Firms grow aware of unfair practices
Firms grow aware of unfair practices
Sandy Darmosumarto, The Jakarta Post, Jakarta
Businesses in many of the nation's economic sectors are now
more sensitive to unfair market practices that cause barriers to
the development of fair competition, the country's antimonopoly
watchdog said on Monday.
The barriers include the presence of dominant market players,
discriminatory business agreements, and government intervention
that limits the number of firms in a particular sector.
The Business Competition Supervisory Commission (KPPU), an
antimonopoly watchdog, recorded a rise in the number of valid
claims with respect to unfair market competition coming from
companies in various lines of business.
Sutrisno Iwantono, chairman of the commission, told The
Jakarta Post that "around 75 percent of total claims reported in
2003 are valid. This figure is way higher than last year's."
"This phenomenon demonstrates that people, specially
businesses, have a strong will to learn and understand about
monopolistic practices in order to eradicate barriers that
prevent the growth of their business activities," he said.
The commission received a total of 45 reports this year. Only
nine cases were dealt with in addition to one unfinished case
from the previous year. The commission claimed that the other
cases were either invalid or lacked supporting documents in order
to go to court.
KPPU has received a total of 140 reported claims since its
establishment in 1999. There has been an increase each year in
the number of reported claims since the commission's first year
of operation. Invalid cases are those linked to issues outside
the scope of the commission.
Out of the 10 cases it dealt with in the current year, four
have arrived at a verdict. Two cases are awaiting a verdict.
Three cases are still under investigation, and a probe into one
case will be discontinued.
Most of these cases are related to business tenders involving
the government or state-owned companies. Collusion and
discriminatory business practices by corrupt and non-transparent
government-related institutions are dominant characteristics in
cases the KPPU has been dealing with since the beginning.
To improve the business climate, the KPPU has submitted
further recommendations to the government over various
competition policies. The advice was intended to correct faulty
regulations that nurture unfair competition.
Many competition policies are in conflict with Law No.5/1999
on the prohibition of monopolies and unfair business practices,
even those introduced after the enactment of the law.
"This year, we came up with 10 recommendations directed at the
government. There were only around three recommendations last
year," commented Sutrisno.
In order of priority, the KPPU will continue its efforts next
year to monitor the utility and transportation sectors, as well
as sectors possessing high market concentration and those in
which the government intervenes.
With respect to the utility sector, much stress is put on
competition policies regulating electricity, water,
telecommunications and public roads.
All modes of transportation, including the air, sea and rail
sectors are included in KPPU's agenda. A separate issue is that
of urban transportation.
Other sectors are those that have a high market concentration
with only a few firms operating in them. These sectors include
flour, cement, instant noodles and paper.
As for the sectors in which the government intervenes, they
include fertilizer, sugar, coordination of the haj pilgrimage and
insurance.