New Regulations on Foreign Exchange Market Transactions
Dear Valued Customer,
We wish to inform you the latest regulations issued by Bank Indonesia on foreign currency transactions which is effective on 30 September 2024, as follows (“Regulations”):
1. Bank Indonesia Regulation (PBI) No. 6 of 2024 concerning Money Market and Foreign Exchange; and
2. Regulation of the Member of the Board of Governors (PADG) No. 11 of 2024 concerning Foreign Exchange Transactions,
The following are important changes related to foreign exchange transactions from the Regulation above:
A. Transaction Underlying Documents
1. For derivative transactions of foreign exchange rates against the rupiah, if (a) a transaction extension (roll over), (b) early termination (early termination); or (c) transaction termination (unwind); must now meet the following requirements:
a. Regulated in the agreement and/or agreed by both parties;
b. Supported by supporting documents that support the transaction adjustment;
2. Underlying transaction documents and/or supporting documents must be submitted no later than: (a) the transaction settlement date; (b) the date of accelerated transaction settlement (early termination); or the transaction termination date (unwind).
3. For the use of supporting documents in the form of invoices or commercial invoices with the requirement of no later than 3 (three) months from the due date, it must be accompanied by:
a. MT103 containing information regarding payment of the invoice in question; and
b. a statement from the transaction actor that foreign currency payments have never been made based on the invoice in question. If the invoice does not have a due date, the date of issuance can be considered the due date.
If MT103 is not available, then a document containing the same information as MT103 can be used, such as proof of funds transfer, including: account transfers, fund transfer orders, and money transfer request forms signed by the customer or electronic instructions that can be validated by the bank for debiting funds.
B. Transaction Threshold
1. For foreign exchange derivative transactions SWAP, a certain amount (threshold) which was previously divided into a purchase transaction of USD100,000 (one hundred thousand US dollars) or its equivalent per month per transaction actor and a sale transaction of USD1,000,000.00 (one million US dollars) or its equivalent per transaction has changed to both a sale and purchase transaction of USD5,000,000.00 (five million US dollars) or its equivalent per transaction.
C. Rounding of Underlying Nominal Value
1. The nominal value for foreign currency transactions against the rupiah and DNDF which was previously rounded up in multiples of USD10,000.00 (ten thousand US dollars) has changed to being rounded up in multiples of 10,000.00 (ten thousand) nearest according to the currency listed in the supporting transaction documents.
D. Transition
1. Foreign Exchange Market transactions carried out before this Regulation of the Member of the Board of Governors comes into effect shall still refer to the provisions of the Regulation of the Member of the Board of Governors Number 24/10/PADG/2024 dated July 4, 2022 concerning the Implementation Regulations for Transactions in the Foreign Exchange Market until the period of the Foreign Exchange Market transactions ends.
2. Domestic non-deliverable forward transactions carried out before this Regulation of the Member of the Board of Governors comes into effect shall still refer to the provisions of the Regulation of the Member of the Board of Governors Number 24/11/PADG/2022 dated July 4, 2022 concerning Domestic Non-Deliverable Forward Transactions until the period of the domestic non-deliverable forward transactions ends.
This notification is issued in bilingual form of Bahasa Indonesia and English text. In the event of inconsistency between both text, the Bahasa Indonesia text will prevail.
We encourage you to seek independent advice from your advisor, however you may still contact your Relationship Manager if you require further information in relation to the above notification.
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Issued by PT Bank HSBC Indonesia which is licensed and supervised by Financial Services Authority (OJK).
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