Jakarta regulators have ordered listed firms to double their free‑float to at least 15 per cent and to disclose any shareholder holding above 1 per cent. The move follows MSCI’s January warning that Indonesia could slip to frontier status because too many companies have thin, opaque share structures. A market sell‑off ensued, prompting the new rules.

Analysts say compliance will be costly; only 566 of 956 stocks cleared the 15 % threshold in March, leaving roughly $11.4bn of market capitalisation to be newly floated. Lotte Chemical Titan, with a current 7.5 % free‑float, is reviewing delisting, while Solusi Tunas Pratama, below 1 %, already moved toward a private takeover. Firms may resort to nominee structures to meet the quota, a practice the regulator deems illegal.

The increased supply of tradable shares strains a market already dominated by short‑term retail traders and volatile price swings. Authorities have raised the equity caps for insurers and pension funds to 20 % of assets, hoping to soak up the extra float, but critics warn this could heighten portfolio risk. Without strict enforcement, the reforms may simply thin the pool of listed equities.