'Court to declare' Dharmala bankrupt<\/p>\n
JAKARTA (JP): The Supreme Court is set to declare publicly
\nlisted PT Dharmala Agrifood bankrupt, overruling its decision in
\nFebruary, lawyers close to the case said.<\/p>\n
They said on Thursday that although the ruling had yet to be
\nmade public, they knew informally of the decision.<\/p>\n
Dharmala's lawyer Hotman Paris Hutapea also said he heard the
\nverdict was pending but was awaiting formal notification.<\/p>\n
\"Yes, I have heard about it. This will be the first case I
\nhave lost in the last five years,\" Hotman told The Jakarta Post.<\/p>\n
\"But I lost in a political battle. Legally, I think, I won
\nit.\"<\/p>\n
Hotman alleged the pending verdict was the result of political
\nmaneuvering by foreign creditors dissatisfied with the Supreme
\nCourt's decision last February to reject a bankruptcy appeal by
\nthe International Finance Corporation and other creditors against
\nthe agricultural food producer.<\/p>\n
The IFC -- the private investment arm of the World Bank --
\ntogether with ING Indonesia Bank and publicly listed Bank Niaga
\nfiled an appeal petition with the Supreme Court after their
\ninitial bankruptcy claim against Dharmala was thrown out by the
\nJakarta Commercial Court early last December.<\/p>\n
The commercial court ruled that loans of IFC and ING Indonesia
\nBank to Dharmala Agrifood, totaling US$51.7 million, were not
\n\"due and payable\", a prerequisite for a bankruptcy claim.<\/p>\n
It further ruled that the claim of Bank Niaga over its loans
\nworth Rp 16.04 billion ($2.1 million) to Dharmala Agrifood was
\n\"null and void\" because the credit agreement was granted to cover
\nforeign exchange losses and such an arrangement breached Bank
\nIndonesia's regulations on derivative transactions.<\/p>\n
The Supreme Court's ruling in February drew criticism from
\ncreditors and foreign insolvency experts.<\/p>\n
They said the appeal ruling did not bode well for impatient
\noffshore creditors struggling to recover debts from Indonesia's
\ntroubled firms.<\/p>\n
The creditors then opted for the final legal resort by seeking
\nreview of the February ruling. A different set of Supreme Court
\njudges sat on the review panel.<\/p>\n
A local lawyer who insisted on anonymity said the Supreme
\nCourt's pending decision to declare Dharmala Agrifood bankrupt
\nindicated there was misapplication of the bankruptcy law in the
\ncountry's commercial court.<\/p>\n
But Hotman claimed that the judges caved in to pressure of the
\ngovernment, itself answering to the International Monetary Fund,
\nto send out pleasing signals on the bankruptcy law's
\neffectiveness. (02\/rid)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/court-to-declare-dharmala-bankrupt-1447893297",
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