Updates on New Responsibilities of Seller under New Auction Regulation

Minister of Finance of The Republic of Indonesia Regulation Number 27/PML.06/2016 of 2016 concerning Guidelines on Auction Implementation (“PMK 27/2016”) and Minister of Finance of The Republic of Indonesia Regulation Number 90/PMK.06/2016 concerning Guidelines on the Implementation of Auction Through the Internet (“PMK 90/2016”) (PMK 27/2016 and PMK 90/2016 hereinafter jointly referred to as “Old Regulations”) has been revoked by the issuance Minister of Finance of The Republic of Indonesia Regulation Number 213/PMK.06/2020 concerning Guidelines on Auction Implementation (“PMK 213/2020”).

Unlike the Old Regulations, which distinct implementation of auctions arrangement that attended physically and through the Internet, PMK 213/2020 unifies the former and latter mechanisms into one regulation. It makes PMK 213/2020 easier and practical to be understood by the stakeholders.

In the Indonesian banking practice, If the debtor cannot fulfill its obligation under the loan agreement, the bank (as a creditor) may sell the collateral (jaminan) through a public auction as a seller (“Seller”). Therefore, understanding new responsibilities under PMK 213/2020 is necessary for the bank to avoid any auction dispute.

Seller`s responsibility under PMK 213/2020 turns into more detail and well-structured than the Old Regulations. The following is the comparison of Seller`s responsibility amongst PMK 213/2020 and PMK 27/2020:

In general, after the Ministry of Finance enacted the regulation regarding the auction, the directorate general of state wealth (“DJKN”) also enacting DJKN`s regulation concerning technical guidelines on the auction implementation. However, until the issuance date of this article, DJKN has not issued new regulation yet. Based on that, the Regulation of DJKN No. 6/KN/2013 of 2013 jo. Regulation of DJKN No. 2/KN/2017 of 2017 concerning Technical Guidelines on the Auction Implementation is still in force.

PMK 213/2020 is in force after 3 (three) months since 12 December 2020.

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