Expert claims antimonopoly law has loopholes<\/p>\n
JAKARTA (JP): The newly passed antimonopoly law does not go
\nfar enough in ensuring healthy and fair business competition, an
\nindustrialist and legal experts warned on Monday.<\/p>\n
Fransiscus Welirang, a director at food giant PT Indofood
\nSukses Makmur, said that lack of clear definition for several key
\nterms was resulting in business skepticism.<\/p>\n
He emphasized that the law failed to define the terms \"market
\nshare\", \"vertical integration\" and \"efficiency\" -- key concepts
\nto determine whether a company is engaging in monopolistic
\npractices.<\/p>\n
\"It is not clear whether the market share is indicated from
\nsales value or sales volume. It is a crucial point because
\nsimilar products have different purchasing value depending on
\nquality and market segment,\" he said at an antimonopoly seminar
\nheld by Atmajaya Catholic University's Faculty of Administration
\nSciences.<\/p>\n
As an example he said local cosmetic Viva recorded the biggest
\nsales volume in the country, but its sales value was lower than
\nimported cosmetics such as Lancome or Ultima II.<\/p>\n
\"The limitation of a market share will be hard to implement
\nbecause it is next to impossible to measure market shares
\nregularly,\" Fransiscus said.<\/p>\n
The antimonopoly law, passed by the House of Representatives
\nlast month, prohibits a company from holding more than 50 percent
\nof the domestic market share.<\/p>\n
Companies breaching the law are liable to a maximum fine of Rp
\n100 billion (US$11.76 million) and six-month jail terms for
\nexecutives.<\/p>\n
The law, however, stipulates that a company will not
\nnecessarily be penalized if the independent commission finds that
\nthe extended market share is gained through efficiency, and the
\ncompany does not abuse its dominant position to restrict new
\nmarket entrants.<\/p>\n
The commission -- the Business Competition Supervisory
\nCommission -- will oversee the implementation of the law. Its
\nmembers will be appointed by the President with the House's
\napproval.<\/p>\n
Lawyer Benny K. Harman, director of the Center for Information
\nand Economic Law Studies, said the efficacy of the law would
\ndepend largely on the technical competence, integrity and
\nautonomy of commission members.<\/p>\n
\"But I am very pessimistic on the independency of the
\ncommission, as the appointment and retirement of members is
\nlargely decided by the President.<\/p>\n
\"It will be better if the commission is responsible only to
\nthe House not to the President, and they should be appointed for
\nlife so they will not worry about the possibility of not being
\nreappointed for the next term.\"<\/p>\n
Benny said several articles in the law, especially exemptions
\ngranted to various government regulations, increased the
\nlikelihood of collusion between officials and businesspeople.<\/p>\n
He also said that the government's effort to establish the law
\nwas merely a token gesture to comply with an International
\nMonetary Fund requirement, instead of a genuine effort to create
\na healthy business climate.<\/p>\n
Wolfgang Kartte, who led a team of seven German experts hired
\nlast year by the government to provide advice on the antimonopoly
\nbill, said the new law had met international standards on
\nantitrust law.<\/p>\n
Kartte, who served as president of the German Antimonopoly
\nBoard for 16 years, said it would take years to improve the law
\nin order to prevent monopolies and other unfair competition
\npractices.<\/p>\n
\"However, I congratulate Indonesia for successfully
\nestablishing the law because it is badly needed to attract
\nforeign investors to the country,\" he said. (gis)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/expert-claims-antimonopoly-law-has-loopholes-1447893297",
"image": ""
},
"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
}