Multimedia company PT First Media said on Tuesday that its legal dispute with media giant Astro Malaysia over a failed pay-television joint venture must be settled under Indonesian jurisdiction.
“The Indonesian courts are the only courts that have jurisdiction to settle the matter, not Singapore. We can’t let them destroy our legal system,” said Peter Gontha, First Media’s president commissioner.
Gontha was responding to the decision by the Singapore International Arbitration Centre (SIAC) last week that the company and two affiliates must pay Astro $230 million in restitution.
“We’re currently undertaking an appeal of the previous ruling regarding the dispute in South Jakarta District Court,” Gontha said.
Last September, the South Jakarta District Court dismissed an action brought by PT Ayunda Prima Mitra, a First Media subsidiary, against a subsidiary of Astro Malaysia on the grounds that Ayunda had no legal standing to sue. Ayunda is requesting an appeal of the ruling.
Dody Abdul Kadir, First Media’s legal adviser, said the SIAC arbitration ruling cannot be executed in Indonesia, according to a Central Jakarta District Court order issued in September 2008.
Dody also insisted that First Media cannot be held liable for any dispute or losses made by its subsidiary, as stipulated under the country’s 2007 corporate law, which says that any corporate action taken by a company is solely its own responsibility.
In a statement on Tuesday, Astro Malaysia characterized the dispute as between itself and several Lippo Group “entities.” Gontha, however, said the matter has nothing to do with Lippo.
The Jakarta Globe is affiliated with Lippo.
The Singapore ruling is the latest chapter in a continuing dispute between Astro and First Media over PT Direct Vision, a pay-TV joint venture between Astro All AsiaNetworks and Ayunda.
AstroNusantara, the satellite-television provider launched by Direct Vision, began operating in 2006 with 48 channels. It ceased operations in October 2008 because of the dispute.
Todung Mulya Lubis, Astro’s legal representative in Indonesia, said the ruling is final and there should be no appeal allowed.
“Astro believes that the Indonesian courts will enforce this award as they are required to under the New York Convention,” Todung said. “I fear that failing to do so will have significant repercussions for investor confidence in Indonesia.”
The 1958 New York Convention, which Indonesia became a signatory to in 1981, requires countries to uphold and enforce the ruling of international arbitration awards.