Team close to finalizing new companies' legislation<\/p>\n
JAKARTA (JP): A government-sanctioned team is close to
\nfinalizing the drafting of a new corporation law that will place
\nemphasis on good corporate governance.<\/p>\n
The new law will replace the existing Law No. 1\/1995, which
\nmany say has yet to be fully implemented by all corporations in
\nthe country.<\/p>\n
\"We're close to finalizing the draft,\" Ratnawati Prasodjo,
\nhead of the Team for the Revision of Corporate Law, formed by the
\nMinistry of Justice and Human Rights, told The Jakarta Post on
\nthe sidelines of the two-day seminar on the revision of the
\ncorporate law, which ended on Tuesday.<\/p>\n
The team includes experts from the Ministry of Justice and
\nHuman Rights, the State Secretariat, the Capital Market
\nSupervisory Agency (Bappepam), academics and other professionals.<\/p>\n
She said the government intended to revamp the existing law
\nbecause it was no longer regarded suitable to address issues that
\nhad arisen within the corporate sector over the past several
\nyears.<\/p>\n
\"With the rapid progress of technology and the current social
\nand economic situation, it's necessary for us to review the
\nexisting corporation law,\" she said<\/p>\n
\"The 1997 financial crisis, which left many corporations in
\ndeep trouble, opened our eyes to the fact that we do not have a
\nsufficient law to prevent illegal business practices from
\nhappening,\" Ratnawati said.<\/p>\n
\"When companies were closed down and liquidated in the
\naftermath of the 1997 economic turmoil, there were no laws to
\nregulate who was going to be held responsible for their bad
\npractices.\"<\/p>\n
Following the crisis, most local companies stumbled into
\nfinancial trouble due to their failure to repay debts because of
\nthe highly-appreciated dollar. That led many of them to face
\nliquidation or be taken over by creditors.<\/p>\n
Things then went from bad to worse as the country's legal
\nsystem was not well equipped to deal with such problems.<\/p>\n
Ratnawati further underlined the importance of the revision of
\nthe existing corporate law given that it was not compatible with
\nseveral related laws enacted over the past several years,
\nincluding the Bankruptcy Law No. 4\/1998, the Consumer Protection
\nLaw No. 8\/1999, and the Law No. 5\/1999 on the Restriction of
\nMonopolistic Practices .<\/p>\n
\"It (the new corporate law) will bring about clearer rules for
\nall concerned parties, including employees, who often had to bear
\nthe brunt of negative impacts in the past caused by the
\nuncertainty in corporate regulations,\" Ratnawati said.<\/p>\n
She did not elaborate further as to which clauses of the
\nexisting law needed to be revised as it needed more input from
\nthe public.<\/p>\n
\"That's why we're having this seminar. This kind of forum will
\ngive us input from the public,\" Ratnawati explained, adding the
\nteam had earlier held several similar workshops to gather input
\nfrom the public for the draft law.<\/p>\n
Before being proposed to the House of Representatives (DPR),
\nthe draft law should be consulted with various ministries and
\nsent to the State Secretariat for presidential approval.<\/p>\n
After being approved by the President, the ministry will then
\nsubmit it to the House for debate and approval. (10)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/team-close-to-finalizing-new-companies-legislation-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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