KPPU: Flour importers criticize new policy

JAKARTA (JP): The country's antimonopoly watchdog said on Thursday that the government's plan to impose antidumping duty on flour imports may create unfair business competition in the industry.

Chairman of the Business Competition Supervisory Commission (KPPU) Mohammad Iqbal said, however, that the committee would still have to conduct a further evaluation before proposing any recommendations to the government.

"We will monitor the industry closely for two to three months to find out whether the reports we have received are valid or not. After that, we will issue recommendations (to the government)," Iqbal told The Jakarta Post after a hearing with House of Representatives Commission V which oversees industry and trade affairs.

He said that KPPU had received complaints from the country's flour importers that the new policy may increase the price of their products, while on the other hand local giant flour producer PT Bogasari Flour Mills could take advantage of the policy by selling at a cheaper price.

"This will force local instant noodle and food producers to purchase floor from Bogasari," Iqbal said.

The government plans to impose the antidumping duty soon following dumping charges made by the Indonesian Antidumping Committee (KADI) on flour from Europe, the United Arab Emirates, and Australia.

KPPU also said that flour importers had complained about the stringent administrative requirements imposed by the excise and customs office on the import of flour, while wheat importers like Bogasari enjoyed more relaxed requirements.

"They repeatedly complain that such time-consuming paperwork reduces the quality of their flour," Iqbal said.

He said that KPPU was expected to complete its evaluation in December.

KPPU was established in June last year following the enactment of the Antimonopoly and Unfair Competition Law No. 5/1999.

The commission has the right to investigate and sanction businesses that are suspected of unfair practices. (dmr)