Council threatens to punish Indomaret
Council threatens to punish Indomaret
JAKARTA (JP): The City Council threatened on Wednesday to take
legal action against the management of Indomaret minimarket for
twice ignoring the council's summons.
A member of the City Council's Commission B for economic
affairs, Agus Dermawan of the National Mandate Party (PAN), said
the council would issue the last summons to the company for a
hearing to be held in response to protests lodged by small
vendors.
"We will take legal action if they fail to show up for the
third time," Agus told dozens of small traders who went to the
council to renew their protest at the operation of the
minimarket.
Article 20 the council's standing order stipulates that
government officials and private parties should comply with the
council's summons.
Article 21 says that failure to meet the summons could be
considered a contempt of the City Council and violators face
punishment. The standing order does not specify the punishment.
Agus questioned the existence of Indomaret, a franchised
minimarket, saying that more than 70 percent of hundreds of its
outlets operating here are owned by PT Indomarco, a subsidiary of
the giant conglomerate Salim Group.
He also claimed that about 30 outlets were operating without
proper permits.
The visiting traders, grouped under the Greater Jakarta Small-
scale Traders Association, complained that the minimarkets have
sparked unfair competition because they are located close to the
small traders who have been operating for years before the
minimarkets came.
One of the traders, Marah Sakti, claimed that the minimarkets
sold their merchandise cheaper than the market price and that
many traders had gone bankrupt as a result.
"We have lost many customers although we only set a 5 percent
profit for each item we sell," Marah, who owns a shop in South
Jakarta, told reporters.
The traders also accused the minimarkets of selling the
products of Salim Group, such as instant noodle and milk, at a
lower price.
Currently, some Indomaret minimarkets are run under a
franchise scheme by residents in housing complexes. There are 269
Indomaret outlets across Jakarta.
Each outlet, which has an average width of between 60 and 200
square meters, supplies communities with basic needs from 10 a.m.
to 10 p.m. daily.
However, there has been speculation that most of them have yet
to obtain a building utilization permit (IPB), authorizing a
change of use from a residence to commercial premises.
Gubernatorial Decree No. 50 of 1999 stipulates that every
privately run market measuring less than 200 square meters must
obtain a basic license from the City Secretary.
Furthermore, the minimarket must obtain a business permit from
the Jakarta office of the Ministry of Industry and Trade, and a
security permit from the City Public Order office. (jun)