Indonesia extends buyback waiver to June 2027

Indonesia’s Financial Services Authority (OJK) has extended a policy that allows listed companies to buy back their shares without prior approval from a general meeting of shareholders until June 2027. The policy had previously been scheduled to remain in effect only until late 2026. The decision was announced on Monday at a press conference held at the Indonesia Stock Exchange in Jakarta.

OJK officials said the extension responds to requests from issuers seeking greater certainty over the timeframe for conducting buybacks. Many listed companies are assessed to view current share price levels as favourable for carrying out repurchases under this framework.

The extension comes after Indonesia’s stock market experienced turbulence following an MSCI proposal regarding the country’s market status. In the wake of that proposal, several listed companies undertook share buybacks, making use of the existing policy that eased approval requirements.

Hasan Fawzi, OJK’s Chief Executive for Capital Market Supervision, said the policy was initially designed to apply until the end of 2026. However, strong interest from listed companies in continuing buybacks under these conditions led to the decision to prolong the measure to June 2027 to provide clarity over the available window.

Despite the relaxed requirement on shareholder approvals, OJK has emphasised that all buyback activity must strictly comply with existing regulations. These include OJK Regulation No. 13 of 2023 and OJK Regulation No. 29 of 2023, which require listed companies to follow prudential principles, assess their internal financial capacity and meet all obligations when conducting repurchases.

Issuers are required to ensure that buybacks do not compromise compliance with the minimum public shareholding, or free float, requirement. Companies must also retransfer shares acquired through buybacks in accordance with applicable regulations, and fulfil information disclosure obligations intended to support market stability and investor confidence.

The extended deadline for the buyback policy aligns with the expected timing of MSCI’s next decision on Indonesia’s stock market classification. Indonesia has been proposed for reclassification as a Standalone Market, and the decision is anticipated between 20 and 30 June 2027.

Authorities noted that the buyback extension complements earlier steps taken by stock market regulators to manage volatility. By keeping the no-approval buyback framework in place through the period when the MSCI outcome is expected, OJK aims to maintain flexibility for listed companies while requiring strict adherence to prudential and disclosure standards.