BI Strengthens Provisions on the Reporting of Foreign Exchange and Customer Traffic

With the ultimate goal in mind of easing the policy-making process as it relates to Indonesia’s monetary, macro-economic and payment systems, Bank Indonesia (“BI”) has issued Regulation No. 18/10/PBI/2016 on the Oversight of Foreign Exchange and Customer Traffic (“2016 Regulation”). [1] The 2016 Regulation redefines the various procedures and requirements which have to be met by commercial banks operating within Indonesia, as regards the reporting of their foreign-exchange traffic (Lalu Lintas Devisa/”LLD”). These reports will become the basis upon which BI will eventually formulate various policies. Prior to the issuance of the 2016 Regulation, this matter was previously regulated under BI Regulation No. 13/21/PBI/2011 (“2011 Regulation”).The 2016 Regulation is of relevance to all commercial banks, customers of commercial banks and exporters.LLD ReportsLLD is defined as any activity that results in the transfer of assets and financial obligations between Indonesian citizens and non-Indonesian citizens, as well as the transfer of foreign assets and financial obligations between Indonesian citizens. [2] All commercial banks (“Banks”) must submit complete reports of their LLD activities to BI, and these reports should incorporate the following information: [3]