To help protect financial institutions from collapse during the COVID-19 pandemic, President Joko “Jokowi” Widodo recently signed Government Regulation in Lieu of Law (Perppu) No. 1/2020 that will, among other measures, authorize the Financial Services Authority (OJK) to force small and struggling banks to consolidate. While this authority was actually given to the financial agency in the OJK Regulation (POJK) No. 41/POJK.03/2019, the Perppu allows for stricter enforcement against violations of merger instructions from the OJK, including imprisonment. Under the POJK, penalties are limited to administrative sanctions. “Perppu No. 1/2020 will form the legal foundation to grant the government, the OJK, Bank Indonesia and the Deposit Insurance Corporation (LPS) authorities that have not been established under current laws. Therefore, we could take preemptive measures ...