Jakarta. The Financial Services Authority (OJK) will gradually enforce a minimum public ownership, or free float, of 15% for all listed companies, giving issuers up to two years to comply and introducing special trading notations for firms that fall short.

The policy aims to improve market liquidity and strengthen investor protection, particularly for retail investors. Companies that fail to meet the requirement by the end of the transition period could ultimately face delisting from the stock exchange.

The free-float increase is part of a broader reform push to strengthen the transparency and integrity of Indonesia’s capital market, following concerns raised by global index provider MSCI. On Jan. 27, MSCI flagged issues related to market transparency and liquidity in Indonesian stocks, warning that the country could face a downgrade to “frontier market” status — a move that subsequently triggered capital outflows.

Regulators say the tighter free-float rules are intended to address those concerns and build a more credible, adaptive market ecosystem capable of meeting the expectations of both domestic and global investors.

Friderica Widyasari Dewi, the acting chair and vice chair of OJK’s board of commissioners, said the free-float increase would be implemented in stages over two years, with clear transition mechanisms and an exit policy for non-compliant issuers.

“The 15% free-float requirement will be fulfilled gradually over two years,” Friderica said at a press conference at the Indonesia Stock Exchange on Friday. “We will outline how the transition period works, including the exit policy for issuers that cannot meet the minimum.”

As part of the new framework, OJK plans to introduce a special notation to flag stocks with public ownership below 15%. The marker will appear on trading systems, allowing investors to more easily identify shares with limited public float.

“This will be something new,” Friderica said. “There will be a special notation for issuers that have not met the 15% free-float requirement, so investors can make more informed choices.”

Low free-float stocks are typically associated with thinner trading volumes and higher price volatility, factors that can amplify risks for investors. By clearly flagging such shares, the regulator aims to add another layer of transparency to the market.

“Investors will be able to immediately see a flag indicating that a stock’s free float is below 15%,” Friderica said. “They can then assess which shares are more liquid and which require greater caution.”

OJK has already held discussions with listed companies and issuer associations to secure commitments to comply with the new rule. While the regulator has internal targets for how many companies are expected to meet the threshold within the first year, those figures have not yet been disclosed.

“We have asked for their commitment and are giving them one to two years,” Friderica said. “We already have internal targets for how many can reach 15% within a year, but I can’t share those numbers yet.”

IDX estimates the market will need to absorb an additional Rp 187 trillion ($11 billion) worth of shares for listed companies to comply with the higher free-float threshold. Data from the Monthly Securities Ownership Registration Report (LBRE) as of Dec. 31, 2025, show that 267 listed firms have met the current minimum public ownership requirement of 7.5% but still fall short of the new 15% target.

Questions remain over whether the government will offer incentives — such as tax breaks or regulatory relief — to encourage companies to increase their public ownership. Friderica said such measures are still under discussion and have not been finalized.

She stressed that the policy would not be enforced abruptly, giving issuers ample time to adjust their ownership structures. However, companies that remain unable or unwilling to comply will face clear consequences.

“For those that cannot meet the requirement, the exit policy is clear,” she said. “They may delist from the exchange.”

The move marks one of the most significant recent efforts by Indonesian regulators to deepen capital markets and reduce risks associated with tightly held stocks, as authorities seek to attract more long-term and foreign investment into Southeast Asia’s largest economy.

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