In order to to improve management of the stock exchanges, Bapepam revised the procedures for selecting, recruiting, and nominating commissioners and directors of the exchanges by revising Rule III.A.3. These changes were reflected in amendment to the Article of Association of the JSX and SSX.

The election of JSX management in April 1999 was followed by reorganization of the exchange to provide more detailed job descriptions for director position in line with the revised rule.

The proposal for merger of the JSX and SSX made by the team for JSX and SSX Merger Review, composed of members of the stock exchanges, was not approved by the members meeting of the SSX on May 6, 1999. As a consequence, the SSX decided to concentrate its activities on trading mining stocks, derivatives and bonds, while the JSX decided to focus on its traditional activities.

The election of SSX directors on October 28, 1999 was followed by reorganization of its management. Bapepam approved the request of the SSX to operate with only 3 directors instead of 5 directors, due to financial constraints.

Bapepam approved JSX rules on listing and auction of exchange seat as well as trading rules of the JSX and SSX on pre-emptive rights with settlement by book entry. Bapepam also approved JSX revised rule for standard trading lot of bank share, increasing lot size from 500 shares to 5000 shares. The change was a result of decreased prices in the banking sector.

Bapepam examined JSX and SSX draft rules regarding merger and liquidation of listed companies. Bapepam also examined SSX proposed rules regarding listing of mining companies, and future contracts. During the year, the SSX was considering possible listing requirements for cooperatives.

Besides, Bapepam also was in process of preparing rules regarding securities transfer, including provision for adverse claims in the event lost, stolen, or destroyed securities and responsiblities of the various parties involved.

With respect to market supervision, Bapepam advised the stock exchanges to take adequate measures on trading of lost or stolen stocks. Bapepam also actively monitored transfer agents and issuers with respect to non listed securities.

With respect to trading activity, Bapepam instructed JSX and SSX to establish rules on market surveillance, supervision of listed companies, and inspections of stock exchange members for regulatory compliance.

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