Agency seeks more power in enforcing market bylaw

Damar Harsanto, The Jakarta Post, Jakarta

The City Cooperatives and Small and Medium Scale Enterprises Agency said over the weekend that it was seeking more power to force malls and shopping centers to provide floor space for small vendors in line with the prevailing regulation.

Bylaw No. 2/2002 on markets regulates that every mall and shopping center must provide between 10 percent and 20 percent of their premises for small vendors. Failure to comply with the regulation could result in a fine of Rp 5 million or three months imprisonment for mall or shopping center owners.

The bylaw, however, does not stipulate any sanctions for owners found to have repeatedly failed to implement the bylaw after being warned.

"None of them abide by the regulation as no city agency is assigned to handle the enforcement of the regulation," agency head Sukri Bey told The Jakarta Post.

For that reason, Sukri said, his agency was proposing that Jakarta Governor Sutiyoso give the agency a stronger hand to ensure the management of malls or shopping centers meet their obligation.

He said that most malls and shopping centers preferred to pay a compensation and fine rather than designate special areas for small vendors.

Under the previous bylaw that was replaced by Bylaw No. 2/2002, mall and shop owners may pay an amount to the city administration as compensation in exchange for floor space for vendors.

The practice, however, continues even until now despite the fact that Bylaw No. 2/2002 does not allow mall and shop owners to do so.

Many people, including city councillors, say that allowing businesspeople to pay a fee in compensation opens the door to corruption, as much of the money does not in fact go to the small vendors.

The bylaw has raised strong opposition from the business community which claimed that the stipulation could scare off investors and infringed on their rights to manage their own properties.

The Association of Indonesian Real Estate Companies (REI), the Association of Indonesian Retailers and the Association of Indonesian Shopping Center Managements have filed a lawsuit with the State Administrative Court over the bylaw. The court ruled in favor of the retail and property businesses in the case last year and told the administration to revoke the bylaw. However, the city administration has appealed the verdict.

Councillor Muhamad Rusly of the United Development Party (PPP) faction lamented the administration's failure to help small vendors develop their businesses.

"The administration only managed to give assistance to 4,930 small vendors last year, a very slight increase from 4,910 vendors in 2003," Rusly said.

Jakarta has more than 141,000 vendors in different locations across the capital.

"We urge the administration to give serious attention to small vendors whose businesses are experiencing a downward turn due to rapid development of hypermarkets in the city," Rusly said.

Rusly also called on the administration to revise the bylaw, saying that the revision was necessary to solve its conflict with the property and retail businesses.

Separately, Jakarta Governor Sutiyoso welcomed the call to revise the bylaw, saying that his administration would immediately prepare the revision.