A Latief told to negotiate with IBRA

JAKARTA (JP): The Jakarta Commercial Court delayed on Tuesday proceedings in the bankruptcy suit filed against trading firm A Latief Corporation to allow the company the opportunity to reach an out of court settlement.

"We will meet again on Tuesday of next week for the second court hearing," presiding judge Sihol Sitompoel told the court.

The Indonesian Bank Restructuring Agency (IBRA) filed a bankruptcy suit against A Latief in late March, claiming the firm had unpaid debts of some US$17 million.

A Latief said the legal action by IBRA was out of proportion, and claimed to have attempted to initiate debt negotiations with IBRA but failed to receive a response from the agency's officials.

Tantawi J. Nasution, a lawyer representing IBRA, acknowledged efforts by A Latief to settle its debts with the agency.

"There is the possibility that A Latief Corporation is going to repay its debts to IBRA. We will see if that really happens within seven days from now," he said.

Tantawi said he would meet with A Latief executives to discuss the possibility of negotiating a debt settlement.

He guaranteed that if A Latief resumed debt repayments to IBRA, the agency would withdraw its bankruptcy suit.

But he stressed IBRA would not allow any debt relief for the principle owed by the trading firm, saying such relief only was possible for overdue interest payments and late payment penalties.

Lawyer Hotman Paris Hutapea, who represents A Latief, said on Tuesday there was a "technical" problem with the bankruptcy suit filed against his client.

Hotman said A Latief originally owed debts to Bank Danamon and Bank Pelita, not IBRA.

Those two banks were closed down by the government and transferred to IBRA under the government's bank restructuring program, he said.

"Thus the bankruptcy suit should be filed by these two banks, but with IBRA's power of attorney," he said.

The power of attorney was needed because the management of the closed banks had been transferred to IBRA, according to Hotman.

"This is in line with Article 40 of Government Decree No. 17 on IBRA," he said.

The agency brought three debtors to the commercial court in late March for their alleged failure to repay debts to the agency.

The companies are trading firm A Latief Corporation, crude palm oil processor PT Sumi Asih, which owes the agency Rp 73.94 billion and $6.73 million, and PT Ometraco Corporation, which has $53.18 million in unpaid debts. (udi)