Govt to make new bankruptcy law<\/p>\n
JAKARTA (JP): President Soeharto ordered Minister of Justice
\nMuladi yesterday to quickly prepare bankruptcy and antimonopoly
\nbills to improve the legal infrastructure for businesses in the
\ncountry.<\/p>\n
The President said the government would issue a regulation
\n(Perpu) next month as an alternative bankruptcy law before
\nenacting a new law due to the urgent need for the government to
\naddress the issue.<\/p>\n
\"The issuance of a Perpu is allowed by the 1945
\nConstitution... but consultations must first take place with the
\nHouse of Representatives,\" Muladi said after meeting with
\nSoeharto at his private residence on Jl. Cendana, Central
\nJakarta.<\/p>\n
Indonesia's bankruptcy code has been considered opaque and
\nirrelevant to the modern business world, it being based on the
\n1905 insolvency ordinance enacted by the Dutch.<\/p>\n
Radius Prawiro, chairman of the Corporate Foreign Debt
\nSettlement Team, said recently a new bankruptcy code would
\nexpedite the liquidation of insolvent companies in light of
\nresolving the private sector's US$73.96 billion offshore debts.<\/p>\n
\"The rights of creditors and debtors are mutually protected
\n(by effective bankruptcy laws),\" Muladi said.<\/p>\n
Analysts noted that the country's economic turmoil had forced
\nmany companies into technical bankruptcy but that the present
\nprocedures for declaring them legally bankrupt were so arduous
\nthat the parties involved had hesitated to utilize the legal
\nprocess.<\/p>\n
Foreign creditors lining up to foreclose on the assets of
\ntheir debtors to recoup loans have complained over the antiquated
\nand badly written bankruptcy procedures that make it nearly
\nimpossible for them to take legal action.<\/p>\n
\"Debtors who have goodwill must also be protected. So I wish
\nto emphasize the protection of the two parties,\" said Muladi.<\/p>\n
Senior economist Sri Mulyani Indrawati recently said an
\nadequate legal infrastructure and a transparent government would
\nbe vital in helping to solve the economic crisis.<\/p>\n
\"The International Monetary Fund must have also inspired us to
\nact quickly on the two laws. We must be honest and do not need to
\nhide it. But it is in our national interest to adopt an
\nantimonopoly law to ensure fair market competition,\" Muladi said
\nin reply to a question asking the reason behind the speedy move
\non the new laws.<\/p>\n
The President also called on Muladi to address allegations
\nmade by Indonesian lawyers Tuesday that foreign lawyers have been
\nworking here illegally.<\/p>\n
The President said the presence of foreign lawyers here was
\nunavoidable, especially with regard to World Trade Organization
\nrules on trade and services.<\/p>\n
However, the President said the government had not lifted the
\nlaw restricting foreign lawyers working in the country.<\/p>\n
\"As long as we have not liberalized our service industry,
\nincluding legal services, foreign lawyers cannot make legal
\npresentations here,\" Muladi pointed out. (prb)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/govt-to-make-new-bankruptcy-law-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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