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what information are minority share holders entitled to

This is an ultimate guide on the shareholders' rights and duties in Indonesia.

Being a shareholder of a company, you are entitled to crucial rights and duties within the company that makes the company function correctly, and by breaching the duties, shareholders are often faced with legal penalties.

Let's dive right into more than about shareholders in Republic of indonesia.

What is a shareholder?

A shareholder is an private or visitor that owns shares of the company. Once they own shares, they will become owners of the company. Every visitor must have at to the lowest degree two shareholders for the company to be able to exist incorporated.

Shareholders' rights

Company shareholders are entitled to the following rights:

  • Nourish the full general meeting of shareholders (GMS) and cast votes in accord with the number of shares held
  • Receive dividend payments and asset distribution after liquidation
  • File a lawsuit against the company if the shareholder suffers any losses equally a result of the actions of the company that are considered unfair and unreasonable as a effect of a resolution of the GMS, the board of directors or board of commissioners
  • Asking the visitor to repurchase the shareholder'due south shares at a reasonable price in the result of certain specified corporate transactions
  • Pre-emptive rights to subscribe to newly issued shares in proportion to the shareholder'south shareholding for the equivalent class of shares.

Shareholders' duties

Duties that shareholders are entitled to include:

  • Appoint and dismiss company directors
  • Bank check financial reports
  • Blueprint and determine a business plan

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  • Detect foreign registration options & restrictions

  • Learn about available regime incentives & promotions

  • Understand all compliance requirements

Incorporation Playbook

Register of shareholders

Register of shareholders must comprise:

  • Shareholder'southward names
  • Shareholder'south addresses
  • The number, serial number and date of acquisition of shares held by the shareholders and their classification when more than 1 classification of shares has been issued
  • The amount paid-upward on every share
  • The proper noun and accost of an individual or legal entity who has a pledge over the shares or is the recipient of fiduciary security over shares and the engagement of acquisition of the pledge of registration of the fiduciary security

Information disclosure to shareholders

Nether the Company Police, the lath of directors must allow the shareholders to:

  • Examine the register of shareholders, the special register of shareholders, minutes of the general coming together of shareholders and annual reports
  • Obtain copies of the minutes of the GMS and almanac reports of the company

Shareholders' understanding

Provisions included in the shareholders' agreements include just are not limited to:

  • Capitalisation
  • Corporate governance
  • Distribution of dividends
  • Governing law and the settlement of disputes
  • Pre-emptive rights
  • Protective covenants
  • Rights and obligations of shareholders
  • Reserved matters that must be unanimously approved by the lath of directors or the board of commissioners or shareholders
  • Representations and warranties
  • Restriction on the encumbrance of shares
  • The engagement of the board of commissioners and board of directors
  • The requirements and procedures for the transfer of shares
  • Termination
  • Voting rights

Annual shareholder'southward coming together

The annual general coming together of shareholders must exist held no longer than six months subsequently the finish of each fiscal twelvemonth to discuss and adopt resolutions including:

  • Blessing of the company's annual report
  • Appropriation of profits
  • Appointment of auditors
  • Ratification of the company's audited financial statements

The annual written report should contain:

  • A fiscal report consisting of at least the last balance sheet for the electric current fiscal yr compared to the previous financial year, a turn a profit and loss statement for the fiscal yr, a cash menstruum report and a report on changes in disinterestedness and notes on the financial study
  • A study on the visitor'southward activities
  • A report on the implementation of environmental and social responsibility
  • Details of any problems that arose during the financial year that affected the business organization activities
  • A study on the supervisory duties performed past the board of commissioners during the financial twelvemonth that just ended
  • Names of the members of the lath of directors and members of the board of commissioners
  • Salaries and allowances for members of the board of directors and board of commissioners

Minority shareholders

Minority shareholders are shareholders who concur less than 50% of the visitor shares and does not have bulk control over the land. There are several legal protections given to minority shareholders to balance their position with majority shareholders.

The legal protection includes:

  • Filing lawsuits against the visitor, members of the board of directors and lath of commissioners
  • Purchasing shares at a reasonable cost – Shareholders have the right to asking the company to purchase the shares at a reasonable price of the shareholder does non corroborate of the company'due south activeness.
  • Requesting a GMS – Annual GMS can be held with the asking of ane or more shareholders who represent 1/x of the total number of shares with voting rights.
  • Examining the company – Company examination can be carried out when there is suspicion that the visitor has committed an illegal act that harms the shareholders or third parties, or when the member of the board of directors or board of commissioners commit an act that damages the visitor, shareholders or third parties.
  • Propose dissolution of the company – One or more than shareholders representing 1/10 of the number of shares with voting rights may propose the dissolution of the company.

Resident shareholders

A resident shareholder is a person or company that acts as the registered owner of a visitor's shares on behalf of the real owners. When resident shareholders are appointed, your personal details are protected and will not be displayed publicly. Your shares will be held under a Trust which is backed by the Annunciation of Trust signed by the resident shareholder.

There are two principal reasons why foreign companies cull to employ resident shareholders:

  1. Doing business in an manufacture that is airtight or restricted to foreign companies co-ordinate to the Indonesia Negative Investment List
  2. Starting a company with less than the minimum paid-up capital letter (IDR 2.5 billion) required for foreign companies

Determination

Shareholders must act according to the duties equally listed above and should know what rights they have in the company. To ensure y'all empathize the function of a shareholder, feel free to seek advice fromAcclime.

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Source: https://indonesia.acclime.com/guides/shareholder-rights-duties/