20 firms reported to antimonopoly commission

20 firms reported to antimonopoly commission

JAKARTA (JP): As many as 20 companies have been reported to
the newly established anti-monopoly commission for alleged unfair
business practices, a commission member has said.

Member of the Business Competition Supervisory Commission
(KPPU), Pande Radja Silalahi, said the companies were involved in
a wide range of businesses ranging from oil to food, from retail
chain to medicine.

"Most of them are accused of practicing unfair business
through, for example, vertical integration and price
discrimination," he told The Jakarta Post on Tuesday.

KPPU is still collecting additional to ascertain as to whether
the complaints merit further investigations, he said.

The 11-member KPPU has launched preliminary investigations of
three companies, namely retail chain Indomart, American oil and
gas firm PT Caltex Pacific Indonesia and a foreign tempeh and
tofu importer.

It has been alleged that Indomart owner PT Indomarco only
sells products from its parent company, the giant food producer
Indofood. The company has denied the charge.

Caltex allegedly awarded contracts for a large pipeline
project unfairly.

The foreign soybean firm has been accused by the Indonesian
Tofu and Tempeh Cooperative of practicing price manipulation to
undercut local producers.

KPPU's vice chairman Syamsul Maarif said on Monday that the
commission would decide on Oct. 15 whether to proceed with the
Caltex investigation.

The commission has 30 days from the time a complaint is
received to investigate and determine if there is a valid case.
If so, it must set up an investigative panel. The panel then has
60 to 90 days to investigate and make a judgment.

Indited companies are given 14 days to respond.

Pande said that the public had shown strong interest in the
commission's role as reflected by the significant number of
companies reported to the commission, which was only established
in June.

He said the commission was fully aware of the public's high
expectations to combat unfair business, but it could not promise
quick results.

Peter Heermann, a law professor from the Bayreuth University
in Germany, shared Pande's view, saying that it would require
some time for the public and business community to properly
understand the new law and for KPPU to develop their
capabilities.

"You have to be patient before the law can work well. Please,
give KPPU some time," he said, adding that KPPU has lots of
things to do in order to better introduce and implement the
regulations.

For example, KPPU should first prepare and publicize clear-cut
guidelines that include legal definitions of some crucial terms
used in the law, like monopolistic practice, dominant position,
prohibited agreement and concentration of economic power, he
said.

He said KPPU must, most of all, work in absolute transparency.

"It is highly recommended that KPPU make all of its decisions
known to the public so that they can be checked by everybody," he
said.

Faisal Basri, another KPPU member, said the commission pledged
its commitment to transparency and fairness in all its
activities.

"All of our work, as long as it is not confidential, such as
the identity of people filing charges or documents in preliminary
investigations, will be made known to the public," he said.

He said he was optimistic that KPPU, despite lacking a proper
office, operational funds and experience, would eventually be
able to do its job well.

KPPU was established in June by President Abdurrahman Wahid in
compliance with the unfair business competition Law No. 5/1999,
popularly called the anti-monopoly law. It became effective early
this month after a six month grace period to allow companies time
to review their current practices.

The law forbids individual companies from controlling more
than 50 percent of a domestic market or two or three firms from
controlling a combined 75 percent while deliberately inhibiting
competitors from entering the market.

It also forbids practices of oligopoly, monopsony, price
fixing, price discrimination, cartel, geographical designations
of markets by suppliers, resale price maintenance and collusion
in bidding. (cst)