Exchange is there are two aim of member regulation interests those are was to ensure that all market investors’ interest and participants would be issuers which listed its reliable trading partners. securities in market. The Thus, Indonesia Stock role of exchange is very Exchange sought first to important on this establish certain eligibility condition, therefore each of criteria to maintain a high- the board of company and quality marketplace. all the parties within the 2) A Public Interest Role for exchange shall uphold their Exchange; responsibility. The While rulemaking for implementation of members, listed companies, fiduciary duties are and trading processes has considered less maximum been a key feature of an due to the composition of organized marketplace, the board of company which central role exchanges play in come from the parties the economy has lent an which have direst interest important public interest towards the organization of perspective to their regulatory stock exchange. function. The exchange is the main gateway through which b) The Essence of Regulatory Role corporate issuers access of Indonesia Stock Exchange public financing, and thus should be like: their interest in maintaining a 1) Organizing a Market and high-quality marketplace Setting Its Rules; coincides with the public goal Indonesia Stock of more efficient allocation of Exchange predate resources. The exchange government agencies as should provide liquid regulators of equity trading secondary markets, which are markets, in fact, regulating a precondition for effective the trading process was the primary markets. In addition, primary goal behind the exchange offers others establishment of an functions that are also organized stock market. beneficial to the wider Exchange constituted an investing public. attempt by a group of 3) Keep Its Independency and brokers to take control of Strict on the Purpose. trading in certain equities so Stock Exchange as as to offer more streamlined SRO shall keep its trading conditions through independency on running its

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function and duties, there shall making of stock exchanges. be no intervention from other In some sense, parties. Therefore, ensuring demutualization can be that directors and other board perceived as a solution of of company act in a conflict of interest by company’s best interest, as segregating the ownership opposed to their own self- from the membership and interest is a must. trading rights thus allowing a proper running of the stock exchanges’ 2. The Necessity of management. Also by Demutualization Conducted by transforming itself into a Indonesia Stock Exchange for-profit investor owned a) Reasons and forces that led to organization, the boards of demutualization of Indonesia company of stock Stock Exchange exchange are able now to 1) Conflict of interests focus on a single group, its between the existing owners. owners and affiliated Conflict of interest can parties; be managed in a number of Driven from article 8 ways, notably by of Law Number 8 of 1995 reorganizing the corporate defined parties which are structure of the exchange allowed being shareholders itself. Many demutualized of Indonesia Stock exchanges have addressed Exchange are members conflicts of interests by which hold business dividing their business license as broker dealer branch from their whereas this causes some regulatory branch. The problems presented above. legislation provides Such quality standard of another means by which good corporate governance conflicts of interest can be is not implemented well yet managed. Therefore, by and still questionable. avoiding this conflict of In the mutual interest, it will exchange such as Indonesia automatically increase the Stock Exchange, the main quality of corporate problem is the imbalance governance in the between members/owners’ securities exchange interest with the investor's activities especially on the interest. Just as stock stock exchange exchanges become more organization such as and more sophisticated, the Indonesia Stock Exchange interests of various nowadays whereas good member groups began to corporate governance diverge. This has led to standard has become a tremendous tensions in the problematic issue. governance and decision-

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2) Increasing role and viewed as a factor that competition from the fastened the process of alternative trading systems; demutualization, because The technological this gives the opportunity improvements from the last for stock exchanges to face decade offered the the reality of the changes in possibility of conducting the capital market trades using remote environment, enhance connections and thus a available synergies and number of alternative even to survive. From the trading platforms have most recent merger news, risen. This fact put a lot of NASDAQ Stock Market pressure on the traditional declared that it is now in stock exchanges in the way the last stage of a definitive that they were pushed to agreement with adopt new and more Philadelphia Stock efficient electronic trading Exchange concerning the systems. One interesting acquisition of the later fact is that in Europe where one28. the process of The present tendencies demutualization started show that the factors that much earlier than in the rest have supported the regions of the world the demutualization of stock weight of the Electronic exchanges are going to be Communication Networks important in the future as (ECNs) is still very small well. The non-profit and not significant. By organization structure is in following the many aspects too limited demutualization path the and is frequently driving to European stock exchanges decision blocking as were able to gain more competing interests operational freedom. The influence the stock new electronic trading exchange. Most of stock systems which were exchanges have accepted adopted by stock this and already exchanges allowed them to transformed themselves reduce the importance of into for profit corporations. regional location in the process of executing trades. b) two types of demutualization that 3) Mergers between financial can be chosen by Indonesia Stock exchanges around the Exchange, those are29: world. 1) Direct Demutualization, in Mergers and this model of demutualization, acquisitions also can be each of SROs which will

27 Saadia Altaf, Demutualization of Stock Master Degree Project in Economic and Exchanges,A Case Research: London Stock Finance, University of Skovde, page 18. Exchange and , 28 Nindyo Pramono,Op.Cit., page 15.

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conduct demutualization each increased their already strong other by conducting public regulatory powers. offering of share towards 2) Flexibility Model other parties; and This model relied heavily on 2) Holding company, in this market participants and granted model of demutualization, the them significant leeway in Stock Exchange organization, regulating many aspects of their and existing SROs will activity. “For-profit” stock establish the holding company exchanges pose greater as the majority shareholder of challenges for these 100% and the SROs will be jurisdictions. In response to the sister company which runs demutualization. Flexibility the regulatory function of Model countries curtailed the securities exchange activities. powers of SROs and enhanced Holding company will oversight by administrative conduct the public offering or agencies. Yet, administrative become the public company, agencies in these jurisdictions while the SROs and or some maintain a regulatory supporting services philosophy of cooperation with organization will be run by market participants, and sister company. typically issue guidance rather Subsequently, a three-step process than mandatory rules. toward demutualization ensued30: 3) Cooperation Model 1) Issuance of private placed In this model, the regulatory stock; power of stock exchanges 2) Conversion into exchange extends over most issues, but is status; and exercised under close 3) Issuance of public stock. supervision by government There are three distinct models for the agencies. Instead of division of regulatory responsibility substantially limiting self- for securities markets, namely31: regulation, governments in the 1) Government-led Model Cooperation Model developed This model provides central mechanism to insulate stock governments with direct exchange regulatory activity channels of influence over from the operation of the securities markets regulation. markets. Thus, under These jurisdictions reacted to government influence, stock stock exchange exchanges segregated their demutualization by enhancing regulatory functions in a the efficiency of government separate, independently-run supervision: they reshuffled the subsidiary. organization of their administrative agencies and

29 Jaclyn Freeman, Limiting SRO Immunity to 30 Stavros Gadinis and Howell E. Jackson, Mitigate Risky Behaviour, Journal on Markets as Regulators: A Survey, Southern Telecommunication & High Technology California Law Review, 2007, page 4. Law, 2014, page 9.

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Demutualization is advanced to provide a sense of security capital market appear to have been and an adequate level of driven by business considerations protection for the investor. A rather than by regulatory concerns, fair and efficient performance although in cases such as the of a stock exchange is a NASD/Nasdaq, increased security by substantial benefit to the regulators has resulted in a re- public. The spirit of capital engineering of governance structure market itself is on the that is compatible with the changes disclosure principle. By the necessary to a demutualization. disclosure, people will not However, in emerging market only know several activities countries such as in Asia, regulatory conducted by certain parties, concerns may be the impetus for because there has been demutualization which seem, more information which provided, often than not, to be driven by the but by disclosure, it is authorities in an attempt to wrest expected the existence of a control of an institution that serves a public control towards certain public role and as regulator from a activities. The demand for the self-interested group of brokers, the implementation of good traditional model fails to deliver an corporate governance is one appropriate level of regulation or fails of the issues to attract the to sufficiently develop the capital interest of potential investor markets because the exchange is on capital market in a state. controlled by the interests of the Because the more members which may not be the same implementation of the interests as those of capital market as principle of good corporate a whole. Thus, from the explanation governance done, it will above that the need of automatically give the good demutualization conducted by impact for the life of capital Indonesia Stock Exchange is very market generally and as the urgent due to the current situation indication of the good happened in Indonesia Capital Market treatment towards structure and also in the near future. shareholders. When Good corporate governance is not yet being well implemented C. Conclusion and by Indonesia Stock Exchange, Recommendation it will be a significant barrier to run the capital market in 1. Conclusion. Indonesia accordingly to the By some previous principle of orderly, fair and explanations, therefore it can be efficient. concluded as follow: 2. Demutualization can be 1. The purpose of establishment considered as a solution to of Indonesia Stock Exchange increase the quality of is to run the securities trading corporate governance. Also which orderly, fair and by transforming itself into a efficient. Therefore the basic for-profit investor owned purpose of stock exchange is organization, the managers of

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the stock exchange are able of establishing the holding now to focus on a single company. group, its owners. Therefore c. Indonesia Stock Exchange the demutualized exchange and other SROs shall obey will have different governance the existing regulations structures in which outside either from the shareholders are represented Government or set of by boards of directors. regulations which are Demutualization will only created by their self as shifting its function to be more SROs focus on its duty as rulemaking and regulatory D. Referrence body during the securities exchange activities. Books Demutualization is at least Antonius Alijoyo dan Subarto perceived to create separating Zaini, Komisaris lines between the profit Independen, Jakarta: motive of an exchange and its PT Indeks, 2004. regulatory function, there have been numbers of major C.S.T. Kansil, Pokok-Pokok changes such as separating the Hukum Pasar Modal, function of SRO to focus on Jakarta: Pustaka Sinar the regulatory function and Harapan, 2004. then making the holding company for profit only Hamud M. Balfas, Hukum thereby avoiding and reducing Pasar Modal Indonesia, some of the conflicts of Jakarta:PT Tatanusa, interest issues. 2007.

2. Recommendation Indra Surya dan Ivan a. There should be an Yustivandana, amendment of article 8 of Penerapan Good Law Number 8 of 1995, Corporate Governance: whereas the structure of Mengesampingkan ownership should be Hak-Hak Istimewa changed in order to Demi Kelangsungan increase the quality of Usaha, diterbitkan atas corporate governance and kerjasama dengan strengthening the Lembaga Kajian Pasar regulatory framework. Modal dan Keuangan Thus it will automatically (LPMK) dan Fakultas give a positive impact to Hukum Universitas create orderly, fair, and Indonesia, Jakarta: efficient trading in Kencana, 2006. Indonesia Capital Market. b. The demutualization M Paulus Situmorang, conducted by Indonesia Pengantar Pasar Modal, Stock Exchange in the form

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Mitra Wacana Media, Saadia Altaf, Demutualization of Jakarta, 2008. Stock Exchanges, A Case Ridwan Khairandy, Camelia Research: London Stock Malik, Good Exchange nd Hong Kong Corporate Governance Stock Exchange, Master Perkembangan Degree Project in Economic Pemikiran dan and Finance, University of Implementasinya di Skovde, 2009. Indonesia dalam Perspektif Hukum, Shamshad Akhtar, Demutualization Yogyakarta: Kreasi of Asian Stock Exchanges Total Media, 2007. – Critical Issues and Challenges, in Journals DEMUTUALIZATION Arwa M. Morsy, the Impact of OF STOCK Demutualization on the EXCHANGES: Performance of Stock PROBLEMS, Exchanges, Maastricht SOLUTIONS AND School of Management, CASE STUDIES. Asian 2007. Development Bank, 2002.

Jaclyn Freeman, Limiting SRO Stavros Gadinis and Howell E. Immunity to Mitigate Risky Jackson, Markets as Behaviour, Journal on Regulators: A Survey, Telecommunication & High Southern California Law Technology Law, 2014. Review, 2007.

Nindyo Pramono, Menyibak Masa Subhashish Saha, Stock Exchange Lalu, Menggapai Masa Demutualization and Depan Pasar Modal Self-Regulation, Indonesia Menuju Securities and Exchange Milenium III, Capital Board of India Mumbai, Market Law Journal, Preliminary Draft, number 25 vol. 11, 2004. September 5, 2015.

Reena Aggarwal, Demutualization and Corporate Governance National Legislation of Stock Exchanges, Law Number 8 of 1995 about Washington D.C. Indonesia Capital Market Law. McDonough School of Amendment of Regulation Number Business Georgetown III-A about Exchange Membership by University, 2002. Indonesia Stock Exchange

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