Govt urged to go ahead with AriaWest takeover
JAKARTA (JP): The House of Representatives urged the government to go ahead with its plan to temporarily take over the telecommunications operations of PT AriaWest International in West Java and Banten, despite objections from the company.
A senior government official, however, warned the Ministry of Communications against going ahead with the plan, saying the move could cause an international outcry.
The House's Commission IV for infrastructure and transportation said the ministry should put the plan into effect as soon as possible and use its own funds to run the operation.
"The government should use its own funds, so that it is clear that it is the government that is taking over the operation," vice chairman of House Commission IV Rosyid Hidayat told The Jakarta Post, referring to one of the conclusions arrived at after the Commission's meeting with AriaWest and its joint operations (KSO) partner PT Telkom.
The government plan to take over AriaWest's operation follows on from a protracted dispute between the company and state-owned telecommunications provider Telkom, which has reportedly lead to disruptions in telecommunications services in parts of Banten and West Java.
Telkom's employees in both provinces, who are managed by AriaWest under the KSO contract, have yet to receive their June salaries because of the dispute.
The dispute centers on the valuation of the assets owned by the KSO, which Telkom wants to buy out.
The Ministry of Communications said last week it would set up an independent team to temporarily take over AriaWest's operations in both provinces.
AriaWest rejected the plan outright, calling it an "expropriation" of its rights.
The company's chief financial officer, Stephen Dowling, said if the government carried out its plan, the company would take the matter to international arbitration.
He warned that international agencies such as the World Bank and insurance firms would take legal action against the government of Indonesia.
AriaWest has already filed arbitration proceedings against Telkom on charges of breaching their KSO contract.
Assistant to the Coordinating Minister for the Economy Dipo Alam, who also attended the meeting, warned of the international pressure if the government realized its plan.
"The takeover would only be justified if the House asked the government to do so. But there are risks the government will have to face," said Dipo, who had been officially assigned by the government to mediate in the Telkom-AriaWest dispute.
Dipo stressed that if the government went ahead with its plan, the independent team should use government funding to run the operation.
"Otherwise, we would risk being accused of using illegal funds, and so forth," Dipo added.
Legislator Enggartiasno Lukita, however, dismissed the threats saying that the Indonesian government would appeal to foreign embassies for support.
"Besides, the majority shareholder in the company is local anyway. They (the foreign stakeholders) only hold a minority share here," he said on the sidelines of the hearing with the House.
Enggar was optimistic that once the government took over AriaWest's operations, the company would be more rational in its valuation of the operations.
AriaWest is 52.5 percent owned by PT Artimas Kencana Murni, 35 percent by U.S.-based MediaOne International B.V., of which telco giant AT&T is a part, and 12.5 percent owned by Hong Kong's Asian Infrastructure Fund. (tnt)