Financial Services Authority or commonly abbreviated as OJK, is an independent institution and free from the intervention of other party, which has the functions, duties, and authority to regulate, supervise, examine, and investigate against the activities in the financial services sector, which are the activities in banking, capital markets, insurance, pension funds, funding institutions and other financial service institutions.
In performing its duties, OJK can coordinate with related financial service institutions and OJK is authorized to make regulations in the field of related financial services, for example OJK can coordinate with Bank of Indonesia to make regulation of supervision of banking.
OJK is domiciled in the capital city of the State, but OJK may also have office inside and outside the territory of the Republic of Indonesia which was made according to its needs.
The purpose of the establishment of OJK is to ensure that the overall activities within the financial services sector are implemented in an organized, fair, transparent and accountable manner. Besides that, OJK is expected to implement the financial systems that grow in a sustainable and stable and to protect the interests of consumers and community.
In performing its daily duties, OJK is led by the Board of Commissioners which is collective and collegial. Board of Commissioners consists of nine (9) members who consists of the elements of the government, Bank of Indonesia, and the community. The candidate of the members of the Board of Commissioners is elected by the House of Representatives from the candidates who are nominated by the President, which later is determined by a Presidential Decree. Members of the Board of Commissioners is appointed for a term of 5 (five) years and may be reappointed for one (1) term.
Members of the Board of Commissioners or a person who has to be a member of the Board of Commissioners, official or employee of OJK is prohibited to use or disclose any confidential information to other parties, unless in the context of performing its functions, duties, and authority based on the OJK’s decisions or is obliged by the law. If it is violated, it shall be punishable by a maximum imprisonment of 6 (six) years and a maximum fine of Rp 15,000,000,000.00 (fifteen billion Rupiah).
Board of Commissioners conducts a general meeting of the Board of Commissioners at least 1 (one) time in 2 (two) weeks or any time by the request from one member of the Board of Commissioners. Meeting of the Board of Commissioners shall be lawful if attended by more than ½ (one half) of the members of the Board of Commissioners. Decision making in the meeting is based on the deliberation to reach consensus. If the deliberation is not reached, the decision is determined by majority vote. In every meeting, the minutes of meeting has to be made which is signed by all members of the Board of Commissioners who attend the meeting.
To support the performance of the functions, duties and authority of the OJK, the Board of Commissioners may form supporting organs which include secretarial, the Board of Auditors, the Ethics Committee, and other organ which is needed.
Board of Commissioner arranges and implements the work plan and budget of OJK. OJK’s budget is funded from the State Budget and / or fees from parties who conduct their businesses in the financial services sector. The determination of the amount of the budget of OJK should obtain prior approval from the House of Representatives.
OJK is obliged to prepare financial report which consists of quarterly and annual financial report. Annual financial report is audited by Audit Board or Public Accountant which is appointed by the Audit Board. Besides preparing the financial report, OJK is also obliged to prepare an activities report which consist of monthly, quarterly, and annual activities report. The annual activities report is submitted to the President and the House of Representatives.