Debt Trust Deed Template for Indonesia

When you're issuing debt securities in Indonesia, a Debt Trust Deed serves as the cornerstone document that establishes the legal framework between your company, the appointed trustee, and bondholders. This essential agreement ensures compliance with Indonesian capital markets regulations while protecting the interests of all parties involved in the debt arrangement.

When do you need this document?

You'll require a Debt Trust Deed whenever your company plans to issue bonds, sukuk, or other debt securities in Indonesia's capital markets. This applies to both public offerings listed on the Indonesia Stock Exchange and private placements to institutional investors. The document becomes mandatory when appointing a trustee (Wali Amanat) as required under OJK regulations for most debt security issuances. You'll also need this agreement when establishing security arrangements over company assets to secure the debt, or when creating complex debt structures involving multiple tranches or convertible features.

Key legal considerations

Your Debt Trust Deed must carefully address several critical legal elements to ensure enforceability and regulatory compliance. The trustee appointment clause should clearly define the scope of authority, including powers to enforce security, represent bondholders in legal proceedings, and monitor compliance with debt covenants. Security provisions require precise documentation of any collateral arrangements, including land mortgages under Law No. 4 of 1996 or fiduciary security under Law No. 42 of 1999. Events of default must be comprehensively defined, covering payment defaults, covenant breaches, and material adverse changes. The document should also establish clear procedures for bondholder meetings, voting mechanisms, and amendment processes. Cross-default provisions linking to other company debts require careful drafting to avoid unintended acceleration scenarios.

Legal requirements in Indonesia

Indonesian law imposes specific regulatory requirements that your Debt Trust Deed must satisfy to be legally valid and enforceable. Under OJK Regulation No. 19/POJK.04/2020, the appointed trustee must be a licensed trust agent (Wali Amanat) approved by the Financial Services Authority. The document must comply with Law No. 8 of 1995 on Capital Markets, including provisions for ongoing disclosure obligations and investor protection measures. Security arrangements must follow Indonesian Civil Code principles and specific security laws, with proper registration requirements for different asset types. The deed must include mandatory disclosure provisions enabling bondholders to access relevant financial information and company updates. Additionally, the document should address Indonesian tax considerations, including withholding tax obligations and any applicable tax treaties for foreign investors.