Antimonopoly body to probe eight leading companies

Antimonopoly body to probe eight leading companies

JAKARTA (JP): An antimonopoly watchdog will soon investigate
eight leading companies for possible violations of the
antimonopoly law.

Syamsul Muarif, a member of the Business Competition
Supervisory Commission, said on Tuesday that all eight companies
controlled more than 50 percent of the market share in their
respective businesses.

"According to law, it is our duty to be suspicious of any
company that controls over 50 percent of the market, but if they
are not preventing others from entering the market, then that's
fine with us," he said at a media briefing here.

The eight companies are: PT Inti Boga Sejahtera, which
controls 60 percent of the country's cooking oil market, PT
Indofood Sukses Makmur, which holds a 90 percent share in the
instant noodles market, and PT Bogasari Flour Mills, holding 90
percent of the country's wheat flour market.

The others are PT Aqua Golden Mississippi, which holds an 83
percent market share in the mineral water market, PT Unilever
Indonesia, holding a 58 percent share in the detergent market, PT
Santos Jaya Abadi, controlling 50 percent of Indonesia's instant
coffee market, PT Asahimas Flat Glass, controlling 65 percent of
Indonesia's glass market, and Pertamina, controlling 60 percent
of the country's lubricating oil, he said.

Another commission member, Faisal Basri, said the surveillance
of the eight companies did not necessarily mean that they were
guilty of unfair practices.

Faisal said big companies were worth the suspicion because
they were the ones who were most susceptible to unfair practices
in the marketplace.

"If for a long time there are no new players in the market,
then it is wise to be suspicious of big companies. Have they
deliberately prevented other players from coming in?" he said.

Soy M. Pardede, another commission member, said unfair
monopolistic practices include operating a strong distribution
network to allow it to control prices.

"We know that in the past the Salim Group used these methods
to control the market, but I don't know, it seems that these
practices are well hidden now," he said.

In the services sector, state-owned enterprises such as sea
transportation company PT Pelni, land transportation company PT
Damri, train company Perusahaan Jawatan Kereta Api (PJKA), and
telecommunications company PT Telkom will also be investigated,
Soy said.

The commission was established in June by President
Abdurrahman Wahid following the enforcement of the Antimonopoly
and Unfair Competition Law No. 5/1999.

The commission, with 11 members, has the right to investigate
businesses which are suspected of unfair practices and impose
sanctions.

The antimonopoly law has been in effect since March and the
commission has given companies until September this year to
reorganize their businesses before the law is fully enforced.

Soy said in the six months after the establishment of KPPU
many companies had tried to adjust to the antimonopoly law.

The commission is currently investigating PT Indomaret and PT
Caltex Pacific Indonesia for their alleged involvement in
monopolistic practices.

"We are in the second stage of investigations," Soy said,
adding that the secondary investigations would take approximately
60 days with a possible 30-day extension, and another 30 days for
verification.

The commission will create next year a criteria that will
exempt state-owned companies which sell goods or services that
concern the welfare of the general public from the antimonopoly
law, he said.

The 1945 Constitution stipulates that goods and services that
concern the welfare of the general public should be controlled by
the state.

But he said the antimonopoly law had yet to clearly define the
criteria of companies which fall under the category of providing
goods or services for the welfare of the general public. (tnt)