In practice, not every shareholder serves as the board in a company; and in certain cases, the shareholder faces difficulty to get access in the company. Based on the Article 52 paragraph (1) of Law Number 40 Year 2007 on Limited Liability Companies as amended by Law Number 6 Year 2022 on the Stipulation of Government Regulation in Lieu of Law Number 2 Year 2022 on Job Creation into Law (the “Company Law“), apart from the right to attend the General Meeting of Shareholders (the “RUPS“), the right to dividends, and rights for the remaining assets from liquidation, shareholders can also exercise the other rights as stipulated in the Company Law. One of these other rights is as reflected in the Article 138 of the Company Law, wherein the shareholders representing at least 1/10 (one-tenth) of the total number of shares with voting rights can submit a request for the examination of the Company to the court if there are allegations of unlawful acts committed by the Company, the Board of Directors, or the Board of Commissioners that harm the shareholders or other third parties.
However, it should be noted that the application for company examination submitted to the District Court can only be made after the applicant has previously requested data or information from the Company in the RUPS, but the data or information is not provided by the Company. Therefore, the application for company examination in the Article 138 to Article 141 of the Company Law can serve as an additional measure to address bad faith actions of the Company, the Board of Directors, or the Board of Commissioners that harm shareholders.
The implementation of the Article 138 of the Company Law can be seen in our case – Denpasar District Court Decision Number 228/Pdt.P/2024/PN Dps. In this case, we as the applicant requested an examination of the Company with the aim of obtaining data or information due to allegations of unlawful act by the Director of the Company. In addition, the Director of the Company had not acted in good faith by failing to submit the annual report and annual work plan as required under the Article 66(1) and (2), Article 63, and Article 97(2) of the Company Law.
As a follow-up to the unlawful act, the panel then granted the Petitioner’s petition by appointing an expert in the finance field as an auditor and ordered the Company to provide all documents and information to the appointed auditor. Within 90 (ninety) days from the date of appointment, the appointed auditor shall submit a copy of the Audit Report to the Chairman of the Denpasar District Court. The Applicant can determine the attitude and further action against the company based on the examination report.
The availability of provisions related to submitting a request for an audit of the company is a form of protection for shareholders. The Company Law provides facilities for repressive efforts following up a company or members of the board of directors or members of the board of commissioners who commit illegal acts that can harm the shareholders. Therefore, although the shareholders are only responsible for the company based on the number of shares they own, they still have the rights to know all the information and conduct an examination or audit of the company if there are allegations of unlawful acts that can harm the shareholders.
Written by: R. Bayu Perdana, Shabrina Hanifa, and Soraya Firmansjah
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