Observer: Free Float 15 Percent Policy and Demutualization of the Indonesia Stock Exchange is an Effort to Meet International Standards

JAKARTA - Money market observer Ibrahim Assuaibi revealed that the policy of increasing the minimum free float of shares by 15 percent and demutualization of the Indonesia Stock Exchange (IDX) is an effort to meet international standards as part of the reform of the Indonesian capital market.

"The free float of 7.5 percent is apparently still below international standards so the government raised it to follow what Morgan Stanley Capital International (MSCI) wants," said Ibrahim, quoted by Antara, Tuesday, February 3.

Likewise, the demutualization policy of the IDX is one of the inputs from MSCI in the framework of improving the Indonesian capital market.

"MSCI is asking for reforms, all reforms, if possible, even companies that have listed on the exchange must be rearranged again," said Ibrahim.

For information, OJK targets the implementation of regulations regarding the increase in the free float limit of shares from 7.5 percent to 15 percent to be carried out in March 2026.

Regarding the results of the meeting with Morgan Stanley Capital International (MSCI), Member of the Board of Commissioners for the Chairman and Vice Chairman of the OJK Commission, Friderica Widyasari Dewi alias Kiky, ensured that the OJK and the Self-Regulatory Organization (SRO) had submitted proposals as required to MSCI.

He revealed that what MSCI expects is the seriousness of the Indonesian capital market authorities in implementing the action plan related to the proposal that has been submitted.

In a meeting with MSCI, OJK and SRO conveyed their commitment to increasing transparency in the Indonesian capital market, including through disclosure of share ownership above 1 percent.

In addition, the implementation of a more granular investor classification from the previous seven investor sub-types to 27 investor sub-types, as well as conveying information related to the plan to increase the free float of shares from the minimum of 7.5 percent to a minimum of 15 percent.