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.