Bakrie Finance bankrupt: Supreme Court
Bakrie Finance bankrupt: Supreme Court
JAKARTA (JP): The Supreme Court has declared PT Bakrie Finance
Corporation bankrupt, overruling the verdict issued by the
Jakarta Commercial Court in March, a foreign creditor said.
Tae Seon Paik, an executive from Hong Kong-based creditor AB
Capital Markets Ltd., said on Thursday that the above decision by
the Supreme Court would give a strong boost to the country's slow
debt restructuring process.
"I respect the Supreme Court's decision," he said.
Plaintiff's lawyer Joni Aries Bangun of Hanafiah Ponggawa
Adnan Bangun Kelana law firm said the Supreme Court in its
verdict accepted his plain and simple arguments that the
defendant had a matured debt and owed money to at least two
creditors.
According to the 1998 Bankruptcy Law, a party to be declared
bankrupt must have at least one matured debt and owe to two
creditors or more.
"A bankruptcy suit is simple and straightforward, it should
not be seen as too complicated by the parties involved," Joni
said.
Four Hong Kong-based creditors filed a bankruptcy suit for the
second time in mid February against Bakrie Finance at the Jakarta
Commercial Court for the company's failure to pay US$13.5 million
in debts.
The four foreign creditors are AB Capital Markets Ltd., Cho
Hung Leasing & Finance Ltd., Hanmi Leasing & Finance Ltd. and KEB
Leasing and Finance Ltd.
The bankruptcy suit was rejected by the Jakarta Commercial
Court due to technical reasons. The previous bankruptcy suit
against Bakrie Finance filed by the same creditors was also
rejected by the court on technical grounds last year.
The foreign creditors filed an Appeal to the Supreme Court in
March, rejecting the Jakarta Commercial Court's verdict.
According to the March controversial verdict, the four
creditors' bankruptcy suit has yet to be approved by two-thirds
of Bakrie Finance's total creditors under the syndicated bank
loan.
The four foreign creditors' $13.5 million loan, which matured
on May 3, 1999, was part of a $21 million total loan matured
under a syndicated loan agreement involving seven foreign
financial institutions and one local bank, Bank Negara Indonesia.
Seon Paik said the Supreme Court's verdict on Bakrie Finance
was a victory to all foreign creditors in Indonesia.
"This decision will be respected by foreign creditors in
Indonesia who might have been frustratingly fighting to recoup
their bad debts," he added.
He admitted Bakrie Finance could request a "Civil Review" from
the Supreme Court to overrule the current Appeal decision, but
the chances of it being successful were very limited.
There has to be either a serious misapplication of the law or
a discovery of new evidence in the case for a Civil Review to be
accepted by the Supreme Court, according to the existing law.
(udi)